SMART MONEY SELLS MOMO STOCKS ON CONCERN THAT FED MIGHT BE BOXED

Selling Momo Stocks

Please click here for a chart of Nasdaq 100 ETF (QQQ).

Note the following:

• Smart money is selling momo stocks on the prospect of the Fed being boxed.
• Smart money is buying economically sensitive stocks and value stocks.  Examples include AIG, C, FCX,  GT,  and X.
• The chart shows that the price of QQQ has not recovered since the drop on the jobs report even though DJIA is strong – up over 100 points as of this writing.
• In the Morning Capsule, we shared with you that the Fed might be boxed after the strong jobs report and Senator Manchin’s call.
• In our analysis, here is a simple scenario that may box the Fed:
  • August jobs report is as strong as the July jobs report.
  • Delta variant cases do not substantially accelerate among vaccinated people.
• If the foregoing scenario occurs, the Fed may be forced to announced a taper in September.  There is speculation that if the Delta variant comes under control, Powell may announce a taper at Jackson Hole this month.
• The VUD indicator is the most sensitive measure of net supply demand in real-time. The orange represents net supply and the green represents net demand.
• The VUD indicator is mostly orange in QQQ due to smart money selling.
• The VUD indicator in DJIA (not shown on the chart) is mostly green due to smart money buying.
• The momo crowd is oblivious.  They continue to buy momo stocks but have not been able to overcome smart money selling, at least so far today.
• Interest rates are rising due to the prospect of a taper.
• The dollar is getting stronger due to the prospect of the Fed being boxed.
• Gold is falling on the prospect that the Fed’s hand may be forced to adopt more sensible policies.

Money Flows

The momo crowd money flows since the Morning Capsule are 🔒 (To see the locked content, please take a 30 day free trial).

Smart money flows since the Morning Capsule are 🔒.

Short squeeze money flows are 🔒.

A Special Note To New Subscribers

Note the smart money behavior.  Smart money tends to sell into strength on strong up days.

New subscribers should consider adopting smart money’s  way of investing and trading.

Sentiment

Sentiment is 🔒.

Sentiment is a contrary indicator at extremes.  In plain English, this means that when sentiment becomes extremely positive it is time to sell and when sentiment becomes extremely negative it is time to buy.

Gold

The momo crowd money flows in gold are🔒 since the Morning Capsule.

Smart money flows are 🔒 in gold since the Morning Capsule.

Oil

The momo crowd money flows in oil are 🔒 since the Morning Capsule.

Smart money flows in oil are 🔒 since the Morning Capsule.

Buy Zones And Buy Now Ratings

🔒

Nibbling

🔒

Close

There appear to be buy on close orders.

There is merit to watching the pattern of market on close orders as they represent the day’s dominant net cumulative activity  by many professionals and funds.