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Remember I am out of the office from 11am- 28 Apr, 2022

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Market Outlook- Another oversold bounce – Dancing at the VWAP – which has an upward slope – watch that opening tick. For the ES_F, we are battling at the next upward level 4225 and 4265 with 4312 above-we know what is below from yesterday- our levels remain robust. Just learning how to navigate them takes work. Dip buying looks valid into resistance. BUT shorts at highs remain valid.

Earnings continues and the US looks stronger than the rest of the world; and the collapse of the YEN in relation to the dollar remains big news

Some charts

Fear Greed Index

Notice traders trying to create a floor here


King dollar

The dollar hasn’t been this strong in more than five years as investors can’t seem to shake off the appeal of a currency where nominal yields are the highest in developed markets. What’s nectar for the dollar isn’t so sweet for the rest, with the yen tumbling past 130 per unit of the greenback. To add to all that excitement in the currency markets, Sweden’s central bank surprised most by raising its benchmark rate to send the krona soaring.

Millennials strike back

Meta Platform Inc. shares soared before the start of U.S. trading after Facebook returned to user growth after the first-ever decline in the December quarter. But Chief Executive Officer Mark Zuckerberg has acknowledged that video-sharing app TikTok is providing serious competition for young users’ attention. The European Union said today Meta can still face lawsuits from consumer groups for possible violations of data protection rules. Next up in big tech earnings after the market close are Inc. and Apple Inc., where the focus will be on its supply chain.

Paying for gas

Several European Union nations are pushing for clearer guidance on Russia’s demand to pay for gas in rubles, saying the current advice is too ambiguous. A number of countries who raised the issue want the European Commission to clarify that buyers don’t have any workarounds to acquiesce to the Kremlin’s demands, according to people familiar with the discussions. NATO allies have “pledged and provided” more than $8 billion in military aid to Ukraine so far, said alliance chief Jens Stoltenberg. U.S. President Joe Biden plans to deliver remarks Thursday on support for Ukraine as his administration looks to send to Congress a proposal for more weapons and humanitarian aid. The German parliament urged the government to quickly supply Ukraine with heavy weapons and other equipment.

Stocks rally

U.S. equity futures and European stocks rallied. The tech-heavy Nasdaq 100 climbed more than 2% as of 5:40 a.m. New York time, boosted by Facebook’s parent company Meta. The company rose about 17% in pre-market trading. S&P 500 futures also increased some 1.7%. In Europe, autos, tech and travel firms were the strongest performing sectors. The Stoxx 600 climbed 1.2%. The dollar rallied. WTI futures traded at around $102 a barrel. The 10-year Treasury yield was down some 2 basis points to 2.8147%. Bitcoin climbed, trading just below $40,000.

Coming up…

We have a busy day ahead starting with the U.S. advance 1Q GDP release and weekly jobless claims data at 8:30 a.m., followed by the Kansas City Fed Manufacturing Activity print for April at 11 a.m. U.S. President Joe Biden plans to deliver remarks Thursday on support for Ukraine at 10:45 a.m. It’s also a packed day for earnings releases with Caterpillar Inc., McDonald’s Corp., Mastercard Inc., Comcast Corp., Twitter Inc., Apple Inc., Intel Corp. and Amazon Inc. among the names reporting throughout the day. Elsewhere, the EIA will release natural gas storage data at 10:30 a.m. and this week’s Treasury sales will conclude with $44 billion in 7-year notes auctioned at 1 p.m.

What we’ve been reading

Here’s what caught our eye over the past 24 hours.

And finally, here’s what Joe’s interested in this morning

On today’s episode of the Odd Lots podcast, Tracy Alloway and I talked to Kyla Scanlon and Lily Francus, who have been two of the most astute observers of how markets have changed over the last years. Both are highly active on social media, and have a deep understanding of the retail mania that started in 2020, peaked in early 2021, and has been slowly deflating ever since last spring.

The conversation was fascinating, but also unexpectedly poignant, with one of the main themes being that a decent number of traders who entered the market in spring 2020 came to view stock market riches as their “shot” to get ahead, in an economy in which inflation outstrips wage growth, and owning a home is perceived to be increasingly out of rich. And so in that environment, you buy calls on hot stocks and hope you’re a winner.

Along these lines, you can really see the appeal of trading crypto. While you can certainly make money trading stocks, if you’re skeptical about the system overall, then you might be skeptical you can get a fair shot trading stocks. After all, Wall Street bigs have more computing power and access to info than you do.

With crypto, so much of the social media chatter is itself the source of alpha. There are scenarios where the person with the NFT ape avatar does in fact know more than anyone else, and it’s understandable that people might find that more democratic and appealing in this political environment.