We Need to Understand What Gold Is… and What Gold Isn’t
I got an email from a TheoTrader, one sharing a video talking about gold and how it’s breaking out against a 60/40 equity and bond portfolio. I love it when people share these things because it gets you thinking! “What are my thoughts?” you ask. Well, I’ve been talking about the S&P 500’s underperformance against…
All Quiet on the Bearish Front
All Quiet on the Western Front was a semi-autobiographical novel written about World War I from the perspective of a young German soldier who dies a month before the end of the war, on the very same day his superiors report “all quiet on the Western Front.” As I think about the bulls’ perspective on…
“It Could Be a Trap” - Beware a Bond-Market Fast One
Today we got something that seemed like a “normal” selling day with only two sectors down more than 2%. This seems a little ridiculous in perspective, given the lack of volatility for the past couple of years, but it’s definitely an improvement at a time when the VIX hits a 60-handle. Tempting, then, to think,…
Gold Is Taking the Shine Off the S&P 500
The S&P 500 just experienced a 2% rally after a risk-off day, with the VIX nearly hitting 25 before reversing. However, gold’s performance, with the SPDR Gold Trust (GLD) up 1.4%, outshone most S&P sectors, signaling underlying market unease. Gold’s outperformance suggests a shift away from inflationary assets, as demand for physical gold rises amid…
How “Ghost Prints” and “Squeezequakes” Are Driving This Market Higher
Big market moves often come with big stories, and last week was no exception. It all started on Thursday when some massive “Ghost Print” call option trades hit the Magnificent Seven stocks - Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Alphabet (GOOGL), and Meta (META). As I said in Friday afternoon’s First Mover Market Advantage, these…
What to Do As Bitcoin Bumps and the Magnificent Seven Jump
On Friday, I outlined an important litmus test for the market. It was based on a series of option prints that came into Magnificent Seven (“Mag 7”) stocks on Thursday. These large “Ghost Prints” are incredibly powerful when it comes to capturing profit potential - and you’re going to be hearing a lot more about…
Today We’ve Got a Magnificent Seven Litmus Test
A general axiom for the market is that traders will go back to what worked in previous moves higher following a correction. I’ve been waiting for the option market to reflect that kind of optimism, and we got that yesterday. The Magnificent Seven (or “Mag 7,” if you’ve been around the block a few times)…
Fed Policy in the Time of Financial Cholera
It’s Fed Day and Chairman Powell has some splainin’ to do. Right now, the market feels like Ricky talking to Lucy about what she’s done - and what to do now. We knew that Ricky loved Lucy just like Florentino loved Fermina in Gabriel García Márquez’s 1985 book, “Love in the Time of Cholera.” I’ve…
The Smart Way to Play China’s Big Week
If you've been following Chinese stocks (the top destination of lots of global capital these days), you’ll know volatility has been expanding as price has been rising. Even the recent consolidation has seen volatility remain elevated and expanding on today's breakout. In China, the prospect of the next round of stimulus is the exclusive driver…
The Next 10% Move (Here’s How to Prepare)
What were your thoughts as you read the title of today’s issue? Were you assuming the next 10% is up or down? Were you thinking that an argument was going to be provided in which you’ll agree or disagree? The S&P 500 has fallen 10% from its high, which is one of the most difficult…