The Morning Call
4/15/26
The
Market
Technical
Tuesday in the
charts.
Summary:
For stocks, it's a 'mission accomplished' moment as the
S&P joins NDX and RTY in the green from pre-war (as tech laggards lead the
charge). Optimistic tones from both US and Iran pushed stocks
up, bond yields down (along with oil prices), and the dollar down. Gold and
crypto also rallied bigly as central bank expectations drifted dovishly. As one very senior equity
trader said: "Flows remain one-way... CTAs, clients, everyone is
under-risked and chasing."
Note: the Market
continues its relentless drive to the upside. Obviously, I was wrong about closing
the huge gap up open---at least in the short term. Just to rub it in, the
S&P executed a second gap up open yesterday. So, it would appear that the
current situation is the exception to the rule. Having been wrong, I don’t want
to compound it by panicking into the stocks on my Buy List. So, I am still
going to wait for a correction to define support and give me an entry point.
Tuesday
in the technical stats.
https://www.barchart.com/stocks/momentum
https://www.barchart.com/stocks/market-performance
https://www.barchart.com/stocks/sectors/rankings
https://www.barchart.com/stocks/signals/new-recommendations
A thought on the rally:
“Momentum-driven traders are too loath to miss out on a rally to worry about
what is driving it,” Steve Sosnick, the chief strategist at Interactive
Brokers, told Bloomberg.
Market performance
after a seven day winning streak.
https://www.bespokepremium.com/interactive/posts/think-big-blog/one-streak-ends-others-make-history
Buy stocks when
the VIX is over 30.
https://giftarticle.ft.com/giftarticle/actions/redeem/f1260576-7051-4a40-bfa6-056290a89530
CTAs unleash
buying spree.
https://www.zerohedge.com/markets/largest-forecast-over-decade-ctas-unleash-historic-buying-spree
Summary:
the bank now estimates CTAs will buy $83.5bn of global equities over 1 week
in a flat tape, of which $43bn is US Equities, "this is a +4 standard
deviations move", Armbrust exclaims. For Goldman, "these
are the largest flow forecasts observed in the model over the past 10
years."
The latest from
Goldman.
Summary:
VIX expiration tomorrow (4/15) through OPEX (4/17) to clear short VIX/vol
bets, and remove positive gamma. This should allow for markets to have more
volatility... Throwing everything into the blender, here’s my market view:...the primary
bull trend remains intact......yet, the core growth /
inflation tradeoff has worsened, and growth should slow in the second
half. I think this all reaffirms my recent point on the tactics of
near-term execution: build longs on sharp pullbacks / add protection on
days like today.
The chase will hurt.
https://www.zerohedge.com/the-market-ear/squeeze-paid-chase-will-hurt
Summary: The squeeze has done its job, now it’s
starting to pull people back in. Positioning has flipped, volatility has reset,
and equities are back pressing key levels. What was a clean, one-way setup is
turning into something more dangerous - flows still support, but signals are
starting to stretch. From here, it’s less about direction, and more about not
getting trapped chasing it.
Wednesday morning
setup: US equity futures are flat following yesterday’s rally as market awaits
news on the Iran war resolution and as we traverse earnings season. As of
8:15am ET, S&P 500 futures are little changed after the benchmark closed
within a whisker of a record. Risk sentiment took a small knock in recent trade
after Iran cautioned that it will not allow shipments to or from the
Gulf if the US blockade remain. Nasdaq futures are fractionally in the
green, and set for an 11th consecutive gain as the massive
short squeeze/CTA forced buying continues: in premarket trading, Mag7 / Semis
are mixed, Discretionary and Staples are both stronger, Fins / Indu are leading
Cyclicals with weakness in Materials. Bank of America and Morgan Stanley rose
in premarket trading as their equity traders posted strong revenue beats.
Europe’s Stoxx 600 traded flat, while China’s mainland blue-chip index became
the latest in Asia to recoup losses since the Iranian war began. Brent
erased early losses to rise 1% toward $96 a barrel as the US pressed ahead with
a naval blockade of the Strait of Hormuz. Treasuries edged lower, with the
two-year yield rising one basis point to 3.76% and the 10Y rising 2bps to
4.27%. The dollar is slightly stronger which would break a 7 session losing
streak if gains hold while gold fell toward $4,800 an ounce. Other commodities
are mixed with Ags, Base metals, and the Energy complex ex-natgas bid. Today’s
macro data focus is on Beige Book, TIC data (keep an eye on buys/sells of
Trsys), Housing prices, Empire Mfg, and Import/Export prices.
Fundamental
Headlines
The
Economy
US
Weekly mortgage applications
rose 1.5% while purchase applications were down 1.0%.
Month to date
retail chain store sales were up 7.0% versus +7.6% in the prior week.
The
April NY Fed manufacturing index came in at 11.0 versus forecasts of -0.5.
International
February
Japanese machine tool orders were up 3.6% versus predictions of -1.1%.
February EU industrial
production grew 0.4% versus estimates of +0.3%.
Other
Iran
Overnight news: Effort to extend US-Iran
ceasefire has made progress, AP reports citing official; mediators aim to extend the
ceasefire for at least another two weeks; both sides gave an “in principle
agreement” to extend the ceasefire.
The Pentagon is
sending thousands of additional troops into the Middle East in the coming days,
WaPo reports citing US officials; in a bid to pressure Iran while mulling the
possibility of additional strikes or ground operations if the ceasefire breaks.
US Central Command
said blockade of Iranian ports has been fully implemented and that US forces
have completely halted economic trade going into and out of Iran by sea.
US has intercepted
eight Iran-linked oil tankers since the start of the blockade.
New satellite
images show Iran digging for missile launchers trapped underground amid a
ceasefire.
More than 20
commercial ships have passed through the Strait of Hormuz in the past 24 hours.
The blockade from
Iran’s point of view. I have read dozens and dozens of articles on the
economics of the closing of the Strait of Hormuz and I have seen nothing that
confirms the math of the author with respect to Iran’s oil revenues since the
war began. That doesn’t mean the author is wrong; but no one else seems to be singing
his song. So I have to question his accuracy.
Fiscal
Policy
The only way to stop the growth of government
spending is to cut taxes.
Yet another big monthly deficit.
Inflation
Everyday prices jump.
https://econbrowser.com/archives/2026/04/everyday-prices-jump
Not
your grandfather’s stagflation.
(3)
Not Your Grandfather’s Stagflation - by Quoth the Raven
Recession
Unemployment claims as a recession indicator.
Affordability
New home affordability in February best in four
years.
https://politicalcalculations.blogspot.com/2026/04/new-homes-sold-in-february-2026-are.html
Where did all the affordable cars go?
https://econbrowser.com/archives/2026/04/clifford-winston-on-where-did-all-the-affordable-cars-go
The
Financial System
Private
credit has calmed the credit cycle.
https://giftarticle.ft.com/giftarticle/actions/redeem/34307f76-2c4b-4216-8794-1583d71b3b7d
Investing
Diversification is
the only free lunch in investing.
https://alhambrapartners.com/weekly-market-pulse-the-only-free-lunch-in-investing/?src=news
The basics of
building wealth.
https://dariusforoux.com/the-basics-of-building-wealth/
Risky debt
outshines Treasuries.
https://www.capitalspectator.com/in-wartime-markets-risky-debt-outshines-treasuries/
What do you
believe about investing?
https://behaviouralinvestment.com/2026/04/14/what-are-your-investment-beliefs-2/
Are you an analyst or an investor?
https://microcapclub.com/are-you-an-analyst-or-an-investor/
News on Stocks in Our Portfolios
What
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