Is The Stock Market About To Get Worse? (Don't Panic!)
In a Nutshell
Markets are volatile after PPI came in hotter than expected, pushing rate-hike odds to 69-70 % and keeping the Nasdaq pinned at its 700 support level ahead of tomorrow’s CPI print. Traders who shorted semis/SanDisk captured 3–4 % intraday but are advised to stay flat until direction and momentum align; holding cash is the safest stance in consolidation. A CPI beat would raise borrowing costs for debt-heavy AI names, while a miss would ease pressure and could trigger a relief rally.
These notes were generated by AI and may contain inaccuracies.
Inflation came in higher than expected. The NASDAQ market was down 1.2% to lows of 706 following the PPI data report. The PPI report was released at 5.4%, exceeding the 5.3% expectation. This increase raises the probability that the Federal Reserve will raise interest rates next week from 60% to 69-70%.
The next rate decision is scheduled for Wednesday, September 16th at 2:00 p.m. Eastern time. A Federal Reserve rate increase would be bearish for markets as it increases borrowing costs for individuals and businesses. This is particularly relevant to the AI sector, which is heavily financed through debt in the billions. Higher interest rates would increase financing costs, reduce margins, and lower earnings for these companies.
The CPI data report is scheduled for the following day. The LPP trading team shorted SanDisk and semiconductor/memory chip stocks during the live trading session. Some traders achieved gains of 3-4% on SanDisk shorts, with individual profits ranging from $2,500 to $7,000. However, short positions should only be maintained if markets show continuation into the downside.
The NASDAQ has established support around the 700 level. Markets are currently consolidating rather than showing clear directional movement. Shorting is not advisable during consolidation phases when markets are looking for recovery reasons. The speaker emphasizes patience and avoiding early entries, noting that direction and momentum must align for profitable trades.
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