Onto Q2…With A Caveat
Mar28

Onto Q2…With A Caveat

As we close out a stellar Q1 at Zenolytics, I want to highlight one element of trading during this quarter that deserves everyone's attention as we head into Q2. For reference, this was a tweet from early in the quarter, on January 19th:         Turns out this resistance area on the NDX was indeed the spot, as once it was touched, the character of the market shifted entirely. Here is the NDX chart after today with the same trajectory sitting in red.   Not coincidentally, the red trajectory marked the ceiling for this rally for entirety of the second half of Q1. Certainly within the realm of possible outcomes for a rally that very few saw coming in the first place. So what now?   Q2 gets exponentially trickier. What we have seen during the past few weeks is but a preview of what to expect during the months to come. Price action will be much more choppy. Leaders will rotate dramatically. Investors who fail to be agile with their trading will be run over completely. What the pause at the key red trajectory signifies is a market that is preparing to go to war with investors. That war will involve numerous whipsaws prior to the market finally deciding on a direction from here. A high probability exists that the direction will be up. Prior to that taking place, however, there will be numerous whipsaws and misdirection plays that can be taken advantage of through the right allocation decisions at the right time. The easy part of this rally is behind us. Spring trading has always been a difficult proposition for investors, giving birth to sayings like "sell in May and go away." While we have no plans of going away at any point soon in this magnificent bull run, it would be wise to guard your gains during the weeks and months ahead. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business...

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When We Last Left Off…..
Mar24

When We Last Left Off…..

When we last left off, the market was in the process of manipulating investors into a series of incorrect, neutral/bearish positions prior to the FOMC decision this past Wednesday. This weekend's edition of Zenolytics Turning Points goes over in detail what is possibly one of the better setups of the year, with multiple key indices and mega-cap tech names all lining up for a powerful move in the coming weeks. In addition to this, the psychology of this uptrend continues to be warped, at best. Put as simply as possible, a vast majority of investors missed out on what was one of the greatest layups in buying risk assets, whether equities or crypto, during Q4 of last year. They completely whiffed on getting allocated during early to mid Q1. And now they find themselves sitting on a street corner bucket debating their future as largely irrelevant members of a capitalist society that continues to frown on group think, as it always has. We are at the very early stages in a resumption of a secular equity bull market that started in early 2010s. Go back and read my posts from 2011 talking about one of the greatest bull markets ever - a supercycle as I coined it then - taking shape when everyone was still jaded from 2008-2009. This trend to the upside will continue until the early 2030s according to the secular bull market cycle. In fact, history tells us that the most profitable portion of a secular bull market is during the latter stages, which will take place from 2025 onward. Tune out 99% of what you think is true about the markets and the economy in early 2024. The bullish case couldn't be clearer, despite the wall or worry that continues to haunt investors well past a point that is reasonable. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business in jurisdictions where licensed, registered, or where an applicable registration exemption or exclusion...

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Market Manipulation At Its Finest
Mar18

Market Manipulation At Its Finest

Last week was one thing. We knew it was going to be bearish, acting accordingly by bringing down our equity exposure to levels not seen since Q3 of last year.  In fact, we put on a small index short position that was covered this morning for a minuscule profit. However, now with the Fed meeting a short time away, the market is doing its utmost to manipulate investors into a position of confusion, disallowing any firm commitment in either direction. What became clear with the market action to close out last week was that the bears failed to capitalize on a number of catalysts, both technical and fundamental, that should have allowed them to string together much more significant losses than the near flat performance in the SPX. The giveaway that the market is in manipulation mode came with the big gap this morning that served as bait for bears, who love to short large gaps on thin volume. Now we are getting what is seemingly a confirmation in the overnight session, with risk assets declining, led by crypto. Yet another attempt at baiting bears and tepid longs into making sub-optimal decisions into the FOMC. Expect this trend of manipulation at its finest to continue through Wednesday. I expect that by Thursday the market will reveal its hand, demonstrating a firm commitment towards further upside, with a high probability of NDX 18400 being taken out to close the week. If you are trading in the markets and you don't know who the sucker is, then you are the sucker. Fortunately, we have spotted the suckers. Behave accordingly. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business in jurisdictions where licensed, registered, or where an applicable registration exemption or exclusion exists. Information contained herein is not intended for persons in any jurisdiction where such distribution or use would be contrary to the laws or regulations of that jurisdiction, or which would subject T11 Capital Management LLC to any...

