The most important thing investors should have their eyes on right now is the TLT. The bond market has been choppy lately and the longer it goes sideways, the less pressure there will be on stocks because it has an inverse relationship with short-term interest rates.
This is a great sign that we’re bottoming out, or that we’re going to be in a choppier market and that the strongest downside pressure is behind us.
In fact, volatility via the VIX, or fear gauge, did not make a higher high this past week.
The put/call ratio is still above 1, which means more people buying puts than calls. But this also tells us that the market is stretched out because nobody is buying calls. And when the market starts to turn around, all of the puts will get covered.
It recently retired its woefully lacking browser, Internet Explorer… It’s navigating the acquisition of Activision Blizzard, agreeing to respect the rights of employees who are part of the Game Workers Alliance union… and perhaps most importantly, it’s just acquired cybersecurity firm Miburo.
Miburo specializes in detecting and responding to foreign information operations. And Microsoft’s acquisition of the company promises to boost its own cybersecurity research and capabilities.
Microsoft is planning on using Miburo’s tech to partner with other private and public companies to find ways to stop foreign adversaries from threatening customers.
And it seems the bulls see this move as a huge boon for Microsoft’s future…
That’s also not the only outsized institutional order flow we’re seeing…
Short-term Pullbacks provide opportunities to enter trades in the direction of the longer-term trend. Trade set-ups like these occur against short-term momentum (the pullback) but are in alignment with the longer-term trend and typically offer high probability and low risk trade ideas with a 2:1 (or better) reward-to-risk ratio.
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