Yo Pit Crazies,

SPX has made many trips in 2022 in a run to 4,000 on a hope and a prayer.

Hope is a four-letter word in trading. For instance, many hoped the Fed would stop raising rates and inflation would slow down enough.

That led to many other four-letter words, as neither has happened.

We end the year with more rate hikes on tap and inflation running well over 7% after six months of record rate raising.  

Is Congress helping? Nope! Not with another record spending bill after a year of record spending bills.

Vol Man rides one-year SPX with low tops and lower lows.

SPX has not been able to hold 4000 since the omnibus spending bill was passed. The right hand of the Congress is not talking to the left hand of the Fed.

So how long will it take to reach 4,000?

Stocks Need to See A Change

Most of the rallies in 2022 were a redux of 2021. By that I mean, folks were hoping the Fed would be super accommodative again and the party would get back to rolling along.

Powell has been clear in the last six meetings that won’t happen. What Vol Man sees in the chart above is shrinking peaks and troughs which should mean somewhat lower volatility for 2023 overall.

I am thinking the average VIX settlement drops two points or so for 2023. The trips to 4,000 will be more rare …

Unless something changes.

That is perfect for my SPYMaster strategy.

Thirteen of my last 13 open trades are wins there. I am not hoping for 4000, but trading what the market gives me.

And through Friday you can get access for 50% off.

To Your Trading Success,

AG