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Wednesday, February 1, 2023

Happy - The Fed Day - Wed. Feb. 1st. Money-flow, #TheFed, Gold, Bonds, 401k, Meme Stocks, Crypo, and finally Natural Gas

I had a hard time writing this mornings blog for no other reason, than I had to update several charts, I hadn't looked at for a while. I started looking for a certain chart I like to use, that tells me if money-flow is tightening up, and I got distracted with everything from Bitcoin, to Gold.... After finally reviewing the chart I was looking for; I can tell you this; money is not tight, but there is a good chance that we're about to see the return of the bond vigilantes, and you should know what that means for equities. 

I've already moved the Wife's 401k, out of bonds, and tech stocks, and parked it in a safer place, for the next few months. 

Looking for a safe place to park your 401k? I'm not a financial advisor, but I did sleep at a Holiday Inn Express last night, and I believe there's a lot of pent up demand for Healthcare services, after what people have had to put up with - from the healthcare industry - over the past 3 years....! Never forget...! 

$XLV (Health Care Select Sector SPDR - adding this chart to the Public Charts Area 

Not biotech! Good ol' fashion Health Care. 

January wrap-up 

 In case you didn't notice, the market rallied straight though Jan. just as I predicted it would, for obvious reasons. A good January paves the way for a good rest of the year, and that's the story you have to sell to retail investors, if you want to keep the money flowing. 

Speaking of Money-flow

The Fed, and the ECB, have done very little to remove liquidity from the system, and the news coming out of Spain, should be a canary in the coal mine.  


Excess liquidity continues to find it's way into the Crypto-currency space, and Meme stocks. 

Jim Cramer is the best contrarian indicator, isn't he?! 

Remember when he told investors to stay away from the crypto space, and highly speculative stocks? 

As I always say, be careful who you trust!  

A good example of a highly speculative name, that has been running like the wind, is $ADMA 

$ADMA (Bioligics) - by the looks of it; if I didn't know better, I would've thought this was a gold miner!

Helps explain why the small-caps are leading the rally, right? 

Natural Gas

It seems to be on sale, but it's not exactly off to the races, quite yet.

I think the powers that be, will continue to sell NatGas into March contract expiration, which is still a ways away, and maybe even through the summer, knowing how things go. 

I'll continue to look for a bottoming pattern, but as long as I continue to see retail investors bottom picking Natural Gas, I'm going to steer clear of that trade, and I'm proud of myself for selling NatGas, on yesterday's dead cat bounce!  

Today's FMOC announcement probably isn't going to matter as much, as tomorrow's EBC... and regardless of what they decide, the market has already priced in lower inflation.  

Eurozone Inflation Eases for Third Month as ECB Rate Rises Bite wsj

Take Care, AA 

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