Option Professor-Stock Market-Is the Pandemic Over? Stocks Say Yes! Read This!
November 5 2021 Option Professor Inc Opinions & Observations
This Week we got big numbers out of ISM Services (if everybody’s spending on experiences-they’re also tipping so of course workers returned after benefits ran out). We also got a wimpy Fed & ECB & BOE who continue to fight a War that’s already been essentially won-employment (jobs although we remain 4 mill under pre covid but with productivity & retirements they ain’t comin’ back). The Central Banks are betting the pot that inflation will back off when easing of bottlenecks (ships will ultimately unload) and prices will fall under their own weight (Zillow’s failure @ flipping houses & many sellers cutting asking prices). Maybe so but higher wages (employment participation rate still low) and higher rents aren’t dropping after being raised. The jobs report should have been a yawner as anyone who’s been to the stores, out to eat, at a casino knows it’s game on. We have officially switches to buying things and stay at home to doing things and going places. Our trip to Hawaii that we booked a little while ago (Thank God) would be substantially higher if we booked to day. So it is out with PTON & ZM & DoorDash and in with Eats (Shake Shack-Bloomin’ and the Cheesecake Factory) Travel (Expedia MAR HLT CCL ect) plus AAL DAL Entertainment (LYV AMC MSGE). Cutting to the chase….we have earnings and operating leverage and margin expansion (all good) and we have demand coming out of ears (good) and we have no alternatives to be found (yields are a joke on fixed income and prices/valuations sky high) and we have many investors under invested (positioning) and we have $2 trillion in excess household buying power going into a holiday season nad we have central banks spraying gasoline on the fire or at least standing idling by with dovish stances……THIS WEEK we get PPI & CPI (inflation numbers) out of USA & China PLUS industrial production in UK & Eurozone. Overbought so do we get choppy here as VIX moves up….maybe but by Turkey Day & JAN EOM.-OK We have our Fibonacci target at SPX 4724 area (61.8) & had 4660 (38.2) the latter blew out the former still held Friday
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As we said before we have an everything rally going on but rotation toward energy-value dividends-may be at hand. Semis pot stocks travel and leisure had a big week last week….email us [email protected]–get our research
If you get our research; you know our position gas been that the 10yr Treasury topped in March at 1.75% and EDV and TLT bottomed in price at the same time…we stick with that call….email us at [email protected]–Get our ideas
US Dollar & International
The Central Banks worldwide (major ones) punted the ball and our yields dropped as in comparison they look like King Kong so our US Dollar (DXY 94+) has been rising a bit toward what we see is a wall of resistance (94-96) so we will see where it goes from here. International markets look interesting to us as we have a RECORD trade deficit which to us means that overseas firms should make a bundle. China is a nightmare (real estate-covid-blackouts) but even nightmares end so we look for a possible turn BEFORE the Feb 2022 Olympics email us at [email protected] and get our ideas on investing in the Pacific Rim-Europe and the Emerging Markets.
Crude Oil Natural Gas
So far a mild fall/winter is saving the demand crunch as OPEC+ won’t go beyond prior supply hikes and our reserve are on the table but not yet on the market. TIME…it takes time for rig counts to get up and investment to occur (free cash flows going to debt repay-dividends and buybacks)…supplies still way under pre covid an so the ratio remains tight. Natural Gas prices have come off but a lot will depend on demand this winter email us @ [email protected] tp get our picks on where and how to gain exposure to what could be a very exciting energy market dead ahead
Gold Silver Copper Crypto
Well is it real or not…we have seen many head fake in Gold & Silver in the last few months and Friday we saw another as Gold got above & closed above $1800 and Silver approached $25 but did not exceed it. We hve told you we suspect the lows are in from the recent pullbacks but want $1850+ & $25 + to feel that we got a green light. Copper is still in short supply and if we get an infrastructure bill…could be supportive..back above 4.50 needed. We told readers in July that BitCoin & Ethereum (gong green in 2022) bottomed (GBTC ETHE) and we only are interested on dips (100K EOY?) Simply email us @ [email protected] and learn the best ways we see getting exposure to these markets
Soybeans Sugar Coffee
Soybeans trying to hold around 12 and if successful and closes above 12.50 could be a legitimate turn. Sugar and Coffee were big for us last year but now are consolidating…more data needed to discern accumulation or distribution
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