August 6, 2024

Markets:

S&P 500 futures rose slightly on Tuesday after the broad index notched its worst day in nearly two years as global markets sold off.

Futures tied to the S&P 500 were up around 0.7%, while Nasdaq 100 futures gained 0.8%. Futures connected to the Dow Jones Industrial Average advanced 227 points, or about 0.6%.
Helping sentiment was a rebound in Japanese stocks. The Nikkei 225 posted its best day since October 2008, soaring 10.2%. That surge comes a day after the benchmark suffered its worst day since 1987, losing 12.4%.

A major unwind in the yen “carry trade” also contributed to the volatility. The Bank of Japan last week raised interest rates, contributing to a rise in the yen. That’s affected the practice of traders borrowing in the cheaper currency to purchase other global assets.

Many investors have come to view Monday’s sell-off as long overdue in a market that’s reached high valuations and new records, with some cautioning that the pain may have more room to run.

Portfolio:

We enter the new session holding setups in NU, SOXL, and TSLL. Expect continued swings but support was found yesterday.  Now, we need to see how we trade over the next few sessions.  Need to see if a new playbook is developing but wait and see approach now over the next 2 to 3 sessions.  No chance we stay stagnant, the move should be developed from here.  Curious to see if they bring a day of range trading and create a bit of pain for both sides.  Reminder from yesterday, full rotations 5200 vs 5320+ pain range.  

All things considered heading into yesterdays session; carry trade; War threats, Buffet reducing AAPL, etc, every headline was thrown at us over the weekend, MANY stocks found support at appropriate levels and moved quickly off those spots.  Example; AMD, NVDA, SOXL, GOOGL, AAPL, PLTR, etc.  Again, today and tomorrow will be the true tell.  VIX action also in focus for us now.  

Stay patient, this price activity will create the next level opportunity everyone seeks.  Just look at the April action when many wanted to break from the market and then we proceeded to work into new higher for close to 3 months.  Please stay patient there and be rewarded soon enough.