Trading the Charts for Thursday, May 4th
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Good morning and Happy Thursday,
We got through the FOMC meeting yesterday (PS: Powell is a moron) with another 25 bps rate hike and then within hours we saw PACW tanking 55% when it got leaked they are trying to sell themselves. That news also took down WAL and several regional banks. Hey Powell, I guess the banking crisis is not over yet!!!!!
Still baffles my mind how they can raise rates again after 475 bps of hikes plus 4 major bank failures with several more barely hanging on. Just clueless on every level. It’s beyond reckless not to pause and make sure there’s stability in the banking system before continuing with more hikes not to mention there’s a 6-12 month lag effect on rate hikes so we haven’t even seen the impact from the last 250+ bps of hikes plus the stress in banking system with continue to tighten up the consumer and corporate lending markets plus we can’t forget about the potential landlines in commercial real estate.
With that said, earnings season is actually going pretty well. I’m talking my own book here but UBER crushed it Tuesday, MELI crushed it yesterday and LNTH crushed it this morning. I own UBER in both portfolios but I’d be looking to add MELI and LNTH to my trading portfolio on any pullbacks. FOUR also reported strong numbers today and still looks cheap so I’d love to add that one to my trading portfolio. These are all top 5 positions in my investment portfolio along with CELH.
Right now there’s a 91% chance [click here] we don’t get another rate hike at the June FOMC meeting. I’m on the record as saying I think we see CPI YoY under 3% by end of summer which means these morons at the FOMC have already gone way too far with the rate hikes because they basing their monetary policy on backwards looking data since they clearly have no ability to forecast anything. I honestly have no idea how we ended with an FOMC stacks with this many buffoons. If I explained the current economic and banking situation to my 8 year old niece she’d probably tell us to PAUSE :)
BTW, commodities are still crashing with oil down almost 20% in the past few weeks since spiking after the OPEC cut.
Yields continue to pullback with the 10Y back down to 3.35%
If you think long rates are going longer than TMF is one way to trade it however finding the right entry is a little tricky.
