There’s a lot of data coming out in the US and Internationally this week
It really gets wound up on Wednesday and a finale on Thursday with CPI; so have your game plan ready by Tuesday at the close.
Last week was annoying to many of us. There’s no chance of a Fed Pivot right now, yet the market was running on that. Mon-Wed were frustrating. I was bleeding and found no reason for it except delusional beliefs. By the end of the week, we were almost back to where we started. Silly bulls.
Stay focused on the DXY and TNX - if they’re moving up, SPXY should be moving down. If SPY is going in same direction, it’s most likely going to get smacked at some point because TNX/DXY carry more weight and are more often accurate.
UK has such a mess on their hands, their data is just going to cause more chaos.
US PPI and FOMC minutes being released on Wednesday are likely to be a non-event in the face of CPI on Thursday premarket. I don’t know how much more hawkish we’ll see in the minutes from what was said then and then the last few weeks of these guys being all over the place talking non stop.
Let’s talk about CPI. Headline should cool for this print, but not Core CPI. That is the only one that matters for Thursday. You know the drill by now on how market will respond to higher/expected/lower print on Core CPI.
I’ll be playing an options strangle ahead of it, I expect it to move at least 5-7 points off the data (last time it moved WAY more than I thought it would)
We should be getting near the end of hot CPI readings. I’d expect the next one in November to favor the bulls. With these oil prices rising, maybe not though - we’ll need to see when we get closer.
Regardless of what CPI print is, we’re headed into earnings season - starting this week - and it’s going to be popcorn worthy. I’m expecting to see lowered guidance, no guidance, ‘sorry we missed, the stupid USD is killing us’ and just general companies whining, all trying to get Papa Powell to ease up (he won’t). Note that this is the last CPI update until we’re done with the major earnings.
Pepsi is on Wednesday, Delta on Thursday, and bunch of Financials on Friday. AAPL is end of the month (~Oct27)
We’re going to see quite a lot of volatility this week - so keep your dates out there where you’re comfortable to give yourself some time to be right again if it takes a turn on you short-term. I’m in mid-November now with mine.
I thought the volume was important on Mon-Wed. It was higher than normal on increasing SPY price. That to me said there’s a LOT of money sitting on sidelines waiting on any go signal at all. While it was a false start to jump in on the Fed Pivot nonsense, it does show you just how much powder is ready to go when the tide starts turning - and it will. There will be an epic rally on that.
I’m still fully bearish for foreseeable future.
Thoughts - Technical:
SPY levels: 350, 355, 358, 363, 373
Chart - Weekly: Bearish - Mon-Wed tried to reverse the trend, but it got clapped. More down still to go…
Chart - Daily: Bearish - more to go.
Chart - 4h: Bearish - same, more to go - 355 maybe on to 350?
Trading Plan (Monday):
I’ve got no position currently.
I’ll be looking for any Monday pop at all to enter puts on. Would like to see 365 as entry, though 363 might be all I can get.
If that plays out, then I’d look to hold into Tuesday, maybe even Wednesday afternoon. I’ll close out then at the latest and set up the strangle for Thursday’s CPI data release. 🍿
Putting the long-term SPY chart below just so you can see where we are on the projected path….
