Good morning, Slopers and Slopettes. Ever since the election, the direction of the market requires a human of at least two years of age to discern. In my mind, I have an image of a bicycle tire being endlessly inflated with neither remorse not consequence:
The small caps have generally followed the same path, although the past two months have been decidedly wobbly. I acquired from May 2021 puts on IWM yesterday. Glutton for punishment, I suppose.
The one chart that captures the “I’m going to break your heart……….again” for me is the NQ. It was shaping up so beautifully, but in retrospect, where I’ve marked with an arrow, things went totally off the rails (or, I suppose, went back ON the rails). Ever since then, this H&S wrecker has been pretty much a vertical skyrocket.
While simultaneously, volatility has been getting the ever-lovin’ life squeezed out of it.
The dynamism in the market should heat up next week, as the really interesting earnings start to come out (let’s face it; watching JP Morgan earnings is not thrill). And, of course, the week after that, things go red-hot. I’ve circled a few of next week’s events I believe will be of note.
