Power Plays Weekly Roundup
December 23, 2022
By Scott Redler
Editor's Note: Scott will be on vacation next week so there will most likely be no fresh updates for Power Plays. And don't forget the market is closed Monday.
It was another hard week for the market.
We're looking to close out with a whimper on account of the slightly hot PCE report, which doesn't support the disinflation case.
Plus key names like Apple (AAPL) and Tesla (TSLA) lost yesterday's lows, which is a bad sign.
And we have to worry about tax-loss selling hitting the beaten-down growth names into year-end.
This remains a very predatory market, and it looks like hopes for a year-end rally are starting to disappear.
We've been taking a very cautious approach to this market, and I think that's helped us avoid a lot of trouble.
I believe the SPX is going to break into the 3,200 to 3,400 area in 2023, so we have to be extra-surgical with entries.
At some point, we will get some beautiful buying opportunities, but there is no sense in buying just to buy.
I have some longs on but I'm keeping a tight leash on them.
And if you notice in my disclosures below, I'm also short SPY calls (which make money if the market declines), plus I have am long SPY and AAPL puts.
Until we see real stability and we have good entries, we can't rush into anything.
In the meantime, let's do our best to keep our heads in check. It can be frustrating to sit on the sidelines. But at times like this, we have to focus on cash conservation. Otherwise, we're at risk of getting caught in situations like TSLA, which just fell 60% in 3 months.
Have an amazing holiday. I'll see you in the New Year.
Scott Redler Positions Disclosure as of 2022-12-23 at 11.02.23 AM