WARNING: BAD RETAIL REPORT IS GOOD NEWS?!?
In a Nutshell
Markets opened flat after weak retail sales data, which markets interpreted as bullish because softer consumer spending reduces the odds of Fed rate hikes. The speaker booked $3,000 shorting Coreweave after it gapped overbought and broke key support, and he warns against forcing overnight shorts while the broader tape remains bullish above its moving averages. He advises waiting for confirmed reversal signals rather than fighting the uptrend.
These notes were generated by AI and may contain inaccuracies.
Nasdaq market showed conflicting response to today's retail sales report. Markets opened slightly positive and are currently up 0.1%, teeter-tottering at break-even. The S&P 500 is trading at all-time highs on Friday, with potential for markets to rally to end the week strong. Markets have been incredibly bullish and elevated throughout the week. Do not fight the trend if it remains rational and bullish.
Nasdaq is currently testing an oversold range, with potential to break support and move into negative territory. The speaker is up $1,700-$3,000 on the day across open positions, with Micron remaining open and subject to risk.
Coreweave was the most efficient trade of the day, gapping up and becoming overbought - a preferred setup for overbought reversal plays. The speaker opened a short position, added more when direction became favorable, and began taking profits at pre-market support range. The trade generated $2,300 in 10 minutes initially, then reopened as support at 105 broke with 700 shares added, bringing the total to $3,000.
Coreweave is in an oversold range and hasn't broken below the 100s since reporting earnings and gapping up. Breaking below 100 could lead to a significant gap down. Shorting carries greater risk and is not recommended for beginners, with education available in the LPP lesson library.
The speaker offers access to today's 30-35 minute live trading session for beginners considering joining LPP. Interested viewers can message via Instagram (linked in description) requesting to watch the session before joining, specifically mentioning they've never watched LPP live sessions before.
The retail sales report came out worse than expected, showing contraction instead of the anticipated growth. The speaker explains why bad economic news can be good for markets: the Federal Reserve does not want to raise interest rates, and strong consumer spending could justify rate hikes. However, when retail shows consumers are struggling, this indicates economic slowdown and doesn't support rate hikes that would further contract the economy.
The Fed rate monitor tool shows the probability for a rate pause is now more likely due to this report. The Michigan consumer sentiment report came in lower than expected, though markets will focus primarily on the retail sales report.
Markets have been elevated all week but remain bullish, trading above EMA and moving averages. They are approaching overbought levels based on previous patterns and common resistance ranges, though no sell-off confirmation exists. The speaker mentioned PLTR, Coreweave, and potentially SpaceX as overbought reversal setups for potential short swing trades.
However, with overall market environment remaining bullish, there's no reason to enter swing trades shorting individual stocks. When in doubt, it's better to stay in cash and wait for confirmation rather than forcing swing trades that involve holding overnight and over weekends.
Stay patient, stay calculated, allow the bulls to make their money, and then we'll come on in to strike once the opportunity is confirmed
The focus should be on making money rather than forcing trades. Quality setups that align with personal preferences are better than attempting to trade every day. Markets can remain elevated and bullish above moving averages without confirmation of reversal.
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