The Play by Play from last week's market turmoil into today's Green God Candle after Inflation CPI
Alrighty - a brief public note to share on the markets after all the commotion that’s been happening.
I’ll simply recap what we did in the community, which in 1 sentence is to prepare for a sharp counter trend bounce. The way to do so was “direct shares only, no call options”.
Here’s the play by play which I gave in Whatsapp for Members.
On Friday NFP Day: “Buy a bit of the ETFs IWM SPY QQQ DIA amid the washout”
Why I said this: Folks - I simply don’t know which individual stocks during moments of massive uncertainty are going to be the winners when the dust settles. I’m not going to pretend like I do. What I did conclude though was that risk/reward at the broad market level was very favorable according to my understanding of DCF Models for the index’s top weighted stocks. If I like the broad market and I don’t want to experience “lock-out risk”, I buy SPY QQQ DIA IWM or its leveraged cousin MES, MNQ, MYM, M2K.
On Monday 1/13: A Gap down and subsequent Recovery. In the pre-market, even though things looked weak again, I said that a counter trend bounce is may begin to develop today through Wednesday. I make these conclusions before the market opens, and I don’t comment afterwards. Why? I’m in the same positions myself. The more I comment, the more I second guess my thinking.
Why I said this: I continued to look at my DCF Levels at the top stocks and along with looking at the index technical structure, found some favorable confluence.
On Tuesday 1/14: Discussed that volatility is here to stay but there is still room for further recovery.
Why I said this: Because nothing changed from my view on Monday. Further Lower prices don’t change my view because we were in an area of value (based on my opinion)
On Wednesday 1/15: Well, you know what happened today. Mega rally. Do I really need to recap the inflation figures?
I had bought direct shares after the FOMC plunge in December. I never took tactical profit on the way up to 6100 ES (perhaps that was a big mistake). Last week on NFP day, we revisited the post FOMC plunge region, so I bought more in that region.
Then Bought more on Monday. Bought more on Tuesday. All at the same FOMC plunge region from December around 5870-5900 ES. I just really liked that area because it represented a Higher Low above the Trump election level.
Did I use leverage? Yes. But at the direct shares/holdings level. In no way would I have the confidence to hold Call Options that have time decay and expiration through these types of binary events. If I believe in a position, I cannot have a time expiration restraint on it.
The outcome is one of my best days that I’ve personally experienced in a while. I hate showing P&L. But I’ve got skin in the game in all the ideas discussed. If I talk about something favorably on Whatsapp, I’m in that trade myself.
What am I doing today? I had built up a huge lot size of direct shares exposure on SPY QQQ DIA IWM using products like MES, MNQ, MYM, M2K (micro-futures).
The net strategy over the last 5 days was to scale in over and over again (painful at the time).
The net strategy today is to protect profits from the market’s gift today. I was looking for a counter trend bounce. Well it has arrived. For further upside, we need the next catalyst. Maybe, even a bit of give-back first.
I’m going to retain market exposure but with less inventory.
If we dip again, I’ll do my best to *again* find entry points for Members.
None of this is financial advice, but in this environment, I am personally focusing on finding the best entry points for the broad market ETFs IWM DIA SPY QQQ rather than individual stocks until the dust settles. This way, when the market bounces, you don’t need to worry about relative drag from a stock not rising even when the market is rebounding.
For the members, I hope my strategy has helped out during these chaotic 2 weeks of 2025. Please allow me to comment on new ideas ONLY* and I mean ONLY when I have something to share.
We need to be Very selective of where and when we are putting capital.
Patience. Patience. Patience.
And Patience.
Could be more opportunities ahead. Even though I’m a bull myself, I do think Bears are a lot stronger this time around. I wouldn’t overstay a big green position and give it back.
Mental capital is actually equally as valuable as monetary capital when things are this volatile.
No patience = No pay day.
If I can help my members harness the human power of deep patience and calm thinking (which is what I do in voice notes on Whatsapp when things get volatile), then that means it’s only a matter of time until they see Pay Day.
Key Investing Resource for Readers (IBKR Supports my Research): Accessing H-Shares is available on IBKR below. Click the link to see how they support Hang Seng trading. Visiting their website to see their brokerage platform (genuinely highly recommended) supports our research efforts to give out more premium content to all. IBKR has access to H-Shares investing and allows investors to get exposure to the Hang Seng (HSI) and its listed companies. Most brokerages do not offer access to H-Shares.
If you are a public reader and would like to give us a little support to help us continue to provide high-quality analysis for all, please visit IBKR (good execution, good research, advanced capabilities).
Interactive Brokers now also has a Forecast Events feature that allows users to place bets on event-driven outcomes (like the macro events).