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The Next Leg
Mar13

The Next Leg

As we are now roughly four months into this rally, a recognition needs to take place of a leveling up in the difficulty of extracting gains from this market. November - March was relatively easy. The opportunities have been boundless, from NVDA to crypto, in this relatively narrow bull market, it simply took a recognition that momentum was working and every other piece of analysis offered up offers little value, whether macro related, fundamental valuation analysis or otherwise. Save your moral hazard based, overly intellectualized bearish arguments for college economics class, as the only thing that matters in the markets is capturing gains while they are available. With that said, it is important to understand that with the easy money more than likely behind us, there will be numerous curve balls to come during Q2, as we quickly approach April. It begins with the Fed next week, with what is likely to be a continued resurgence in inflation as PPI will show tomorrow, and as a result Powell getting caught between a rock and a hard place, having to walk back, ever so slightly, his recent dovish stance. The market is not prepared for even the slightest hawkish results out of the Fed next week. There are no hedges. The bears have largely been forced to capitulate. In other words, there is a lot of hollow ground beneath the market should things begin to turn sour. Ultimately, any weakness will more than likely be a buying opportunity for those with dry powder. Our current allocation here at Zenolytics allows us the luxury to take advantage of what is likely a difficult period ahead, while nearly everyone is expecting smooth sailing a la November - March. The game is going to change in Q2. We are about to get an early preview of the changes to come during the second half of March. Strap in. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business in jurisdictions where...

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Where And What To Look For In The Days And Weeks Ahead
Mar10

Where And What To Look For In The Days And Weeks Ahead

A little over an hour ago I delivered to clients this weekend's edition of Turning Points.  In it we have 16 pages of technical data reviewing the importance of what occurred this past week, not just in the Nasdaq, but also key individual names and ETFs. There are times in a market trend where everything comes together in an undeniable and overwhelming fashion. This past week was a text book example of such an occurrence. As a result, we have taken down net exposure to levels not seen since Q3 of last year. At the same time, an interesting divergence is taking place in risk assets as crypto continues to garner investor attention, with increasing focus on alternative crypto names. The overall trend remains in its infant stages, as Bitcoin is just beginning to flirt with new all-time highs, while other key tokens are still some ways away from new highs. Most alt names have yet to make a move at all. Over the next 12-18 months, an inordinate amount of investor attention will be driven towards crypto due to the expansion in market caps taking place, further solidifying crypto as a major asset class with opportunities far beyond just Bitcoin. This bullish view on crypto isn't something new around here either. In fact, I have been discussing this since October of last year, when we were buying MSTR in the 300 range and subsequently, ETHE in the mid-teens. While we continue to trade in Bitcoin and ETH related names, the greatest gains for investors will come from discovering well placed alternative crypto names that have potential in excess of 10x. You cannot trade around the volatility in these names, which is why we choose to take positions and simply sit on them for the duration of the cycle. In the case of both equities and crypto, the focus of investors should remain on finding opportunities to increase bullish exposure. We have plenty of firepower to increase exposure to equities in the days and weeks ahead. Certainly looking forward to what are sure to be many new opportunities presented throughout whatever volatility the market decides to give us in the time to come.   Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer...

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Weekly Note Preview: The Importance Of The Technical Events That Took Place This Past Week; The Push/Pull Effect In Major Indices; The Role Of Small-Caps Moving Forward; Analysis Of 4 New Positions Being Initiated This Week
Mar03

Weekly Note Preview: The Importance Of The Technical Events That Took Place This Past Week; The Push/Pull Effect In Major Indices; The Role Of Small-Caps Moving Forward; Analysis Of 4 New Positions Being Initiated This Week

