– 50% back up rally is ripe for taking profits and panicky limiting of losses
– Bounced down off the 280+ level twice, last Thursday end of day and again this morning
– April 15th was the Roth IRA deadline, retail investor buying dries up now
– A lot of the Trump bucks and easy SBA money has already been distributed, also drying up
– AMZN, NFLX, TSLA, etc in blow-off tops
– All the popular hot posts were extremely bullish today
– Tons of bear comments were capitulatory, peak covering for 4/17 puts yesterday
– This morning treasuries shot up hard, as yields compressed, money is moving to safety
– The market limped forward like a wounded gazelle today, but treasuries didn’t retreat
– Every boomer who didn’t invest in the last year can feel relief about selling on weekend, at the last couple year’s prices, if Thursday and Friday are red
– Weakness in retail investor buying would cause traders to jump on the bearish trend
– Earnings misses and cut guidance have consistently hurt the companies reporting so far
– More earnings misses and cut guidance are coming, impacting SPY
– As hurting businesses and unemployed people feel the need to raise cash for household and business spending, risky investments like equities will be under pressure to sell
– Volatility hit the mid-30s, making yesterday a great time for puts, today not bad either
– Volume has been creeping ever-lower at these price levels
– The participants in the market right now are traders looking to get one over on each other
– As the rush of buying dwindles, people FOMO into the opportunity to sell sooner
– The economic facts make a simple V-shaped recovery incredible, and that will be reflected in trading
Unemployment is spiraling toward 20%. Retail sales just dropped the most on record. Global economists predict the worst recession in eight decades. And stock investors have made peace with it all.
Up 27% since mid-March, the S&P 500 on Tuesday capped its biggest 15-day run since 1933. So furious has the revival from the fastest bear market been, equity valuations are now back to where they were before it all started. Wednesday’s pullback hasn’t even retraced one day’s advance.
It’s a Wall Street adage: The stock market isn’t the economy. Rarely has it seemed more true than in the frenzied advance of the past few weeks.
GuvvD: RT hmeisler: HYG and JNK now lower than where they opened after the Thursday Fed announcement.
— Tadeus (@TadeusPA2016) April 15, 2020
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.