Before I begin, thanks to all the new subs. You will start receiving emails tomorrow morning. We got so many new people today that we couldn’t get them all on the distribution list. And if you want a PDF on DeMark indicators, email me
My friend Le Shrub, who many of you know on Twitter and has a Substack that is awesome, has often said a trade can be a “Blood Sacrifice.” It’s a matter of taking a loss to have an overall gain. “🙏 blood sacrifice has to be paid, the Gods are happy.” I’m selling the Coreweave long I bought after the 10% gap down, which is now down more. I’ve said it’s “tricky to buy oversold in an overbought market,” and it couldn’t be truer on this one. But overall, tech is down, and I’m short a lot of tech, so I offer a blood sacrifice.
Quick Market Views
Stocks: Terrible breadth with some defensive positioning as seen recently continues – with consumer staples, healthcare, and energy. Downside followthrough has been elusive so watch tomorrow and Friday. The short term 60 minute charts have new downside Sequential Countdowns in progress but both indexes remain over the November 7th lows for now.
Bonds: Rates are up 3-4bps
Commodities: Mixed with Natural Gas up 1.6% (sorry I sold my long maybe a little early yesterday). Crude up 0.45%, Grains doing ok, Copper and Gold both down 1%, Silver down 2.25%
Currencies: Dollar index down 0.3%. Crypto getting hit hard with some making new recent lows. Bitcoin is down 3.3% and under 100k again – see below
Current Portfolio Ideas: Portfolio now +18.6% vs SPX +14.4% YTD
Changes: Cutting the 2% weight CRWV long. The short term SPY and QQQ momentum flipped back to sell – see below.
Thoughts: Refer to yesterday’s note as I reviewed some current short ideas.
US INDEXES
S&P futures 60-minute tactical time frame with new downside Sequential in progress and above the November 7th low.
S&P 500 Index daily, weekly and monthly all have DeMark exhaustion sell signals in play. Getting follow-through on the downside with the daily has been elusive, so watch tomorrow and Friday. Breaking the recent weekly low bar would also provide some confirmation.
Nasdaq 100 futures 60-minute tactical time frame also with downside Sequential in progress and above the Nov 7 low.
Nasdaq 100 Index daily and weekly charts with DeMark exhaustion signals remaining in play. Follow-through has been so elusive, so this needs to be watched tomorrow and Friday.
Current Portfolio
Blood sacrifice CRWV long idea is being sold. It’s ALWAYS tricky to buy oversold in an overbought market.
The short term SPY and QQQ flipped back to sell. If you’re pressing this look at the support with the red line which has been decent support. Breaking the 650-655 level the lows from October could see this really fall off a cliff.
Bitcoin is under pressure in downside wave 3 of 5.
IBIT Bitcoin ETF making a new recent low possibly trapping 5 months of buyers. In downside wave 3 of 5
Tesla is breaking down with the VWAP from the day Elon filed his big open market buy is 438 – potential trapped buyers. That’s the solid orange line
Charlie with red-highlighted comments
Charlie from Nomura has a way of highlighting his comments in his notes with green/red comments. It’s almost you can just look at the color and know his view. A lot of red today. He has been all over the risk with the levered ETFs.
The good news is that the levered ETF AUM growth is no longer at the 100th percentile. The bad news is it’s only dropped to the 99.5% percentile.
Grandma’s money
Tom Lee, a CNBC financial pundit, has raised a boatload of capital for his ETFs. Going on TV each day with the same message to buy stocks seems to have worked. Kudos to him, however, it might not be done topping with recent DeMark Sequential and Combo 13’s at the upside wave 5 top.
“Hi Grandma, I just put all your money in this ETF called Granny shots.” Largest inflow since inception yesterday. Risk of trapping people if the ETF falls more.
Hedge Fund Telemetry ETF Percentage Price Oscillator Monitor
The PPO monitor (percentage price oscillator) force ranks ETFs by percentage above/below the 50-day moving average. This monitor and others are offered to Hedge Fund Telemetry subscribers on Bloomberg. Nasty day.
Index ETF and select factor performance
ETF with today’s performance with 5-day, 1-month, and 1-year rolling performance YTD. Defensive ETFs have been working in the last 5 days as I have mentioned for a few days now.
Goldman Sachs Most Shorted baskets vs. S&P Indexes
This monitor has the S&P indexes and the Goldman Sachs most shorted baskets. Short baskets are down hard. Most shorted tech down 9.99%
DeMark Observations
Within the S&P 500, the DeMark Sequential and Combo Countdown 13s and 12/13s on daily and weekly periods. Green = buy Setups/Countdowns, Red = sell Setups/Countdowns. Price flips are helpful to see reversals up (green) and down (red) for idea generation. The extra letters at the end of the symbols are just a Bloomberg thing. Worth noting:
If you have any questions or comments, please email us. Data sources: Bloomberg, DeMark Analytics, Goldman Sachs, Street Account, Vital Knowledge, Daily Sentiment Index, and Erlanger Research