Waiting for data to confirm
Earnings, retail sales, and technical pivot points
Quick summary:
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Pivot at 710: Failing to reclaim this level could shift market liquidity and trigger a slide toward the 700 or 693 support zones.
Overbought Momentum: The long-term trend remains bullish, but high RSI readings suggest the market is overextended and due for a consolidation phase.
Data-Heavy Week: Retail sales reports and major earnings (Tesla, GE) will provide the necessary “stress test” for the current breakout.
Likely Outcome: Expect choppy trading between 700 and 715; however, a high-volume break below 700 would signal a trend reversal.
ORCA
We are not even halfway through April, and ORCA is already up 3.87% gross, bringing our YTD to 13.25% gross (10.75% net). Navigating both legs of the market very well thus far. Grinding up, slow linear growth.
DISCLAIMER: For accredited investors only. This is not financial or investment advice. It cannot be interpreted as investor solicitation, nor does it constitute an offer to buy or sell. Past performance is not indicative of future returns. We are allowed to “generally solicit and advertise” the existence of the fund under Rule 506(c) of Regulation D of the Securities Act of 1933 in the United States, but we are only allowed to respond to accredited investors.
Charts
After a massive run to all-time highs fueled by ceasefire optimism and a risk-on surge, SPY finds itself at a critical technical crossroads. The daily trend remains undeniably bullish, with the price comfortably above the 50-day and 200-day moving averages. However, momentum is starting to look stretched; RSI is currently screaming overbought at 73.1, and we are seeing a lower high forming on the 4-hour timeframe. The 710 level has emerged as the new line in the sand. On Friday, SPY slipped through this zero-gamma level, suggesting that dealers have flipped from buying the dip to chasing the move. If the bulls can’t reclaim 710 early this week, the short-gamma environment could quickly accelerate a slide toward the 700 magnet or even the 693 support zone. Over the long run, a retest of that zone and bounce would be a great thing for bulls.
The fundamental calendar is equally heavy, turning this into a classic “show-me” week for the bulls. We are entering the heart of earnings season with heavyweights like Tesla reporting Wednesday. On the macro front, all eyes are on the US Retail Sales data and the potential impact of the ongoing geopolitical situation on inflation. With US Retail Sales data on Tuesday and preliminary PMI data on Thursday, the market is looking for confirmation that the economy isn’t cooling too fast. The most likely scenario remains a period of choppy consolidation between 700 and 715; however, a break below 700 on high volume would signal that the war-induced “melt-up” has officially run out of gas. Stay disciplined and watch the 710 reclaim attempt; it will tell you everything you need to know about the trend for the rest of April.
The competition
Narratives are shifting faster than the tape, but the prices don’t lie: we are officially in a V-shaped recovery. After a volatile March that saw the SPY test the low 630s, the bulls have come charging back, pushing the S&P 500 to new all-time highs above the 710 mark. With a provisional ceasefire in the Middle East easing geopolitical tensions and Treasury yields stabilizing, the “cautiously bullish” tone of last week has shifted into a full-scale momentum trade.
However, with the Nasdaq notching a historic winning streak and the VIX finally retreating below 20, the question for this week is simple: Is this a breakout or a blow-off top? As we enter a heavy week of earnings and fresh PMI data, your ability to separate the signal from the noise has never been more critical.
Stay focused and keep climbing the ranks!
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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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