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META beats top and bottom up 4%

This should help Mag 7
All up in the pre-market…AI trade is still going strong
 
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Sweet rally today, and awesome big tech earnings. I plan to take 10% off post-liberation day longs at the open tomorrow. Was looking for last-FOMC print & presser prices, and we're there right now on Nasdaq futures. Hope to take another 10% off on test of 200-day-MA on QQQ/SPY, and again at ATH retest if we get there.

Am not confident we're out of the woods yet, but have to respect what price is saying and it keep going up. If we are to sell again to new lows, think that it will oddly enough be trade deals Trump strikes with the rest of the world ex-China that precipitates the sell off. I suspect we are asking other countries to follow our lead and basically cease trading with China in exchange for continued security gaurantees. Like @SpikeUM mentioned, shifting low value goods production out of China doesn't take very long. It's the high value stuff that will take time and a lot of money (and the Chinese have gotten really good at it, not sure we can say the same about India right now). If the plan is to use India and other Asian countries as China manufacturing replacements for high-value tech goods and components, while we also bring more advanced manufacturing back stateside, I think there will be some choppy times ahead as markets try to wrap their head around a new global trade and security framework.

Amazon earnings tomorrow will be very interesting. They're the most exposed to tariffs on China with their marketplace, but also have invested heavily into AI like the other Mag7. Jobs report on Friday too.
 
Did some research on historical price action after a 20%+ drop (calculated with intraday high/lows, not closes) from ATH on S&P. Since I'm a simpleton, it makes sense for me to put lion's share of cash at risk when price comes back from a 20%+ drop to set a new ATH.

Simpleton logic: price hit high price it's never hit before after previously losing 1/5th+ of its value, therefore it gonna keep going up with minimal drawdown. All these are post 1950, with the first 20%+ drop from ATH after 1950 in '56. Currently max S&P drawdon in this price correction is 21.4%.

The drawdown is the max intraday drawdown from the prior ATH after a new ATH was set, and gain is the maximum price it ran until a new 20%+ decline began
  • ATH: 49.64 --> 21.5% drop (07/56-10/57) --> nATH 09/58 --> max drawdown (DD) ~0pt (0%) / max gain (G) 23pt (46.3%) --> Reward:Risk R:R): 23:1 (for simplicities sake)
  • ATH: 72.64 --> 29.3% drop (12/61-06/62) --> nATH 08/63 --> DD: 3.16pt (4.4%) / G: 22.08pt (30.4%) --> R:R: 7:1
  • ATH: 94.72 --> 23.7% drop (02/66-10/66) --> nATH 04/67 --> DD: 7.99pt (8.4%) / G: 14.65pt (15.5%) --> R:R: 1.8:1
  • ATH: 109.37 --> 37.3% drop (12/68-05/70) --> nATH 03/72 --> DD: 5.54pt (5.1%) / G: 12.37pt (11.3%) --> R:R: 2.2:1
  • ATH: 121.74 --> 49.9% drop (01/73-09/74) --> nATH 07/80 --> DD: 4.29pt (3.5%) / G: 20.22pt (16.6%) --> R:R: 4.7:1
  • ATH: 141.96 --> 28% drop (11/80-08/82) --> nATH 11/82 --> DD: 9.07pt (6.4%) / G: 195.93pt (138%) --> R:R: 21.6:1
  • ATH: 337.89 --> 35.9% drop (08/87-10/87) --> nATH 07/89 --> DD: 18.06 pt (5.3%) / G: 31.79pt (9.4%) --> R:R: 1.8:1
  • ATH: 367.31 --> 20.4% drop (07/90-10/90) --> nATH 02/91 --> DD: 10.36pt (2.8%) / G: 820.90pt (222.1%) --> R:R: 79.2:1
  • ATH: 1190.58 --> 22.5% drop (07/98-10/98) --> nATH 11/98 --> DD: 53.69pt (4.51%) / G: 362.53pt (30.5%) --> R:R: 6.8:1
  • ATH: 1553.11 --> 50.5% drop (03/00-10/02) --> nATH 07/07 --> DD: 886.32pt (57.1%) / G: 22.98pt (1.5%) --> R:R: .03:1
  • ATH: 1576.09 --> 57.7% drop (10/07-02/09) --> nATH 04/13 --> DD: 40.06pt (2.5%) / G: 1363.77 (86.5%) --> R:R: 34:1
  • ATH: 2939.86 --> 20.2% drop (10/18-12/18) --> nATH 04/19 --> DD: 211.05pt (7.2%) / G: 453.66pt (15.4%) --> R:R: 2.1:1
  • ATH: 3993.52 --> 35.4% drop (02/20-03/20) --> nATH 08/20 --> DD: 184.07pt (5.4%) / G: 1425.1pt (42%) --> R:R: 7.7:1
  • ATH: 4818.62 --> 27.5% drop (01/22-10/22) --> nATH 01/24 --> DD: 103.8pt (2.2%) / G: 1328.81pt (27.6%) --> R:R: 12.8:1
13/14 cases with favorable R:R. 9/14 with R:R of at least 4:1. 5/14 with R:R of at least 10:1. The one failure was of course the GFC after we just barely swept the ATH from before the Dot Com bust.

