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Tuesday’s Rally, Island Reversals, 5 Observations, Metaverse, Apple in China

Rally cap? Or a cap rally? On Wednesday morning, European traders sold Tuesday pops. They sold stocks, cryptocurrencies, and goods. After trading on the $ 110 / $ 111 handle on Tuesday evening, I saw WTI crude trading on the $ 103 / $ 104 handle. However, capital was flowing back into US Treasuries earlier this morning. After harvesting 3.3% at the end of Tuesday, you can see the US 10-year bond paying 3.22% as the night creatures pass through my trash can.

“Tuesday was a pretty rally. The S & P 500 rose 2.45% and the Nasdaq Composite index rose 2.51%. Small caps were hot, but not so much … Russell 2000 was 1.7 after last week’s erasure. % Recovered. There was definitely a fairly low level of short cover on Tuesday as algorithmic traders sniffed blood in the water and squeezed something. Profit taking works in both ways. Don’t worry. Please.

On Tuesday, all 11 S & P sector-selected SPDR ETFs rose, led by last week’s Paria Energy (XLE), up 4.01% in the session. Expect a significant portion of that execution to unravel on Wednesday. Consumer Standards (XLP) and Technology (XLK) are two sectors that are not normally considered to be correlated, up 2.62% and 2.28% today. Semiconductors were a bit hotter than the wider market. The Dow Jones US Semiconductor Index recorded a 2.92% increase and the Philadelphia Semiconductor Index was 2.75%, led by manufacturing equipment providers Applied Materials (AMAT) and KLA Corp (KLAC). These two increased by 5.94% and 4.9%, respectively.

In terms of width, the winner beat the loser roughly 5-2 on the New York Stock Exchange and almost 9-4 on the Nasdaq Market Site. The increase in trading volume accounted for 79.8% of the New York Stock Exchange’s combined trading share and 72.3% of the NASDAQ listed stock index. Although total trading volumes declined from Friday to Tuesday, this is not an apple-to-apple comparison as Friday was a “triple witch” expiration event. Total trading between members of both the S & P 500 and the Nasdaq Composite Index is the lightest on any day since last Tuesday, suggesting that not everyone attended the rally on Tuesday.

Islands in the stream

Readers will see Jerome Powell’s twins appearing with a legislative committee set up for today (Wednesday) and tomorrow, a Fed stress test scheduled to be released tomorrow, and a Russell reconstruction event set up. Recall that the sloppy that could end in the month could be bright due to the still unknown impact of the mandatory monthly and quarterly pension fund rebalancing on Friday and next week. The market can then resume pricing at the depth and breadth of public distress that can be caused by the current recession (or close to the recession of your choice).

In the short to medium term, readers will see: Check this out, as the Nasdaq Composite recently experienced an almost continuous “island reversal” …

See Gap Up on May 27th and Gap Down on June 10th. The group of nine candles created what is called the Bearish Island Reversal. As you can see, it worked very well. Now, look at the gap on June 13th. It is the beginning of a sloppy-looking island that has been or was shaped like a bullish island reversal. I could (and still can) show the market where my paper at the end of June will work well. problem?

I do not understand. Of course, the island reversal can fly alone, as if it contained only one candle. It will be Tuesday (yesterday) …

Tuesday candles will create an island on the island if stock index futures, which fell sharply this morning, remain low. In this case, the bearish reversal is included in the potential bullish reversal. Volatility? Yeah, it’s not a joke. Hey, the short cover is over so far.

What happened?

Well, many things have been said and many things have changed since the rally on Tuesday. In fact, you may have noticed that sales started with about 45 minutes remaining in a regular session on Tuesday …

President Biden spoke from the Roosevelt Room in the West Wing of the White House on Tuesday afternoon.… “Planning a second pandemic requires more money. Another pandemic will occur. You need to think proactively.” Absolutely scary. Did you mention that the keyword reading algorithm fires in microseconds because milliseconds are too slow?

