Results: still riding the bull
3.7% gain last week, in the wake of a dovish FOMC
Quick summary:
This is the final week for our Q1 competition! Let's make it count. - click here. It’s a shorter week, markets are closed on Friday, so the predictions you’ll be making are for Thursday close.
Last week, the Federal Reserve kept to their promise of three rate cuts this year. It was a dovish sign that triggered a rally on Wed and Thu. Our take was that this was a clear signal that the Fed is more committed to growth, rather than bringing inflation down to 2% in the short run.
Positioning long gave us a 3.7% gain last week. We were riding even higher, but the flat price action on the rest of Thu and Fri slightly lowered our returns.
The PCE index will be released on Friday, but there’s no trading on Friday, so its impact is likely to be felt early next week. Keep that in mind. In addition, we get housing market data and consumer sentiment reports will provide additional insights into the economic climate.
This weekend, we’ll sum up the quarterly results of the fund. Q1 is almost over, and we’re quite happy with how it fared.
The competition
As we enter the final week of Q1 competition, let’s keep our eyes on the prize. Performance thus far has been spot-on, and it’s time to bring that same precision to the closing days.
It’s time to make this last week count. The top 20 winners will be announced next week. Good luck!
NOTE: For all those new to the whole thing, read more about it here or watch a video of Scott and myself guiding you through the survey, showing you all its features, and briefly explaining how the competition works.
Last week’s performance
The Federal Reserve's meeting ended with no change to their plans this year to cut interest rates three times. The markets were pricing this in since the December meeting, but lately there have been some concerns whether the Fed does indeed stick to its projections due to higher than expected inflation.
As we made it clear last week before FOMC, no change in rate cut projections was to be bullish. It was indeed. Markets rallied on the news on Wednesday before close, and opened gap up on Thursday. After that, it was not the most exciting price action, as markets mostly consolidated, never going down below the Wed close actually.
As for ORCA, we were up over 4.5% on Thu open, but then saw some of those gains deplete by the end of day and into Friday, bringing us down to 3.7% for the week. The big bullish push on Wednesday during Powell's press conference was enough to make for another great trading week.
This week, the market will mainly focus on key economic data despite the shortened trading schedule due to Good Friday. The spotlight will be on the Personal Consumption Expenditures (PCE) index, the Federal Reserve's favored inflation gauge, coming up on Friday. This follows recent signs of inflation ticking up after a period of cooling down. Be aware that there is no trading on Friday, so the pricing in of those numbers will happen next week, on Monday. Additionally, reports on housing market conditions and consumer sentiment will offer insights into the broader economic outlook.
…join the $20,000 competition!
Join our survey competition to get an opportunity to participate in our quarterly ($5000) and annual (3% of our profits) prize distributions:
DISCLAIMER: Neither the survey nor any of the contents of this website can act as investment advice of any kind. The results of the survey need not correspond to actual market preferences or trends, so they should be interpreted with caution. Oraclum Capital, LLC (Henceforth ORCA) is a management company responsible for running the ORCA BASON Fund, LP, and for organizing a survey competition each week, where it invites the subscribers to its newsletter (this website) to participate in an ongoing prediction competition. The information presented on this website and through the survey competition should under no circumstances be used to solicit any investment advice, nor is it allowed to be of commercial use to any of its readers. The survey and this website contain no information that a user may use as financial or investment advice. All rights reserved. Oraclum Capital LLC.
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