Respect The Market, Like Bitcoin More

Video Length: 00:43:24

A trader’s job isn’t to have opinions about the market, it’s to make money. So, if the market is performing well or telling us something, we listen.

We’ve been concerned about the fundamentals of the market, and specifically the fast spike in interest rates. That can dislocate algorithmic trading, and it can cause a big drop fast, a 5%-7% down day sort of move. We think that risk is still out there. But the S&P 500 and the SPY finished above our bullish levels last week, so we respect that.

There are still things happening underneath the surface, and we’ve been adjusting the model portfolio exposure we run to account for that. Adding the DIA and IWM and even a little XLF at times gives us exposure to market upside, while acknowledging that the reopen trade and market rotation is happening, which has made us short the QQQ in our model portfolio.

All of those factors also leave us pretty positive on Bitcoin. Inflation, near-term technicals, its undervaluation compared to gold on a market cap basis, all of that leaves us thinking that Bitcoin can work in the near term and in the long term.

The video discusses all of these points in more detail.

00:30 - Reviewing the market key levels

  • What’s behind the numbers

  • The continued threat of a spike of interest rates

  • Adjusting exposure for the current interest rate and market environment

8:00 - Why respect the market

  • Focus on what’s working

  • Make sure fundamentals and technicals line up

  • The market can overwhelm traders

10:45 - What is keeping us from being fully bullish

  • The spiky jump with interest rates

  • The risk reward and expected probability-weighted outcomes

  • Adapting to this situation

  • Inflation expectations could play out negatively

  • Reopening trade trends bear watching

17:30 - What to watch for this week

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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Disclaimer: All investments have many risks and can lose ...

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