Money Monday

Important dates that could effect the markets this week:

1. The November FOMC Meeting is next Wednesday, November 2
2. Midterm Elections are Tuesday, November 8

S&P 500 ($SPY)

• The SPY is on track for a small bear market rally
• This could be a good entry for a short-term position to exit before the the market prices in Fed Interest Rate Hikes next week
  • Good position to make 3% to 3.5% if the rally plays out
• Here are some possible scenarios:
  • Depending on how you trade, the peak identified at ~$389 level could be a good exit point to make 3% to 3.5% if you enter now
  • But keep in mind that the market could rally higher and retest the main resistance line from ATH
    • Exiting at ~$389 could mean you’ll miss out on additional gains – you need to assess your risk & greed levels
    • Consult with a financial advisor. Assess your risk tolerances, your time horizon, and goals.
• NOTE:
  • This scenario assumes the Fed will raise rates at 75bp – anything higher and the markets will take a larger hit than anticipated
  • There’s a possibility next week the Fed will raise rates less than 75bp – or not raise rates at all – to amplify the bear rally ahead of Midterm Elections on November 8
  • Also note that Interest Rates are usually priced into the market about 1 week before the Fed makes its decision
• 80% of my portfolio is still in cash – I’m waiting for another crash before buying in my next 20%
  • I’m heavy on the $SPY and the following commodities:
    • Copper ($COPX)
    • Lumber ($LPX)
    • Energy ($SWN)
    • Oil ($OXY)

Bitcoin / $BTC

• Bitcoin is slowly creeping out of the resistance downtrend (on a logarithmic scale)
  • I’m ‘bullish’ here because it’s affirming my thesis that crypto has entered an accumulation phase after capitulation.
• This is where I’m accumulating on the dips. Here’s what I’m accumulating:
  • Polygon / $MATIC
  • Algorand / $ALGO
  • Cosmos / $ATOM
  • Polkadot / $DOT
• NOTE:
  • Bitcoin price action has been more stable and sometimes outperforming the S&P 500
    • This leads me to believe that capitulating events are temporarily over for crypto
  • This could be a good range to accumulate Bitcoin and other notable altcoins in preparation for the next bull run
  • I’m of the opinion that we won’t see another bull run till the latter half of 2023 going into 2024
    • So I’m using this opportunity to accumulate coins at cheap prices

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Your investment strategies could differ from mine based on your risk tolerances, research, and time horizon, so I encourage you to do your own research as information provided by The Rebel Economist or Breaking Metrics should never be considered financial advice.