The MARKet Update – 01/06/23

Good afternoon O$ members!

This morning started out interesting with Nonfarm Payrolls increasing above consensus and Unemployment lower than consensus.  The market wanted to see higher unemployment and did not like this initial news and the futures started dropping.  Then we also got news about wage inflation being down slightly which the market liked.   So a mix of bad and good news.  The market recovered from its initial drop in the first 30 minutes of the day and then proceeded to stay steady with a consistant rise finally surpassing the 3900 level that’s been holding us back from a real breakthrough in direction these past two weeks. 

While on the onset this looks very very bullish, we closed around 3917 and back in November when we went from 3750 all the way up to 3980 and then 4090, I wish today’s breakout was stronger and got us to the 3980 level.  Now we’ll have to see on Monday if we can stay above 3900 or if we retrace some to 3880.

The IBM puts we entered on Wed were up 20% after purchase and today they are down 13%.  A 20% profit is always a great place to exit trades on your own.  If you got multiple shares, sell some to break even and let the rest ride.  I haven’t issued an exit alert yet, as earnings are coming up at the end of this month and I believe that $120-$130 is a more fair price and sentiment will change as most tech stocks have succumbed to trading their 1 to 2 yr lows currently, while IBM has been hitting all-time highs in an environment not conducive to unlimited gains.

CPI reports next Thursday, so that will be the next big news catalyst to affect the market.  If the market drops some before this it may be supported at 3880 until we can solidly trade over that 3900 again.