Fall
Fall • April 29
Stair step up, elevator down. The bears are out.
Bull hopes for a retest were blown as SPY 450.01 rejected and the indexes began rolling over hard. I’ve been saying how lucky I am to be long the FAANG names except for FB & NFLX, which concerned me coming into this week’s earnings. Now my Roth IRA core of big cap tech hurts. This was a make or break week for the market, as these stocks make (made? haha, too soon) up a large portion of the indexes.
Everyone is looking for SPY to break 400. The VIX is hot at 33. The seasonally best performing month in the market, this April was the worst since 1970. Funny enough, in 1970 inflation was at 5.5%, before going to 14% over the next decade. Coincidence? Okay how about this. Worst performing month for the Nasdaq since 2008. I don’t have to tell you tech hurts, Cathie can.
Fed meeting coming up this week. I’m praying for a 75 basis point hike. Let’s really go at inflation. Let’s remove the idea that a mid-meeting hike is on the table. How wild would it be if we hiked 75 bps and the market ripped on the news. Anything is possible.
The Fed is here to nuke the market. As your stocks go down, you feel poorer, reducing the ‘wealth effect.’ You slow down spending, the economy slows, and inflation [is supposed to] slows down.
I think SPY breaks 400, and your next volume node is between 390-395. I’ve left the early 2022 channel on the chart, and the market actually looks like it wants to touch that level before looking higher. Chart above from April 19 to show the levels you’ll see below. Since added an upper trendline and some goofy arrows as my best guess. Cool to continue seeing weekly levels respected (fail to take back 428 – yellow line).
Also fascinating how well Fibonacci’s work on charts. VIX hourly chart going back to February. I’ll get on my golden ratio fanboy session later (but look at the candles touch the levels!). VIX has room to the upside, but you may see a relief bounce in the market in the very short term.
Finally, oil. The equity charts don’t look great – they need to hold, or will roll over with everything else. Mind you, in tough markets, well-performing stocks become sources of funds. High beta stocks will really tumble if momentum takes hold. I like oil long term, but things are rocky right now. That inverted hammer doesn’t look pretty, and forms yet another lower high.
Imbriglio's Pizzeria Napoletana (Newport, RI)
∙ Loretta: (Margherita – San Marzano Tomatoes, Fresh Mozzarella, Fresh Basil, Parmigiano Reggiano, Extra Virgin Olive Oil) ∙
I rolled into Sardella’s Restaurant around closing time to see if I could snag an Imbriglio’s pie while traveling to Newport for work. The staff was thankfully accommodative – note: if you show up before closing, you better be extremely considerate because the staff wants, and deserves, to go home. I had a martini and hung out with the bartender while I waited for the pizza to finish.
I was immediately hit with vibes of Rye Brook (NY), where I worked and ate many a pie. The crust was delicious – supportive as you’d hope from a Neapolitan, but in no way tough. The sauce flavors were delicate and fantastic, which is to be expected from San Marzanos. The parmigiano was a very nice touch – appreciated even from someone like me who isn’t too cheesy. Was the basil a little worse for the wear? Sure, but who cares? It was late, and honestly, basil grows like a weed. If you make pizza at home and don’t have a basil plant, what are you doing with your life?
I was thoroughly impressed by the production, especially when considering the staff let me slip in right before close.
