CPI Thursday Numbers

[jonnyfrank]

Any thoughts on upcoming CPI numbers? If they come in above 8.3% I'm thinking all hopes of any kind of substantial rally before we hit 20k on Dow is all but squelched. We can all talk about how the news does not impact the "long term", but is sure is smart to look at the big picture so that when the FOAB comes we have more dry powder.

Personally, I don't care if a company like FB or COUP have a bright upside. If I can by them 50% cheaper in a year rather than hold them why would I not do that? So far, shorting continues to work for me.

[Budge]

Any thoughts on upcoming CPI numbers? If they come in above 8.3% I'm thinking all hopes of any kind of substantial rally before we hit 20k on Dow is all but squelched. We can all talk about how the news does not impact the "long term", but is sure is smart to look at the big picture so that when the FOAB comes we have more dry powder.

Personally, I don't care if a company like FB or COUP have a bright upside. If I can by them 50% cheaper in a year rather than hold them why would I not do that? So far, shorting continues to work for me.

Govt numbers/stats are lies. When the lies become too apparent/inconvenient they'll change definitions.

[jonnyfrank]

Budge, I agree. However, they seem to rule and dictate the day. We need to adapt and realize that the market vortex is real, and sometimes momentum takes on a life of its own. The market can go up, sideways, or down. If the PTB really do want to take down the common man, forcing the market into a downward spiral is the best way, since so many of the masses have money in 401k plans and they have no way to play the short side, and the average investor is not even familiar with the idea the money can be made in a down market.

I see a complete coward in the White House. The fact that he rarely addresses the people is proof enough for me that he has nothing but contempt for the general population and is all in on bringing people to their knees.

[bpcw]

Any thoughts on upcoming CPI numbers? If they come in above 8.3% I'm thinking all hopes of any kind of substantial rally before we hit 20k on Dow is all but squelched. We can all talk about how the news does not impact the "long term", but is sure is smart to look at the big picture so that when the FOAB comes we have more dry powder.

Personally, I don't care if a company like FB or COUP have a bright upside. If I can by them 50% cheaper in a year rather than hold them why would I not do that? So far, shorting continues to work for me.

People are reacting to data releases at the moment because they're in a state of panic and the PTB are manipulating the markets in the short term. However, if the PTB decide that it's time the markets went back up as there aren't enough sellers to buy from then all they need to do is comment in some way that indicates that interest rates aren't going to keep going up or inflation isn't that much of an issue and the markets will soar.

You're doing well shorting at the moment, and you have said that you are maintaining a stop loss but will you have the nerve to buy back in, especially if you believe the markets could go so low.

[jonnyfrank]

I realize shorting is not the way to go in the long term (a moving target that "long term", lol). But until I sense a shift in the narrative coming from the Fed I am subscribing to the "don't fight the Fed" mantra for now.

If the CPI numbers are higher than 8.3% AND the Fed says something stupid, I expect a lot more momentum to the downside and anticipate playing the 3x ETFs in that direction. We shall see.

[Yodean]

I realize shorting is not the way to go in the long term (a moving target that "long term", lol).
If the CPI numbers are higher than 8.3%

In investing as in almost every other area of life that I can think of, if it's working for you, double down on it and improve it.

If shorting's working for you, then do it ... do it more, do it better.

I have nothing against shorting - I just don't have a lot of experience with it. In hindsight, the time to really short the markets (for me) would have been Nov. '21 thru Feb. '22 or so.

I think it's a coin flip of what the CPI print will be on Thursday, but I am leaning towards slightly less than consensus expectations. Of course, I was wrong last month. I guessed right the month before, from what I remember.

Another reason not to be short too much right now:

[MarkD]

Grade inflation is the problem. No real "sticky" pricing imo.

Meaning the transfer of wealth is what's ongoing. I have a really busy chart which I won't post as it would result in too many questions but this simple chart shows we have relative price stability IF you don't fall for the commodity price argument. Most goods are improved and raw pricing is not reflective of final product cost as other inputs reduce the overall impact of raw material pricing. Yes, oil is a major factor in pricing, and directly affects production, transport, and storage. But it is transitory. And energy leads every other business cycle. The upcoming cycle will be lead by technology as they trade places. Look at XLE vs XLK on a LT chart and make your own decision.

Anyone with interest can look at the FED funds rate and add inflation (I like to use Pring's $PRII) then compare the sum to the 10 year treasury yield. If the 10 year exceeds feds funds plus inflation, then we have an inflation problem. I have learned over time the 2 year treasury is actually a preferred proxy vs the FED funds rate. Why? It is an accurate measure of market participants. If you substitute the 2 year in the analysis you will determine THE FED IS YANKING YOUR CHAIN! They did it by lagging rates vis-a-vis the 2 year yield on the way up and will likely do so otw down.

https://imgur.com/ZCZ8Bjr

[SOL]

@mark

You might see something in this chart. I will explain it later when time permits, but for now, I am just going to post it and you guys can try to see the pattern. Something big is very close to happening.

The monthly chart of the DOW via DIA