S&P500 Volatility > Bitcoin Volatility: Big Tech=Big Disappointment
Layoffs, Missed Earnings & Increased Interest Rates... What's Next?
Dear Sunday Investors:
Happy Sunday & welcome back to this week’s edition of the Sunday Investor! To all members, we will be going into a recap for the markets of the last few months starting with the top 5-10 news articles, TLDR of the current markets overall. We will then go into the top Twitter threads followed by more on upcoming events in the markets, and we what we can expect for the near future, while lastly ending with our memes of the month and the conclusion!
As always, read, enjoy and share The Sunday Investor with any friends below
Articles To Take A Look At
The U.S. Dollar Index, which measures the greenback against a basket of other currencies, continues to surge as it is now up more than 17% so far this year. - Forbes.
U.S. GDP accelerated at 2.6% pace in Q3, better than expected as growth turns positive for the first time this year - CNBC.
Tech companies such as Microsoft, Alphabet, Meta, Apple and Amazon continue disappointment on their earnings calls causing investors to be uneasy on if the selloff is over - DarQube
Layoffs continue. Companies including Chime, Opendoor, Chargebee, Stripe, and Twitter headline tech’s most recent layoffs - TechCrunch.
Bitcoin has been more stable than the S&P500 & the Nasdaq for the first time in history over the last month. The last time volatility was this low, Bitcoin rose from $9k to $60,000 in less than a year - Coin Telegraph.
Binance vs FTX Drama begins as CZ, CEO of Binance tweets he is going to sell $2B of FTT, FTX’s native token due to liquidity concerns with financials coming out in the last week- Financial Times.
The Polygon MATIC token price is surging due to a sequence of high profile partnerships with Meta, JPMorgan and Reddit involving NFT development. - BeinCrypto
Recent Markets TLDR
US GDP surprises with a rise for the first time of 2022
US Dollar continues to rise as stocks plunge
Interest rate hikes continue at 75bps raising mortgage rates to over 7%
Layoffs continue at major tech companies
Bitcoin is less volatile than the SP500 and the Nasdaq
Crypto progress and partnerships quietly continue with Meta, JP Morgan & Reddit
Tech stocks continue to disappoint this year with uneasy earnings in November
Major crypto exchanges FTX and Binance face off for the first time
Top Recent Twitter Threads
Chart of the Year So Far
What’s Next For The Markets Heading Into EOY?
EOY Rise In Markets:
Since 1945, the S&P 500 rose in 60% of the Octobers, 66% of the Novembers and a whopping 77% of the Decembers, CFRA found.
November & December are historically two of the best months for markets, and we will see if these trends continue this year will all of the uncertainty we have seen so far.
Midterms:
During mid-term years since 1945, the S&P 500 has averaged a monthly price gain of 2.5% in October, 2.4% in November and 1.4% in December, according to CFRA Research.
With Midterms on November 8th, markets again historically increase for the next two months.. will history repeat this year?
CPI Inflation Numbers:
Unfortunately, estimated inflation data for the month of October is not encouraging. Currently the Cleveland Fed’s nowcast has October CPI inflation running at +0.76% month-on-month, according to Forbes.
Inflation data is expected to be released this week on 11/10. Expected inflation numbers are expected to be 8.0%. If we hit above with number with all of the rate hikes, look for a volatile end of the week
China:
The briefing of China vowing to continue with their 'dynamic-clearing' COVID strategy follows a week in which markets surged on hope China would relax restrictions, buoyed further on Friday when a former disease control official told a banking conference that China would make "substantial" changes to COVID policy in the coming months.
China’s economy is the second largest in the world. Recent news last week of all Covid restrictions being lifted rallied Chinese markets. If this news is confirmed over the coming weeks, look for Chinese stocks to continue rallying hard towards EOY.
Crypto:
Over the last five years, Bitcoin has gained an average of around 25% in October — the biggest rise for any month — plus 8% in November and 11% in December, according to data from Bespoke.
Bitcoin has just had one of the least volatile past few months of its history, being less volatile than both the S&P500 & the Nasdaq major US indexes. Look for Bitcoin to pump or dump with the news of inflation numbers coming out this week.
With all of the uncertainty, it is important to do your own research and stay safe with all of the volatility we have seen so far this year.
Alpha Of The Month
According to Quiver Quantitative, a Democratic senator who publicly claims the economy is "moving in the right direction" placed a bet against the U.S. economy last month, according to Senate financial disclosures.
Senator Tom Carper, disclosed this week a purchase of up to $110,000 in shares of Ranger Equity Bear ETF, a fund that shorts stocks on the expectation that the market will decline. Check out Quiver Quantitative for more information like this. Although trade data is delayed, you are able to see past historical returns and total trade history by everyone in power in the government through this website for free!
Memes Of The Month
Next Article
My next article is planned to be an EOY review of the markets and a 2023 markets preview/prediction piece. As always, send in any questions directly to me or comment below on this post what you’d like me to cover in the next post and happy to do so as well!
Not financial or tax advice. The content in this newsletter is for informational purposes only. Every investment and trading move involves risk. Do your own research when making decisions.