$SPY: updated short term view

2022년 11월 12일

We have a setup indicating immediate upside towards the area where a cluster of earning season related key levels align, and the mid point of the Ukraine invasion range sits, to be hit likely by late November.
The question is whether bonds have bottomed long term here, as that suggests the trend in the Dollar is reversing, which could have big implications for earnings in foreign currency and basically everything as it impacts sovereign entities with Dollar denominated debt, households squeezed by rising mortgage rates, etc.

Regarding equities, we could be at a juncture where we have an extended sideways bear market, which doesn't exclude powerful rallies lasting a few months, with substantial corrections as well, perhaps lasting until the next decade. As usual, we go step by step, but I've selected some long term positions I intend to hold on to, for as long as logical, depending on how fundamentals evolve, rebalancing when needed or rotating into other names with a larger opportunity vs risk, etc.

Trading wise, I suggest to set aside 25% of the capital for short term trading and dedicate 75% of funds for long term ideas. Risking 0.25% per trade in the trading account (1% of 25%) has been solid advice since I recommended this to my client base back in March. It was not the time to play Rambo in markets...But some big moves are brewing here. If interested in learning more, contact me.

Good luck!

Ivan Labrie.