T3 Live

Scott Redler’s Dog Bytes: Why Rates Matter Now


SPX futures are -10 after a rollercoaster ride overnight. We'll see if there's any commitment to Friday's reversal. 

SPY needs to hold the $432-$433 range. A close below that and it gets very choppy. QQQ's need to hold the $357 area. Watch the 10 year (TNX) and TLT for clues on the broader action. (more on these below)

Now let's dig into some of the individual things I'm watching.

Rates are dictating a lot of the trade because that’s how the computers are programmed. TNX broke below 1.50% and hit 1.46% Friday which helped tech. Watch it today. If the 10 year is going back to the March highs at 1.7%, tech will remain vulnerable.

TLT bounced which helped the tech reversal. It's down today. See if it holds the $143.65 area. Otherwise tech can really get hit. If it tries for green, perhaps we get some red to green action in tech.

Banks should be good to buy on dips as we get higher rates in the coming months. XLF has last week's low at $37.49 to trade against.

BAC had a big move from $40 to $44+ for some. It held the 8 day where I bought some to try and position for better upside. This might be the place to be if rates continue to trend higher. $44.04 is a recent high. I will only add on dips.

The F.A.N.G.-type names have been under pressure and just giving tactical trades for now as rates rise.  

TSLA will be very important today. It had very strong deliveries. Can it hold the early strength and stay above $793-$799 and extend higher? Or does the news get sold? This will be a big measure of sentiment and risks so pay close attention.

NFLX has been the best F.A.N.G. type name and held the 8 day Friday. I'd see if today's dip is buyable. It would be constructive to hold the $599-$608 area. The Squid Game is really popular and is getting a lot of press.

Positions Disclosure as of 10/4/2021 at 8:04 a.m. ET