Option Professor- Stock Market-Everyone Says Declines Temporary-Truth or Dare? Must Read!
September 17 2021 Option Professor Opinions & Observations
As we said last week the markets are deteriorating with almost 50% of small caps 20% under their highs mid caps 30% and large cap 15%…after 2001 peak they also went after the market sequentially. The value trade (Banks Industrials Materials ect) are deteriorating and if rates continue higher tech will fade even more (long duration earnings). The inflation n umbers were ok and retail sales surprised to the upside and this week we get a peek at earning for the homebuilders (LEN KBH) and transports (FDX) and retail (NKE)…not a bad smorgasbord. Here’s our view and we said this last week…the road to all these lofty levels the talking heads say (4600-4800 yearend) will not occur if we can’t take out S&P 4480 (we failed in that neighborhood this week) and 4510 and this weeks close hardly threatened those numbers at the end of the week. So far; it’s been a good time to keep your wallet in your pocket and not just blindly follow the green light blue skies crowd. We’re not Nostradamus or Kreskin so we follow the numbers and yes if we get choppy the numbers don’t work very well BUT if we are to trend higher we feel our numbers are germane.
You should get our detailed report and learn how we feel what positioning make sense for Q4 and beyond.
Again; we said that SPX 4480-4510 must get taken out if higher levels are to occur…. the Missouri motto (the show me state) seems to make sense here as we can blame the drop on triple witching but banks-industrials and materials were fading long before Friday. What sectors to play and to what weighting is the key to Q4 and we share our ideas on it.
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Everyone is getting excite about a 1.37 1oyr and a Fed meeting on Sept 22 about tapering. We told you this is a joke as we feel the 1.75% 10 yr in Q1 was the taper tantrum and until proven otherwise we see any dip in bond prices as a steal particularly in tax frees…with the worldwide debt at these levels do you think central banks can raise rates much??
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US Dollar International Markets
We told you the US Dollar (DXY) bottomed in our 88-90 range in May June and the long side is the place to be…just a whiff of yields rising this week sent the greenback spiking to the upside…unless we take out 92-90..do you really want negative yielding currencies like (Euro & Yen) or how about the Yuan so they can impose currency controls on your $$? We like Mexico and Emerging Markets as they benefit from natural resource on one hand and are quite well sufficiently discounted in the latter to start positioning for the global recovery while Europe is on the verge of potential breakout!
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Crude Oil Natural Gas
We told you for week that ENERGY may be the place to be in Q4 and despite a late week dip we seem to be correct. It’s a volatile animal but we have levels on XLE XOP & OIH plus their components we share. Nat Gas is up big time as well.
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Gold Silver Copper Crypto
We told traders to stay out of Gold & Silver until sustained strength ABOVE key MA’s…so far absolutely correct. Copper prices have been strong but FCX has faded big time…someone’s wrong here…and we told you crypto bottomed in July in both (GBTC ETHE) which again we stand by unless taken out although last week we did say a correction in the cards.
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The agricultural markets are still consolidating and some say bottlenecks and supply demand dynamics (like oil) bode very well that any drop is a pause to refresh…there is a one stop shop for commodities that we share with readers.
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Remember All investing involves risk and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not indicative of future results. Information and opinions provided for informational purposes only. It is NOT advice.