Physik Invest’s Daily Brief is read free by thousands of subscribers. Join this community to learn about the fundamental and technical drivers of markets.
Administrative
A brief letter today. In the next sessions, this letter will publish an exclusive first look at comments from this letter writer’s recent chat with Simplify Asset Management’s Michael Green for a Benzinga article.
Moreover, in a summary of last week’s comments, the economy is on a solid footing and this provides the context for a longer-lasting and, potentially, more aggressive tightening cycle. Notwithstanding, “stocks can ignore bonds for extended periods of time,” says Interactive Brokers’ (NASDAQ: IBKR) Steve Sosnick who thinks investors have sufficiently de-risked and, consequently, “they may not feel compelled to sell more stocks or clamor for protection.”
With less risk, traders may not need as much protection as well, hence low(er) implied volatility (IVOL) via measures including the Cboe Volatility Index (INDEX: VIX). Sosnick adds that “the ‘pain trade’ might be to the upside; institutional investors are highly susceptible to FOMO, especially if they are underweight.”
Interested in how to participate in this volatile market? In the Daily Brief for March 3, we talked about big macro and positioning themes such as 0 DTE, as well as how to cut your downside and have more efficient exposure to the upside. Have a great day!
Technical
As of 7:30 AM ET, Monday’s regular session (9:30 AM – 4:00 PM ET), in the S&P 500, is likely to open in the mid-to-lower part of a balanced overnight inventory, inside of the prior day’s range, suggesting a limited potential for immediate directional opportunity.
The S&P 500 pivot for today is $4,052.25.
Key levels to the upside include $4,059.25, $4,071.75, and $4,082.75.
Key levels to the downside include $4,045.25, $4,032.75, and $4,024.75.
Disclaimer: Click here to load the updated key levels via the web-based TradingView platform. New links are produced daily. Quoted levels likely hold barring an exogenous development.
Definitions
Volume Areas: Markets will build on areas of high-volume (HVNodes). Should the market trend for a period of time, this will be identified by a low-volume area (LVNodes). The LVNodes denote directional conviction and ought to offer support on any test.
If participants auction and find acceptance in an area of a prior LVNode, then future discovery ought to be volatile and quick as participants look to the nearest HVNodes for more favorable entry or exit.
About
The author, Renato Leonard Capelj, spends the bulk of his time at Physik Invest, an entity through which he invests and publishes free daily analyses to thousands of subscribers. The analyses offer him and his subscribers a way to stay on the right side of the market.
Separately, Capelj is an accredited journalist with past works including interviews with investor Kevin O’Leary, ARK Invest’s Catherine Wood, FTX’s Sam Bankman-Fried, North Dakota Governor Doug Burgum, Lithuania’s Minister of Economy and Innovation Aušrinė Armonaitė, former Cisco chairman and CEO John Chambers, and persons at the Clinton Global Initiative.
Connect
Direct queries to renato@physikinvest.com. Find Physik Invest on Twitter, LinkedIn, Facebook, and Instagram. Find Capelj on Twitter, LinkedIn, and Instagram. Only follow the verified profiles.
Calendar
You may view this letter’s content calendar at this link.
Disclaimer
Do not construe this newsletter as advice. All content is for informational purposes. Capelj and Physik Invest manage their own capital and will not solicit others for it.
