Results: the FOMC jumps
We had a positive week, but it was jumpy
Quick summary:
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With the FOMC and the QRA behind us, we got a mixed signal for the upcoming period, without a clear directional trend. But on Friday we got a weaker-than-expected jobs report which sparked fears of an economic slowdown amidst persistent inflation, raising the specter of stagflation and keeping investors on edge about potential interest rate cuts later this year. Still, the market rallied on that news, in anticipation of more rate cuts.
For us it was a very volatile week: an initial 2% loss on Wed was compensated by the rallies on Thu and Fri, so we did manage to get to above 1% return for the week. It was not the ideal scenario, but in the end it was a nice swing up.
Not much to expect in terms of economic news this week. A few Fed speakers, but no major events. This week should be more about technical levels.
For paid subscribers, the Saturday newsletter will talk about the earnings results thus far and what the implications of those are for the state of the economy.
The competition
Solid numbers across the board this week on our leaderboard, with impressive stats yet again for SPX and QQQ predictions. Congratulations to this weeks top 10. This upcoming week could be easier to predict if you’re a good technician, but we have full confidence in your abilities even if you’re not. Keep it up!
Consistency is key to staying in the top. And good predictions, obviously.
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Last week’s performance
A mix of bullish sentiments and looming uncertainty, with differing signals from the Fed and the Treasury - one providing immediate relief, the other a more medium-term headwind for assets. This backdrop threatens to create a volatile equity market environment characterized by sharp sell-offs and strong rebounds, indicating a lack of clear directional trends (like it did on Wednesday close, and Thursday open).
This is not the ideal trading environment for ORCA, which only means we need to limit risk exposure for the time being. We saw that last week, when we made the jump from an almost 2% loss on Wed to a 1% gain by Friday.
The earnings season brought some positive surprises from tech giants like Apple, Amazon, Google, and Microsoft, which supported market gains. However, a weaker-than-expected jobs report raised concerns of a potential economic slowdown amidst ongoing inflation, hinting at early signs of stagflation. Looking ahead, markets are expected to remain cautious, with investors closely watching macroeconomic data to gauge the potential for interest rate cuts later in the year.
On the economic front for this week, there are no major events. This makes the week more dependent on technical levels. If you’re a good technician, it should be a relatively easier prediction. In weeks of no major news, markets breaching a major level, or bouncing off it is a good signal for what might happen next.
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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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