1/x The market has been in desperate need of refreshing...& SO, w/ Vanna & our charming sloth are still off enjoying their vacation @ the🏖until 12/25-26 in this seasonally weak period, & the market a bit overbought, & Sentiment (low short interest/low Put Call ratios) near ATH’s
2/x & w/ a lack of breadth & underlying weakness from NDX market leadership, like TSLA (where skew & bearish flows have showed signs of a potential crack in the edifice), W/ index skew @ the 95th+%, fragility on the tails increasingly dramatic, also displayed in historic VVIX/VIX
3/x extremes...the market APPEARS to be doing just that. We seem to be 6 days into our called 1.5 week period of correction in time/price. as mentioned, if we’re unable to break our important technic support & Gary’s able to hold his grip above the 1 stdev down of 20 day(2 days)
4/x by 2/26. This correction should be bought into for another retail driven meme stimy shopping spread & reopening exuberance ahead...B/c despite all the obvious headwinds, ONLY 1 THING MATTERS right now, & That’s DON’T FIGHT THE TREASURY... w/ 1)new $1400 stimy checks hitting
5/x retail bank accounts again in early Mar & 2)increased narratives surrounding a likely coming huge BBB infrastructure plan reveal @ the coming SOTU all while 3) we’re likely to see an accelerated spring reopening... this coming run could be something to behold, particularly in
6/x certain pockets of the market... but the steep rally’ll likely be relatively short lived, for by the time the infrastructure bill begins to get traction, 1)Taxes’ll come due in mid April, 2) it’ll be time to realize LTGains from last March’s buying... & maybe most importantly
7/x 3)the economy should begin to reopen, diverting precious $$ & attention from retail equity demand back to the real economy while 4)pushing yields up & diverting even more $$ from stonks back to bonds, as TINA ever so slightly begins to unwind...that 1 could very well get ugly
8/x as the old SELL IN MAY & GO AWAY adage, LIVES UP TO ITS REPUTATION. In the meantime, it is time to play for a bit of mean reversion starting tomorrow into THURSDAY. Watch carefully for signs of fixed strike Vol unpinning Gary. Watch for increased fear by retail in the form of
9/x higher put/call equity & watch a potential test of the 20 day SMA or even 1 std dev down of the 20 day for strength. Ultimately, as is usually the case, time’s on the side of the bulls...But the🪟continues to be open for potential continued weakness & it’s still a time for
10/x caution for a few more days... If someone can manage to take Gary 🦍’s 🍌’s away with a drop below our technical break, things could get ugly this week, but that big of a break seems increasingly unlikely. We continue to buy cheap hedged long index calls, & cheap downside
11/11 convexity funded w/ local Vol & long TSLA collars for convexity for a few more brief days in this🪟, 👁ing an opp to catch the next nuclear rocket-ship🚀to the🌙, if/when the 🌟✨ align... YOLO. Pick you’re spot on a coming correction & ride it w/ a tight stop. Good luck!🍀
🤦♂️ your. @jack edit button please.
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