In this weekend's 420th edition of Turning Points we have a 16 page note discussing the importance of the technical events that took place this past week; The push/pull effect in major indices; The role of small-caps moving forward; Analysis of 4 new positions being initiated this week. What follow is a brief preview from this weekend's note: The NDX 18000 level has been a focal point of my analysis since mid-January as both a point of attraction for the markets and a potential resistance point that would dictate our next set of steps based on the reaction. In fact, the NDX 18000 level is only superseded in importance by the infamous key red trajectory on the SPX that plagued the market for nearly two years, resulting in breakdowns, excessive volatility and all types of market shenanigans that are thankfully behind us. The manner in which the NDX took out its key red trajectory on Friday is on par with the December 12th breakout in the SPX over its key red trajectory. Let's first look at the SPX from the December period in order to gain perspective of what can result following such an important technical event. To view the entirety of this weekend's note, you can subscribe by clicking here. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business in jurisdictions where licensed, registered, or where an applicable registration exemption or exclusion exists. Information contained herein is not intended for persons in any jurisdiction where such distribution or use would be contrary to the laws or regulations of that jurisdiction, or which would subject T11 Capital Management LLC to any unintended registration requirements. Visitors to this site should not construe any discussion or information contained herein as personalized advice from T11 Capital Management LLC. Visitors should discuss the personal applicability of the specific products, services, strategies, or issues posted herein with a professional advisor of his or her choosing. Information throughout this site, whether stock...

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Weekly Note Preview: The Confluence Of Factors Playing Into The Long-Term Secular Bull Cycle; The Best Sector To Take Advantage Of What Lies Ahead; What We Plan On Doing With Our NVDA Long Position; A New Position Being Initiated
Feb25

Weekly Note Preview: The Confluence Of Factors Playing Into The Long-Term Secular Bull Cycle; The Best Sector To Take Advantage Of What Lies Ahead; What We Plan On Doing With Our NVDA Long Position; A New Position Being Initiated

In this weekend's 418th edition of Turning Points we have a 15 page note reviewing long-term expectations for the markets; The best sectors to take advantage of what lies ahead; A review of crypto, including the current state of alternative crypto investments; What we plan on doing with our NVDA long position; What to expect from the markets during the weeks ahead; A review of a new position being initiated on Monday. What follow is a brief preview from this weekend's note: We are in an unusual space in time given the convergence of a number of unprecedented technological, economic and geopolitical developments taking place simultaneously. This naturally creates the tendency towards caution as there are few corollaries to what 2024 and onward is in the process of becoming. The predominant sense of caution is further amplified by where it is we have come from the past several years. Whether the extreme volatility of the 2020 pandemic market or the recent 2022-2023 secular bull market consolidation that saw mega-cap tech stalwarts like META lose 80% of their value from peak to trough, investors have been conditioned to expect the worst and hope for the best. Let's consider for a moment where we are in time: - Geopolitical power structures shifting - USD reserve currency dominance being challenged - Inflationary pressures unpredictable - AI creating growth that is exceeding that of the dot com boom - AI creating economic, social and political ramifications that are both unpredictable and unprecedented - Crypto being an unregulated, highly speculative financial sector seemingly waiting in the wings for AI integration, while demonstrating continued resilience against regulatory authorities - Developed nation balance sheets being leveraged to the hilt, with massive amounts of liquidity remaining in the global economy - A two year consolidation in the US markets in 2022-2023 that created extreme volatility in key assets, further dissuading investor participation - A secular bull market that, as I have demonstrated in the recent past, is squarely mid-cycle in terms of overall age A literal powder keg of technological, economic, social, political and technical convergences. Bringing us to what is the most important chart in finance. This is a chart I have been sharing for nearly a decade now, as it continues to track expectations perfectly. To view the entirety of this weekend's note, you can subscribe by clicking here. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and...

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The Market Balancing Act In Progress
Feb22

The Market Balancing Act In Progress

NVDA's earnings report created the necessity for a market balancing act to take place over the next several days. That balancing act has everything to do with the fact that AI might just be in the middle of its 1st inning of growth, with Wall Street slowly but surely catching onto this fact, while the markets continue to struggle against some hefty overhead resistance in the NDX. Additionally, the specter of higher rates lurking in the background is creating an environment that is rife for excess volatility. The issue is that when coming against monster resistance at 18100-18200 on the NDX, the last thing you want to see is excess volatility. NVDA, interest rates and the inevitability of instability created as a result of focusing on economic data during the weeks ahead only exacerbates this. There is going to be a lot of excitement during the days ahead as the markets will likely continue to march forward. However, there remains a case to be made for watching your risk now more than any other time thus far this year. Let's see how the markets deals with key resistance during the days ahead. This will tell us everything we need to know about the adjustments to make during the coming weeks. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business in jurisdictions where licensed, registered, or where an applicable registration exemption or exclusion exists. Information contained herein is not intended for persons in any jurisdiction where such distribution or use would be contrary to the laws or regulations of that jurisdiction, or which would subject T11 Capital Management LLC to any unintended registration requirements. Visitors to this site should not construe any discussion or information contained herein as personalized advice from T11 Capital Management LLC. Visitors should discuss the personal applicability of the specific products, services, strategies, or issues posted herein with a professional advisor of his or her choosing. Information throughout this site, whether stock quotes,...

