This market is horrible. There are no other words to describe the day to day panic over rates, war, whatever. We’ve completely lost touch with the idea businesses still have to function and some will do well and some won’t. Instead everything just trades a factor of 1. Hopefully as we begin to see more earnings and guides the next few days we can begin to sort the weak from the strong but for now every sessions seems to rely on what fed speaker said what or what datapoint that was irrelevant 5 years ago are we going to point to for today’s reaction.
Look at this Nasdaq reaction today, it’s just a casino of market for now, not really much substance to look to. Everyone seems positioned for the worst, it isn’t occurring, and we just hone in on every little datapoint trying to will something into existence. The numbers we’re seeing are just not showing anything bad if you consider the weighting of equities.
The SPY remains below the 8 ema and above the 200 day. Ideally we would see a push higher but I said a few days back I wasn’t expecting much until big tech reports and we really haven’t done anything since.
On the good news front, we got some encouraging data from Netflix yesterday. Not only were the numbers good but they’re hiking prices. So again lots of fear over the consumer is really overblown, if Netflix was worried about the consumer they wouldn’t be raising prices. Tesla on the otherhand finally cracked on some terrible numbers including awful margins, it is down 9% right now. I don’t think Tesla is much a read of anything as there is a limited amount of people interested in electric cars and plenty of competition now. Moreover, they simply make cars and people who thought it was a tech company are getting a rude awakening. Car companies don’t carry such high valuations, but again Tesla is a retail driven name, very few funds hold big positions even though its one of the largest market caps.
A secondary bit of good news the TNX below approached that 50 level that was going to be big resistance and it is putting in a very ugly reversal candle for now, we will have to see how the rest of the day goes. I don’t know what’s left to say regarding rates. Yellen says we can finance both wars in Israel and Ukraine and the fed keeps wanting rates higher as all this new debt is issued. Math and logic don’t seem to agree with that notion but when has that ever stopped our government from pushing forward. You have to think rates will cool off if we’re going to be issuing $100b of new debt to finance these wars like the president asked for.
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