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MAY 29, 2020
STOCKS – NONE
MACRO – SPY,
MIKE’S READING THE MARKET PREMIUM CONTENT $35/MONTH OR $300/YR–
- Dealers Still Supporting The Market
- A Busy Next Week Starts Today
- Thinking About Where Stocks Go Next
- Nearing A Major Turning Point -Midday
- Options Bet Indicate Apple May Drop Soon
It has become rather clear to me this week, that the large volatility swings we have witnessed are merely driven by broker-dealers hedging their books against their open options positions. It obvious, they need to get long futures around the 3,000 level in the S&P 500 and short futures around the 3,050 level. It is that easy. This is a topic that we have discussed every day in my subscription area for weeks now, and it was much more apparent this week than in weeks past, which is why I’m bringing it up here. All one needs to do is look at the open interest levels in the S&P 500 to see. Premium content – Dealers Still Supporting The Market
It is not a coincidence that all week the S&P 500 could not close above 3,050, despite several late-day attempts, and came roaring back when the SPX got to or below 3,000. It is just that simple; there is nothing more too.
Again, if you are wondering why I have never discussed this before, well, because it is a difficult topic to grasp, and it is more complex then the way it is described above. Many of the members took a few weeks to get caught up to speed, but for the most part, they all get it now.
For now, this all continues to be just a part of the large broader momentum trade that has been taking place in the markets.
That is all for a Friday.
-Mike
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.