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Today Was By No Means A Fluke
Feb13

Today Was By No Means A Fluke

For two months how I have been feverishly bullish on stocks, discussing new all-time highs by the middle of January in early December when very few thought such a move was possible. When in mid-January we hit the 4850-4900 target I had outlined in the months prior, immediately my focus shifted to the NDX 18000 level as the next test for the market. Then yesterday prior to today's CPI release, I said very specifically do not take Monday's reversal at 18000 lightly. That reversal was a very early recognition move by the market that was spot on at a very precise target. The very first signs of smoke where there is now a fire. Here is the tweet from Monday: Now as we sit with a significant reversal taking place at a resistance area that has been treacherous for the markets going back more than 14 years, I want to again emphasize that investors should not be dismissive of the bearish signals that are suddenly beginning to pile up. While I expect the markets to be much higher by the middle of this year, from now into the end of Q1 has the potential to be a treacherous affair. We all came into this year expecting rate cuts. We all came into this year expecting to put the Fed on the back burner by spring, instead focusing on good earnings, a relatively healthy economy and several technology themes driving momentum.   Instead, after today, we are again mired in the Fed watch doldrums. We have to mince what Powell says. We have to pay attention to Fed governor speeches. We have to wait for critical economic data before the market is given permission to choose a side. Earnings are behind us and now this is what lies ahead until what is more than likely the late March Fed meeting. Until then cash levels should be high. This is a bull market so risk should not be shunned completely, but it needs to be managed. We sold all of our growth names on Monday, with the exception of a single small-cap name. Currently sitting on our largest cash position in months. Content to wait this out, knowing that a buying opportunity will come, allowing for some outstanding gains if one chooses to be patient. Let's see how this all shakes out before recommitting.   Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and...

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Tomorrow’s CPI Is Not So Cut And Dry
Feb12

Tomorrow’s CPI Is Not So Cut And Dry

Tomorrow's CPI is not so cut and dry. This isn't so much a contrarian view as it is a study of the dynamics taking place in the markets prior to the CPI release. Most obvious of which is the fact that bonds have developed the penchant for persistent weakness irrespective of economic data. All this is taking place, by the way, as numerous inflation gauges tell us that inflation is, at least temporarily, a relic of years past. Even in the days leading up to the CPI release, when you would expect bond shorts to cover some of their exposure ahead of the data tomorrow morning, not a peep. They are simply sitting tight with yields steadily moving up over the past several trading days into the report. It is strange, to say the least. It is easy to be dismissive of this signal, expecting that "bond investors will get it, don't worry." When taking into account that we are witnessing this type of rate divergence, paired with the NDX hitting a key resistance level at 18000 that I have been discussing for weeks now, promptly reversing today's gain right off of resistance, then you should expect market shenanigans are around the corner. We have taken preventive measures so as to be much less exposed to any shenanigans moving forward. The second half of February deserves some caution. Zenolytics Turning Points is 400+ editions in and only getting better. Find out why institutions and individual investors have come to depend on our service through each and every type of market environment.  Click here for details. Disclaimer This website is for informational purposes only and does not constitute a complete description of our investment advisory services. No information contained on this website constitutes investment advice. This website should not be considered a solicitation, offer or recommendation for the purchase or sale of any securities or other financial products and services discussed herein. Viewers of this website will not be considered clients of T11 Capital Management LLC just by virtue of access to this website. T11 Capital Management LLC only conducts business in jurisdictions where licensed, registered, or where an applicable registration exemption or exclusion exists. Information contained herein is not intended for persons in any jurisdiction where such distribution or use would be contrary to the laws or regulations of that jurisdiction, or which would subject T11 Capital Management LLC to any unintended registration requirements. Visitors to this site should not construe any discussion or information contained herein as personalized advice from T11 Capital Management LLC. Visitors should discuss the personal applicability of the specific products, services, strategies, or issues...

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