Friday's trading session ended weak, which was no surprise, after the selling we saw all week. As usual the market was all about who was going to get paid on their weekly options.
The selling in the Nasdaq has actually lasted more than 2 weeks - 12 days to be exact - and over that same period we've seen the energy sector driven to new recent highs.
To highlight this fact here's a short term chart comparing the energy sector to the Nasdaq 100
To further highlight this fact take a look at how Apple $APPL was taken down below the 50 day moving average, while $XOM was bid up above the 200 day moving average.
$APPL - a simple takedown; the rug pulled - on Friday weekly Options Expiration - if you will...
I can tell you that even several of the CNBC fast money traders were in on this stunt, and I could tell that, because they don't have good poker faces.
$XOM - a forced breakout above the 200 day ma., however by the close it had given back most of the gains - painting a bearish shooting start candle.
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I'm not sure this signals a larger sector rotation out of big tech, into energy, or just another rigged weekly options expiration date. My thought is the latter, since tech and energy have actually been rallying in the same direction since the beginning of June.
High energy prices are a huge liability for the election stealers.
Biden and co. can't continue to celebrate low inflation as long as energy prices continue to climb.
I'm sure the powers that be can already hear Donald Trump bragging about how low energy prices were under his administration.
So, I actually think it's more likely that we're going to see profit taking in energy, as the broader market continues to be propped up.
Take Care,
AA
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