10/13 Recap. What A Rally.

CPI came in hotter than expected, we plunged premarket, and after that we had an incredible rally. I told myself I wouldn’t get excited unless we got a confirmation with a close over the 8 ema, we got that and a close over the 10 ema. We got all that with a massive bullish engulfing candle as you can see below.

Now does this mean the bear market is over? No not at all, just means that for now we have another rally in the cards. I still don’t think people really grasp what today meant. We now have some banks pricing in back to back 75 bps hikes which would give us an FFR over 5%. With an FFR that high, it doesn’t matter if it’s for 1 month, equities will be repriced much lower. Obviously a 5% FFR is not sustainable long term but the FED would look like idiots right here if they backed off before inflation cooled off. When people ask me where do you go long, it’s right here at that line below. See how the market has found its way back to that trendline repeatedly since 2009? It will make its way there again sooner or later. Upon touch of that, go all in, for now you have to stay nimble because we’re in a clear downtrend.

Today’s Unusual Options Activity & What Stood Out

Today had more unusual action than other days so we have a lot to discuss