I think a lot of folks worry about missing the bottom and the rocket ship gains that come the weeks immediately following the bottom. However, if you're keen to pick bottoms you probably end up picking a bunch of spots that weren't actually bottoms, and either end up putting most/all your cash to work in disadvanteous spots and/or getting margin called.

IMO, dip buying and buying ATH breakouts (without 1/5th decline in price), which are really just two sides of the same coin, work great when we're in a bull market, but aren't viable strategies once price declines 20%+. Have to consider that in the last 60 years, nearly half that time price chopped around and really went nowhere ('65-82 & '99-13 & perhaps now till whenever lol).

If price breaks above ATH after a 20%+ decline, save for GFC, the max DD we've seen is 8.4%. That potential for failure can be mitigated by stopping yourself out on any nATH longs when and if S&P sells off 10% from the prevous ATH. Contra, there are more than a few cases of price dropping 20-25%, then rallying significantly (like now), then selling off 30-50% more.

Right now Mkt looks a lot like like it did in mid-Jan '19 or April '20 when it kept on rocketing up. It also looks a lot like it did in October '00/May '08 March '22, when there was minimal upside left and ~47/53/22%, respectively, further % declines. If we open up where futures are trading right now, all we will need is another ~9% of gains to get back to ATH on S&P. For me, that's when I plan to deploy most of my cash. Don't have any urge to add to anything at these prices. Happy to continue taking 4%+ a year on the cash in money market fund in brokerage account.

Happy investing and trading!
 
flips said:
Did some research on historical price action after a 20%+ drop (calculated with intraday high/lows, not closes) from ATH on S&P. Since I'm a simpleton, it makes sense for me to put lion's share of cash at risk when price comes back from a 20%+ drop to set a new ATH.

Simpleton logic: price hit high price it's never hit before after previously losing 1/5th+ of its value, therefore it gonna keep going up with minimal drawdown. All these are post 1950, with the first 20%+ drop from ATH after 1950 in '56. Currently max S&P drawdon in this price correction is 21.4%.

