This week in the market was practically a greatest hits compilation of what we’ve seen so far in 2021.
We had another “buy the dip” moment, the return of the Meme trade, all-time new highs, an epic rant from Davey Day Trader and the worst two day sell-off since October.
There was no lack of drama, and volatility certainly prevailed. Here’s a look at this week’s action in the DJIA using 30 minute intervals.
(Blue blocks = last half hour of each day… 0-for-5 in late day rallies cc@RampCapitalLLC)
After a slow Monday, we had a major “Buy the Dip” opportunity on Tuesday morning. Once again, investors did just that as the market shook off heavy selling and reversed course. What felt like an overdue and slightly panicked sell-off, was quickly scooped up and absorbed by the market.
The rally followed through nicely into Wednesday. This left me and many others that stayed on the sidelines perplexed. Did I really just miss yet another great buying opportunity?
Topping things off was this tweet from Chewy CEO and GameStop board member, Ryan Cohen, on Wednesday afternoon.
It looks harmless, right?
He likes frog emojis and pictures of McDonalds vanilla soft serve - who doesn’t? But let’s examine what happened in GameStop moments after the release of this tweet…
WOW.. was this some sort of Bat Signal to get back into the Meme trade? I severely doubt it, but the timing was peculiar. Good luck trying to justify the move with real news.
I guess one could say it occurred because of another possible short squeeze, news of the CFO leaving, or suspicious option trades. Sure, that sounds smart, so let’s go with those theories. It beats the theory that a frog emoji and an ice cream pic were an alarm bell to the masses to buy $GME with reckless abandon.
This also led to another epic rant by one of the markets more animated participants - Barstool’s Dave Portnoy…
As crazy as he can be, he did ask an interesting question. “Who hit the buy button and why didn’t I know?”
At the end of Wednesday, the Dow closed at a new all-time high. All was well in the world. That was, until Thursday.
A spike in treasury yields caused a major reversal in the market. The fear of higher interest rates and inflation deepened causing a sharp and dramatic decline. That decline continued through Friday as the indexes closed at their lows for the week.
Ironically, we experienced a sharp decline at the end of January as well. We’ve now ended both months of 2021 on steep pullbacks. Last month, both the Dow and the S&P 500 tested their 50 day moving averages and held. Once again, the indexes closed out the month sitting on that 50 day moving average.
The question heading into next week is, will they hold again and bounce or is this the time we finally get that sharper correction?
NBA Top Shots
On Friday, I got to experience all the hype. I was out of the house when the new release dropped. I called my son in a panic to have him join the queue. He had been telling me that this was so stupid for two weeks now, but I needed his help. Thankfully, he obliged.
So he logged on for his old man. We were one of 200,000 hopefuls trying to score one of 10,000 packs. My odds were roughly 6% to have the privilege to pay $99 for a pack of 6 moments. I texted some friends to see where they were in the line. No one was higher than 40,000. Then I got my kid on the phone and he told me were 6600th. All of a sudden, this was no longer “stupid” as we had a shot to buy a pack of moments.
By the time I got in the door, we were minutes away from being on the clock to make the big purchase. After three unsuccessful attempts clicking ‘purchase now’, it finally worked. We were the proud owners of the hottest ticket in town.
Some of these moments are going for thousands of dollars. Were we lucky enough to get one of them? Stay tuned… I plan on making a video of us opening them later this week. I’ll be sure to post the results.
Although, I will gladly sell the unopened pack for the right price. My DM’s are open.
Congrats Ramp Capital LLC
This week he hit the 100,000 tweet milestone!
There’s no better follow on Twitter when the markets get volatile. Here are just a few of this week’s highlights…