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Buyem: SP500 Levels, Refreshed

Takeaway: I bought this SPY on my line. I also bought the US Dollar (UUP) again today. The SPY vs USD correlation = ) +0.84 right now.

POSITIONS: 19 LONGS, 8 SHORTS @Hedgeye

We are well aware that this week’s news on the jobs front (both NSA Rolling Claims and the Monthly Jobs Report) weren’t good; at least not as good as the employment news has been. That’s now another market opportunity – what if next week’s jobless claims improve?

What if the mortgage rate for a 30yr falls back to where it was 3 months ago? What if the US Dollar continues to strengthen? What if Oil prices continue to fall? Plenty of questions to answer for tomorrow as people are forced to react to what’s now old news today.

Across our core risk management durations, here are the lines that matter to me most:

  1. Immediate-term TRADE resistance = 1575
  2. Immediate-term TRADE support = 1540
  3. Intermediate-term TREND support = 1502

In other words, A) we held TRADE support (1540) this morning and B) I’m giving you a higher (all-time) high of resistance (1575). I am only giving you these because my quant model gave them to me. I do what she says.

I bought this SPY on my line. I also bought the US Dollar (UUP) again today. The SPY vs USD correlation = ) +0.84 right now. So if the US Dollar makes another higher-low here and VIX makes another lower-high, you know what to do.

Enjoy your weekend,

KM

Keith R. McCullough
Chief Executive Officer

Buyem: SP500 Levels, Refreshed - SPX