The drawdown is the max intraday drawdown from the prior ATH after a new ATH was set, and gain is the maximum price it ran until a new 20%+ decline began
  • ATH: 49.64 --> 21.5% drop (07/56-10/57) --> nATH 09/58 --> max drawdown (DD) ~0pt (0%) / max gain (G) 23pt (46.3%) --> Reward:Risk R:R): 23:1 (for simplicities sake)
  • ATH: 72.64 --> 29.3% drop (12/61-06/62) --> nATH 08/63 --> DD: 3.16pt (4.4%) / G: 22.08pt (30.4%) --> R:R: 7:1
  • ATH: 94.72 --> 23.7% drop (02/66-10/66) --> nATH 04/67 --> DD: 7.99pt (8.4%) / G: 14.65pt (15.5%) --> R:R: 1.8:1
  • ATH: 109.37 --> 37.3% drop (12/68-05/70) --> nATH 03/72 --> DD: 5.54pt (5.1%) / G: 12.37pt (11.3%) --> R:R: 2.2:1
  • ATH: 121.74 --> 49.9% drop (01/73-09/74) --> nATH 07/80 --> DD: 4.29pt (3.5%) / G: 20.22pt (16.6%) --> R:R: 4.7:1
  • ATH: 141.96 --> 28% drop (11/80-08/82) --> nATH 11/82 --> DD: 9.07pt (6.4%) / G: 195.93pt (138%) --> R:R: 21.6:1
  • ATH: 337.89 --> 35.9% drop (08/87-10/87) --> nATH 07/89 --> DD: 18.06 pt (5.3%) / G: 31.79pt (9.4%) --> R:R: 1.8:1
  • ATH: 367.31 --> 20.4% drop (07/90-10/90) --> nATH 02/91 --> DD: 10.36pt (2.8%) / G: 820.90pt (222.1%) --> R:R: 79.2:1
  • ATH: 1190.58 --> 22.5% drop (07/98-10/98) --> nATH 11/98 --> DD: 53.69pt (4.51%) / G: 362.53pt (30.5%) --> R:R: 6.8:1
  • ATH: 1553.11 --> 50.5% drop (03/00-10/02) --> nATH 07/07 --> DD: 886.32pt (57.1%) / G: 22.98pt (1.5%) --> R:R: .03:1
  • ATH: 1576.09 --> 57.7% drop (10/07-02/09) --> nATH 04/13 --> DD: 40.06pt (2.5%) / G: 1363.77 (86.5%) --> R:R: 34:1
  • ATH: 2939.86 --> 20.2% drop (10/18-12/18) --> nATH 04/19 --> DD: 211.05pt (7.2%) / G: 453.66pt (15.4%) --> R:R: 2.1:1
  • ATH: 3993.52 --> 35.4% drop (02/20-03/20) --> nATH 08/20 --> DD: 184.07pt (5.4%) / G: 1425.1pt (42%) --> R:R: 7.7:1
  • ATH: 4818.62 --> 27.5% drop (01/22-10/22) --> nATH 01/24 --> DD: 103.8pt (2.2%) / G: 1328.81pt (27.6%) --> R:R: 12.8:1
13/14 cases with favorable R:R. 9/14 with R:R of at least 4:1. 5/14 with R:R of at least 10:1. The one failure was of course the GFC after we just barely swept the ATH from before the Dot Com bust.

I think a lot of folks worry about missing the bottom and the rocket ship gains that come the weeks immediately following the bottom. However, if you're keen to pick bottoms you probably end up picking a bunch of spots that weren't actually bottoms, and either end up putting most/all your cash to work in disadvanteous spots and/or getting margin called.

IMO, dip buying and buying ATH breakouts (without 1/5th decline in price), which are really just two sides of the same coin, work great when we're in a bull market, but aren't viable strategies once price declines 20%+. Have to consider that in the last 60 years, nearly half that time price chopped around and really went nowhere ('65-82 & '99-13 & perhaps now till whenever lol).

If price breaks above ATH after a 20%+ decline, save for GFC, the max DD we've seen is 8.4%. That potential for failure can be mitigated by stopping yourself out on any nATH longs when and if S&P sells off 10% from the prevous ATH. Contra, there are more than a few cases of price dropping 20-25%, then rallying significantly (like now), then selling off 30-50% more.

Right now Mkt looks a lot like like it did in mid-Jan '19 or April '20 when it kept on rocketing up. It also looks a lot like it did in October '00/May '08 March '22, when there was minimal upside left and ~47/53/22%, respectively, further % declines. If we open up where futures are trading right now, all we will need is another ~9% of gains to get back to ATH on S&P. For me, that's when I plan to deploy most of my cash. Don't have any urge to add to anything at these prices. Happy to continue taking 4%+ a year on the cash in money market fund in brokerage account.

Happy investing and trading!
Click to expand...
That’s interesting. It seems like you are waiting on the health of the market vs. the price of the market. Since no one can predict the future, it seems wise to gauge on fundamentals rather than pretending to know when or where the market will turn.
If we do return to all time highs it may be a result of information we don’t have today.
 
