Blow Off Top Or Something Else?, AirPod Hearing Aids, Crypto Winter Is Coming, Mortgage Rates, Much More
This is what we expected, no? We said the Fed would cut and it didn't matter much to us if it the cut were 25 bps or 50bps. So far the playbook for the Fed that we've outlined repeatedly for the last few weeks is playing out.
Here's the transcript from this week's Live Q&A Chat.
Q. Hey Cody. Does the 1/2 point rate cut change your blow off top scenario? Does it change your caution level moving forward?
A. This is what we expected, no? We said the Fed would cut and it didn't matter much to us if it the cut were 25 bps or 50bps. So far the playbook for the Fed that we've outlined repeatedly for the last few weeks – that the markets might just blow-off top when the Fed finally cuts this week and that it might take a day or three to play out, but that we should be prepared for it and then as the blow-off top potential takes hold, maybe get a bit more cautious and raise some cash and/or buy some puts and put on more short hedges. That's what we've done today. We trimmed down most of our longs about 5% or a bit more and we nibbled a few puts on some indices like Vanguard Russell 2000 Index Fund ETF (VTWO) and Invesco Semiconductors ETF (PSI) and iShares Semiconductor ETF (SOXX) as planned. Easy does it as usual.
