From the Desk of Kimmy Sokoloff

The market finished strong yesterday, and we just might need a little breather before the next move.

It starts with credit.

Bottom line.

This isn't crypto where all these shitcoins can go to zero and it won't matter to anyone who matters.

These aren't marijuana stocks that are irrelevant to global asset allocation.

This is the bond market.

This is the biggest and baddest of them all.

We're talking about almost a $120 Trillion asset class.

It's just math: if there is real systemic risk in the equities market, you're going to see it in credit.

There's no way around it.

And so how are credit spreads doing?

As tight as they have been since last summer, and getting tighter:

From the Desk of Kimmy Sokoloff

The market was in wait-and-see mode with Fed Chair Jerome Powell speaking today.

After he spoke, there was a lot of whip.

The most significant insider buy on today’s list is a Form 4 filing by New York Community Bancorp $NYCB Director Ronald A. Rosenfeld.

Rosenfeld reported a purchase of roughly $756,756 in NYCB.

From the Desk of Kimmy Sokoloff

The market may be in a standstill until after Fed Chair Jerome Powell speaks today.

What I'll be watching for today is whether $SPY can break above 411 and trend back up to 415 or so.

From the Desk of Steve Strazza @sstrazza and Alfonso Depablos @Alfcharts

This is one of our favorite bottom-up scans: Follow the Flow.

In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but not both.

We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.

Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.

From the desk of Steve Strazza @Sstrazza.

Welcome back to our latest Under The Hood column where we'll cover all the action for the week ended February 3, 2023. This report is published bi-weekly and rotated on-and-off with our Minor Leaguers column.

What we do here is analyze the most popular stocks during the week and find opportunities to either join in and ride these momentum names higher, or fade the crowd and bet against them.

We use a variety of sources to generate the list of most popular names.

There are so many new data sources available that all we need to do is organize and curate them in a way that shows us exactly what we want: A list of stocks that are seeing an unusual increase in investor interest.

From the Desk of Kimmy Sokoloff

The market was down but pretty much range-bound today.

It was hard to gain traction on the long side, and I was stopped out of a few names.

Both Icahn School of Medicine at Mount Sinai and CMLS Holdings LLC filed Form 4s for a combined amount of $40 million in GeneDx Holdings Corp $WGS.

Activist investor and retail industry entrepreneur Ryan Cohen took a stake in Nordstrom $JWN, sending the stock higher by more than 20% Friday.

From the Desk of Kimmy Sokoloff

I mentioned in Friday's Morning Briefing that if $SPY really breaks below 412.88, we can see 408.

SPY traded in that range this morning. Currently, 408 is support.

If we bounce, we can head back up to 411. If not, we can see 405.13.

Stock market bulls have been rewarded over the past 3 months.

And remember, historically these are the best 3 months of the year - November through January.

And then comes the hangover.

Think about those last three months.

Did you see people having a good time?

Were some having a little too much fun?

Would you agree there was some disorderly conduct?

Were participants behaving as if they were under the influence?

You bet.

And this sort of behavior is normal for this time of the year, and the entire 4-year cycle for that matter.

But then comes February - one of the worst months of the year.

"I only trade U.S. Stocks, JC"

"If you can't find a stock in America to buy you're not looking hard enough, JC"

"I live in America, JC"

"I don't know anything about those stocks in other countries, JC"

Trust me, I hear all these things.

Not so much from you guys, as it is my friends and colleagues in the business.

I feel like readers of Allstarcharts know better, and also we have a very global audience.

So the recency bias that oozes out of most American investors, who have gotten accustomed to the U.S. being the best place to be, forgot what it's like when that's not the case.

You're talking about a decade of outperformance, and depending on how you measure it, you can even argue that's it's been a decade and half of U.S. dominance.

But believe it or not, stocks traded before 2011.

The U.S. wasn't always the global leader in equities.