Stocks Rally on Day that Ends in “Y”

Andrew Giovinazzi

No bad news is good news

Yo Pit Crazies,

The S&P 500 moved more than 1% yesterday, although it did not close more than 1% over 4,130.

However, we rallied to a high we have not seen since JPMorgan Chase (Ticker: JPM) took over First Republic Bank for nothing two weeks ago.

The broader market has not done much since February – or August 2022 – the last time traders thought the Fed would stop raising interest rates. The central bank didn’t … and they are not going to cut anytime soon. Not while the big brains in Washington DC fail to understand they are part of the inflation problem.

I still maintain the rise in interest rates is to put the brakes on Congressional largess. Somehow, the prior blockbuster budget is a reason to spend more money the next year. Anyway, that is a reason why the SPX is not going anywhere. All the money is going into “AI” stocks and it won’t stop until traders are ready to jump on Main Street stocks again.

SPX 1 YEAR CHART

President Biden assigned staffers to negotiate the spending binge. The market liked the news. So when will the big unwind start?

Let’s find a clue when you click here.

The Dow Jones industrial Average ETF (Ticker: DIA) Is Down SinceDecember

It is hard to believe, but it is what it is.

There is no AI in the DIA, sadly – oh, but there is! Microsoft (Ticker: MSFT) and Apple (Ticker: AAPL) are in the DIA. It is not enough to keep the laggards like Minnesota Mining and Manufacturing Corp. (Ticker: MMM) and the rest of them from giving the DIA a liftoff. The market hates JPM right now even though they just picked up a bank for nothing.

That is the current issue, as the uncertainty keeps investors from snapping up bargains. The DIA is a big bargain. In Nitro Trader we bought some DIA calls and bought some tech puts. Wednesday was the first day in a while the DIA outperformed the Invesco QQQ Trust (Ticker: QQQ).

It has to start sometime!

The Rundown

NitroTrader

Apple (Ticker: AAPL), Alphabet(Ticker: GOOGL) Jul21 165/150/140 put butterfly, 110 calls closed for a 14% gain.

Big Money Flow

Evolus Inc (Ticker: EOLS) Jun16 10 calls closed for a 77% gain.

Win the Week

Bill is still killing it in the short-term trading world.

Market Vectors Junior Silver Miners (Ticker: SILJ) May19 10/11 & 11/12 call spreads closed

for a 17% gain.

Power Income Trader

SPDR S&P 500 Trust ETF (Ticker: SPY) 2/6/4 May 19 411/402/393 Put Butterfly closed for