To The Moon

Options Expiry Night = Volatility:

⚠️ Tonight is the monthly event-OpEx, which has a reputation for stoking volatility as traders and dealers rebalance their big exposures in mass quantities, so EXPECT VOLATILITY‼️

🤓: OpEx is Options Expiration which happens on the Friday before the 3rd Saturday of each month in the 🇺🇸 An often referred to effect is the options expiration week effect.

⚠️ OpEx week has seen stocks falling in eight out of the last 10 months‼️

➡️ Twice this week, the S&P 500 has briefly surpassed 4,000 -- a battlefield for 🐂 VS 🐻

➡️ The benchmark gauge has fallen in 3 of the past 4 sessions, after jumping more than 5% last Thursday on promising inflation data that sparked a wave of short covering and call buying ➡️ Today’s options runoff may expose stocks to further price swings‼️

👀 Look At How High Not Just How Much:

Just as investors heaved a sigh of relief & pulled off a 🐂 rally after better than expected Oct CPI & PPI data, various Fed officials have come up with their 🦅hawkish 🎤 again…Latest is St. Louis Fed President James Bullard. He said that:

(1) Policymakers should raise interest rates to a MINIMUM of 5% to 5.25%🔥🥵 A 25bps increase from his previous 4.75% to 5% prediction…

(2) Fed’s short-term rate may have to rise to a level between 5% and 7% in order to 🧯🔥stubbornly hot inflation😱

(3) Despite inflation is starting to ease somewhat, but it still remains extremely hot🔥🔥🔥 as consumers continue spending amid a very strong jobs market.

⚠️ The central bank has already raised its key rate to a range of 3.75% to 4% up from nearly zero as recently as last March. Despite investors hoping that more signs of easing inflation could help the central bank shift to less aggressive rate increases, the central bank has been CLEAR about CONTINUALLY raising rates, possibly to unexpectedly high levels, to tame inflation.

Some investment strategists think that the markets have gotten a little bit ahead of themselves after getting encouraging reports on consumer and wholesale prices easing a bit.

🤔💭My Thoughts:

(1) After Oct CPI data, VIX dropped significantly but is climbing up, suggesting that fear is once again creeping into investors.

(2) Comparing the 🐂 rally in June-July which didn’t last, the recent rally is even weaker, so I'm 🐻-ish for NASDAQ & the S&P 500 on the short-term until the Dec Fed meeting gives greater clarity. 

(3) As investors weigh higher interest rates, consumer spending will decrease & people will likely delay purchases for properties & cars, so I’m 🐻-ish for $Tesla Motors(TSLA)$ $NIO Inc.(NIO)$ $XPeng Inc.(XPEV)$ 

(4) I will look for dips to buy $Taiwan Semiconductor Manufacturing(TSM)$ $Apple(AAPL)$ GOOGL, AMZN, XPENG,BABA.

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As usual-🤔💭 Consider POV & Actions of investors + 👩🏻‍💻👨🏻‍💻 Research + 🗑FOMO & Greed = Investing Wisely 🤓🤗 + Accumulating Wealth 💵💰

Source Website: Bloomberg

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