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Wednesday, November 9, 2022

Market Update 11/9/22 - Market Lower On The Election Results

Today I plan to touch on the $VIX again, and the Crypto crash, but first allow me to rant on the stupid election coverage! 

This morning, I was watching - several different networks - coverage of the election results,  and it seems to me that Bloomberg is by far, the most incapable of writing an honest headline. They can't just report that the Republicans won back the house in a landslide, because they mustn't use the words, "republicans", and "win", in the same sentence, or they probably risk being fired. 

Between their nonstop politically bias coverage of everything, from the election, to climate, and even Elon Musk, the entire western media has become a joke.  

"Some races are still too close to call", but the idea that we can't even tabulate a vote at lightning speed, in 2022, should be the sad headline, and how do we even know that there is election integrity, when the power structure continues to call people "election deniers"? Who do you think is behind that message? See: 

How the National Security State Manipulates the News Media 


As an independent, I'm not celebrating this morning, because we didn't see a wholesale rejection of the entire power structure. I could give many examples of how the sheep went out and handed power back to the same people who have enslaved them, over the past several decades, and especially the past 2  and a half years, during the covid lock-downs. I imagine these must be the same idiots, racing to the next stoplight, with a mask on their face! 

As far as I'm concerned, nobody won, as the same people remain in power.  

What Does The Market Think About The Election Results?  

The market reaction is negative, because the market likes out of control spending, more than anything else, and even though there are few fiscal conservative left in congress, they will not be sending out any more free checks, at least not for a while.... 

Some folks claim that, "the market likes gridlock", but the market prefers open boarders, which fuel cheap labor, and everything else that's good for profits. This is in part why they had to run Donald Trump out of DC, so the 2 party system could get back to business as usual.      

So really, not much has changed, but we may see a little less spending on ridiculous nonsense, and that's going to help cool the run away inflation we've seen over the past couple years.  

Looking at the Technicals:

Yesterday, I stated that I believe that, "the powers that be", are using the low $VIX to load up on bearish Options bets, ahead of November Options expiration", and I still believe that, because I've seen this story play out a hundred times before. VIX sells off, or the market continues to rally, while the higher $VIX is ignored, and than all of a sudden, BOOM!  

Did you see the market reverse yesterday, on a dime, exactly where I said it would? 

In case you missed that, go back and see where I told you the $VIX was about to break out. 

Could I be wrong? Sure, we're only a few weeks away from the Thanksgiving holiday, and I believe we're already seeing short positions being covered, and that has helped fuel this rally, and that could continue for longer than you might think, but I think the bigger short covering rally isn't set to start until later this month, or even next....  

As I tweeted out just ahead of yesterday's close, I think there's a good chance that the $VIX remains contained, and after reviewing the charts again this morning, I'm even more convinced of that. 

Inexperienced, and impatient traders, always want to know when something is going to happen, but timing is far more difficult to predict than direction. 

The Crypto Crash 

While most traders are narrowly focused on tech, or Crypto, or some meme stock; I'm looking for a sector rotation, few are expecting. I wish I had seen the crypto crash coming, but I have no way to short that trade anyhow. I actually tried to pull the trigger on some crypto yesterday, but I figure there's plenty of time.... and this morning we're seeing it getting clobbered again. 

That may account for some of the weakness we were seeing yesterday, as contagion spreads to other markets, as margin calls hit the crypto space. 

Remember, not too long ago, when Cramer warned folks not to own crypto? 

Think he wasn't tipped off to this bloodbath ahead of time?  



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