07:30 USD Challenger Job Cuts (Apr) 105.441K 275.240K
07:30 USD Challenger Job Cuts (YoY) 62.7% 204.8%
08:30 USD Continuing Jobless Claims 1,916K 1,860K 1,833K
08:30 USD Initial Jobless Claims 241K 224K 223K
08:30 USD Jobless Claims 4-Week Avg. 226.00K 220.50K
09:30 CAD S&P Global Manufacturing PMI (Apr) 45.3 46.3
09:45 USD S&P Global Manufacturing PMI (Apr) 50.2 50.7 50.2
10:00 USD Construction Spending (MoM) (Mar) -0.5% 0.2% 0.6%
10:00 USD ISM Manufacturing Employment (Apr) 46.5 44.7
10:00 USD ISM Manufacturing New Orders Index (Apr) 47.2 45.2
10:00 USD ISM Manufacturing PMI (Apr) 48.7 48.0 49.0
10:00 USD ISM Manufacturing Prices (Apr) 69.8 72.9 69

Jobless claims up
ISM manufacturing PMI up
AMZN and APPL after the bell.
 
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TheEye said:
That’s interesting. It seems like you are waiting on the health of the market vs. the price of the market. Since no one can predict the future, it seems wise to gauge on fundamentals rather than pretending to know when or where the market will turn.
If we do return to all time highs it may be a result of information we don’t have today.
Click to expand...
No, am literally waiting on price, that's pretty much my only concern. Although it's probably axiomatic that the market is also healthy if it had been at an ATH, lost 1/5th+ of it's value then returned to that ATH.

Apple is perhaps the best individual stock example of this - it's at an ATH, it tanks, it returns to that ATH, then it barely sells and you can hold your long till you die:

AAPL_2025-05-01_10-24-07_56a0b.png


(hopefully the labels on the pic are legible)

Like, I'm a degenerate and love to trade, but if I want to invest long term (basically just set and forget it) with size, there's not a setup I like more than buying nATH after a huge drop. There's no guesswork on picking a bottom and your risk is clearly defined, and it's pretty rare that the setup fails. Accenture back in February is an example, it swept the 12/21 ATH by like .13pt then dropped 30%. They're usually good for a backtest or two, years later, like you can see on the AAPL chart. S&P and NDX lows during this current 20%+ correction pretty much backtested to the tick of the 2021 ATH's before the last bear market.
 
flips said:
No, am literally waiting on price, that's pretty much my only concern. Although it's probably axiomatic that the market is also healthy if it had been at an ATH, lost 1/5th+ of it's value then returned to that ATH.

Apple is perhaps the best individual stock example of this - it's at an ATH, it tanks, it returns to that ATH, then it barely sells and you can hold your long till you die:

View attachment 324472

(hopefully the labels on the pic are legible)

Like, I'm a degenerate and love to trade, but if I want to invest long term (basically just set and forget it) with size, there's not a setup I like more than buying nATH after a huge drop. There's no guesswork on picking a bottom and your risk is clearly defined, and it's pretty rare that the setup fails. Accenture back in February is an example, it swept the 12/21 ATH by like .13pt then dropped 30%. They're usually good for a backtest or two, years later, like you can see on the AAPL chart. S&P and NDX lows during this current 20%+ correction pretty much backtested to the tick of the 2021 ATH's before the last bear market.
Click to expand...
It seems like the most rational way to chart.
 
APPL- 100 billion buyback, dividend increase
concerns about China and moving into India…
Down 2%
 
USD Average Hourly Earnings (YoY) (YoY) (Apr) 3.8% 3.9% 3.8%
08:30 USD Average Hourly Earnings (MoM) (Apr) 0.2% 0.3% 0.3%
08:30 USD Average Weekly Hours (Apr) 34.3 34.2 34.3
08:30 USD Government Payrolls (Apr) 10.0K 15.0K
08:30 USD Manufacturing Payrolls (Apr) -1K -5K 3K
08:30 USD Nonfarm Payrolls (Apr) 177K 138K 185K
08:30 USD Participation Rate (Apr) 62.6% 62.5%
08:30 USD Private Nonfarm Payrolls (Apr) 167K 124K 170K
08:30 USD U6 Unemployment Rate (Apr) 7.8% 7.9%
08:30 USD Unemployment Rate (Apr) 4.2% 4.2% 4.2%

Non farm payrolls higher than expected for April
Unemployment rate the same
 
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