UPDATE Nov 6

A quick post.

That was a big fun rally.

Now, let's get serious.

Why would you want to buy anything here? 😕 if your answer is "rates are coming down," - you had better hope not. That would be admitting they screwed up, and there is something broken. Truth is something(s) are broken. But Powell still CAN NOT cut rates. Inflation would soar. I've already explained why and I won't go into it again. Now, when these markets fall and disinflation sets in, he can (but shouldn't) and will lower rates. *This will lead to a rate yo-yo for some time, until he raises again like mad. If you read that carefully, you'll notice I said after the fall. That's because this market is coming down. the 350 billion in bond auctions this week will let you know.

Why? or how do i know?

Because money goes where it's treated best. where is it safe? and where can it earn returns? Here is the calculation

you could buy stock "XYZ" and hold for the next 3 months. (insert the stock you would most like to own)

or

you could buy a 3 month t-bill and earn 5.2% interest guaranteed 🤔 if you have to think about that, you would not make a good money manager 😆

Money wants out of where it's at. It wants in the t-bills. Not bonds or notes, or stock, or... only t-bills! t-bill and chill 😎

This is going to act as a giant money vacuum. I won't even start down the rabbit hole that is bond derivatives, but those are coming someday, too. And if you thought the 2008 derivative crash was bad, that is child's play to what's coming. that was a 15 trillion dollar market. the leverage on bonds, I believe, was one quadrillion dollars. That's not a misprint. there is more leverage than money on earth. How's that going to unwind???? but I digress.... That's not yet (I think 2025?). I think they will try to reset the system by then... OK, I went into the woods there. let's get back on track.

I wouldn't want to own anything here. The rally last week was a result of Gamma and a lack of bond auctions. (No bond auctions means money is freed up to go into stocks)

Here is my prediction for the upcoming week(s). (prediction in white)

and here is the bond market. this shows the end of free money. That is the end of the 40-year bond bear market. Now that the bear market is over, the bull market begins. That means competition for stocks.

Those numbers to the left are the multiple that's stocks are trading at compared to earnings. They are currently trading around 17%. you will hear "pundits" say that is "normal". that's only normal since low and 0 interest. historically, the average is nearer 4%. I see it coming down to a 6% multiple.

the market has been fighting the inevitable. ⏳️

NQ could still push up near 15300 or reach that on the rebound. The pullback and where and how it holds should be telling. I would like to see a pullback below 14800 and closer to 14500 or lower.

we could push up to ~372. I would expect some "chop."

when this is over, i want ENERGY. Uranium, Oil, NatGas, Coal.

Be Safe, Be Careful, Be Wise

and as always

Good Luck