2022/05/01 (036) Column

There’s nothing nice – really truly nothing nice to talk
about us stock markets, my bulls – especially the NASDAQ 100.
That`s why we let our short trading capability in the NDX run this week
& focus uns on the price action in the USD Index after hitting a 19 year high.


There’s Nothing Nice To Talk About The US Stock Markets
– Especially About The NASDAQ Composite, My Bulls! And This Is Bearish…

The indicators show unequivocally clear what I have been writing since our short trading capability, at 14,500 points (as of 02/16/2022). Even if my critics have since dismissed it as overconfident and superficial. There is only a handful of companies left that keep the NASDAQ 100 up, including our APPL, MSFT & FB long trading capabilities. But that’s basically not enough to keep the entire technology index up. Which is why we continue to leave our short trading capability open in the market. And that’s until the majority of stocks start turning seriously again…

Wall Street Extends Losses
Dow Was Headed Down Nearly 1000 Points On Friday
While The Technology Index NASDAQ 100 Suffered A 4% Carnage

Wall Street sell-off intensified in the last hour of trading with the Dow closing down 940 points, the S&P 500 sinking 3.6%, and Nasdaq retreating 4.2% as investors digested disappointing results from Amazon and Apple. Amazon sunk more than 14% after reporting a surprise loss because of its investment in Rivian and issuing weak revenue guidance for Q2 2022. Also, Apple declined more than 3% after CFO Luca Maestri stated that supply chain constraints could impede fiscal third-quarter revenue. It has been a difficult month for the stocks with investors digesting the possibility of a 50bps interest rate hike in May from the Fed as the central bank seeks to tame runaway inflation, the war in Ukraine, and a resurgence of COVID in China. On the month, the Nasdaq sunk 13.3%, the most since October 2008; the S&P 500 declined more than 8.8%, the most since March 2020; and the Dow dropped 3.9%.

The Disastrous Bitcoin Bond Auction Deepens
The State-Organized Fiscal Debt Market Crisis In El Salvador

The government’s plan to sell $1 billion in Bitcoin-backed bonds is proving to be a house of cards. The country’s fiscal policy may have stalled as El Salvador’s government faces an $800 million bond issue that matures in January 2023. For almost five months now, El Salvador President Nayib Bukele has been trying to sell a Bitcoin-backed bond to international investors. And argues that it’s a better option than turning to multilateral lenders in Washington for more conventional funding. But that doesn’t seem to work, since hardly any financiers respond to his offer. Bukele, a staunch supporter of cryptocurrencies, and or probably an even bigger anti-US dollar politician, hasn’t received a single penny of the $1 billion he is aiming for, according to Bloomberg – what I do. The talks with the IMF were basically deadlocked, it said last Thursday.

For many, Bitcoin is the path to great wealth – but the legendary US economist Nouriel Roubini referred to the cryptocurrency as a “shitcoin” as early as October 2018. At that time he already formulated that the world is in the middle of the “crypto apocalypse”. It is this roller coaster ride that now makes Roubini so pessimistic. Around USD 5000 in October & around USD 40000 today. This bubble is unprecedented in the history of money. “Especially people with zero financial literacy — people who don’t know the difference between stocks and bonds — went into a manic crypto frenzy,” said the professor, who teaches at New York University. And I want to agree not only with regard to this, but above all, in his analysis and assessment.

The Week Ahead Will Not Be Less More Volatile In The Week Ahead – After NASDAQ 100 Hits 12-Month Low

USNDX decreased to a 12-month low of 12936. So there is no reason to realize our short trading capability ahead and or around the regular meetings of the FED this week. It will be a busy week in the US with the Federal Reserve monetary policy meeting and jobs report taking a center stage. Also, attention will be given to corporate results, after dismal earnings from Amazon led to a sharp sell-off on Friday. Elsewhere, the Bank of England and Reserve Bank of Australia will be deciding on interest rates.

US DOLLAR Index Set For Strong Monthly Performance

The dollar index eased to around 103.1 on Friday after hitting a 19-year high in the previous session, but is still up about 5% in April and on track for its best monthly performance in nearly a decade. The greenback was lifted by bets on faster US interest rate hikes and worries about growth in Europe and China. The dollar climbed each week in April, and has particularly outperformed against the Japanese yen which sank to 20-year lows as the Bank of Japan reinforced a commitment to its super-low yield policy. Meanwhile, the Federal Reserve is expected to deliver a hefty 50 basis point rate hike at next week’s policy meeting in response to soaring inflation, to be followed by equivalent rate increases in the next two meetings. Weaker-than-expected quarterly US growth data on Thursday also proved little obstacle to the dollar’s rise, and investors hardly adjusted their nearterm interest rate bets. And that´s why I will be concentrate in our technical analysis this week mainly on the USD Index.