1/5 Recap. Good News Is Now Bad News.

The data we got today about more people being on payrolls was just another datapoint showing the fed has no clue what it is doing, but it also just cemented the fact that the fed will continue what it has been doing for a lot longer than people thought, which led to the selloff you saw. Tomorrow morning we have the jobs number and that number should finally break us out of that range we’ve been in. Up or down, I can’t tell you today, but I know we should have an extended move afterwards in whatever direction we are given. No sense trying to guess what is coming, simply play the trend after we get it.

The SPY as you can see below again closed in the tight range it has been in, it’s been 3 days of 2023 and my prediction of the market doing nothing this year has so far come true. Tomorrow’s big levels to watch are a close over 386.23 or a close below 376.66. Those are the only levels that matter and anything in between is just more chop, If I’m being honest, it looks like lower is the move, every rip higher is sold and we’re in a bear flag that looks like it wants to break down. Of course I’m positioned mostly neutral with my put sales, so either outcome is fine with me, but I would prefer higher if you want my answer on that topic.

The dollar continues its move higher, this is a pretty strong looking setup. Naturally 2 days after Jim Cramer said the dollar was going lower, it now looks like it wants to have a nice run. This is also part of why I think the next move is lower for the market. The RSI and MACD are pointing up and that is the last thing stock bulls want to see.

Oil had a nice bounce, but the technicals here are still shot. All the moving averages are sloping down, this is going to be ugly for some time. Those moving averages all have to come down, flatten out, and be reclaimed before I can say oil looks good, this is a process that doesn’t happen quickly, it will be weeks if not months before you see oil charts stabilize.

Today’s Unusual Options Flow & What Stood Out

I wanted to start this off by pointing out that in yesterday’s recap I mentioned some NVCR call spreads, this name ended up 69% today to close at $118.81. Almost perfect trade put on by whoever bought those yesterday. I don’t trade biotech stocks, but I do follow option flows and this is a big reason why, the dirtiest of trades go on in there and a keen eye can catch them.

Alright with that out of the way, let’s get into today’s unusual flows