Ray Dalio, a billionaire hedge fund investor, wrote in a LinkedIn post:… he believes it is “a naive and contradiction in how economic machines work” (if the central bank can curb inflation, things will get better again). Dario later added, “The only way to raise the standard of living in the long run is to be more productive, and the central bank does not.” I don’t always agree with everything Dario says. He is right in this regard.

Richmond Fed Pres gave a lecture at a webinar hosted by the National Association for Business Economics.Tom Birkin said… “We are in a situation where inflation is high, the base is wide and sustainable, and interest rates are still well below normal. The spirit returns to where you want to go as soon as possible without you. I want to break something. “Well, don’t spit, Sherlock. Thank you, Captain of Vicious. Birkin will speak again later today.

On Tuesday, Bloomberg News ran a story written by Matthew Boyle, citing the recent erosion of labor market health. In the United States. Boyle recently “thinned” herds as the two largest private employers in the United States, both Amazon (AMZN) and Wal-Mart (WMT), began to rise on a four-week moving average for their first unemployed claims. Reminds me of the announcement. Boyle also states that job ads have recently slowed down in some industries, according to Indeed, the job market website.

Geopolitical tensions increased throughout the Baltic region.. In response to Lithuania’s announcement that it will block the transportation of sanctions to the Soviet Union, I mean the isolated Kaliningrad Oblast of Russia. Russia’s Security Council Secretary Nikolai Patrushev said Russia “will definitely respond to such hostile behavior, which will have a serious negative impact on the Lithuanian population.” Lithuania will have a serious negative impact on the EU and NATO. Both members. Separately, Estonia, a member of both the EU and NATO, in the same area, said Russia’s border security helicopter flew into Estonia’s airspace on June 18, while Russia attacked the country with a missile. I accused him of simulating.

Russia has announced that part of the Baltic Fleet will soon carry out a “massive” naval operation in the Gulf of Finland. This includes minelaying ships, live shooting, and anti-submarine training. NATO will hold a summit in Madrid next week.

So do we go by Metaverse?

Because some of you called it an omniverse.

On Tuesday, the formation of a new group was announced … Metaverse Standard Forum. It is expected to establish a standard that will be widely used by almost or all participants. Tomorrow’s Internet (or a little further away) will be augmented reality and / or virtual reality, the Internet economy, next-level games, and an immersive 3D virtual world of interacting avatars. Man, I’m glad I grew up when you had to look at people’s eyes, make quick assessments, and shake hands.

Founding members of the new group include Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA), Unity Software (U), Adobe (ADBE), Alibaba (BABA), Autodesk (ADSK), Qualcomm (QCOM), Includes Sony. (SONY), and Wayfair (W). A very notable exception from the group was Roblox (RBLX). The forum will be held for the first time in July.

“Red” Delicious

UBS analyst David Vogt pointed out that Apple’s (AAPL) iPhone shipments outperformed significantly in China in May, gaining market share. Like we all didn’t see it coming. Vogt, rated four stars on TipRanks, has a “buy” valuation of its stock at a target price of $ 185.

Economy (All Times Eastern)

07: 00-MBA Mortgage Application (Weekly): Last + 6.6%.

08:55-Red Book (Weekly): Past 11.4% y / y.

13: 00-20 Year Bond Auction: $ 14 billion.

16: 30-API Oil Inventory (Weekly): The last + 736K.

Federal Reserve Board (All Times Eastern)

09: 30-Speaker: Jerome Powell, Chairman of the Federal Reserve Board.

12: 50-Speaker: Chicago Fed Charles Evans.

13: 30-Speaker: Philadelphia Federal Reserve Board Patrick Harker.

13: 30-Speaker: Richmond Federal Reserve Tom Birkin.

Today’s earnings highlights (Expectations for consensus EPS)

Before opening: (KFY) (1.55)

After closing: (FUL) (1.07), (KBH) (2.03), (WOR) (.83)

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