Tuesday Target | 52/52
Tuesday Target Finale: Cash For Xmas
The final Tuesday Target of 2024 - 52/52! MFC! Happy holidays. Everything is awesome.
Normally, I’d tee off on some of the dusty old theories peddled by legacy market veterans—more focused on clickbait than delivering modern, actionable insights. But it’s the season of giving, not harping, and tomorrow is Christmas Eve. My nieces and nephews are counting on me to be the ‘cool’ uncle who beats the market, so let’s go.
In the spirit of cutting through the noise, here’s the minimum you need to know to get a feel for who or what’s cooking this holiday season:
Momentum Versus Fundamentals
A relentless chase of price momentum has overshadowed core fundamentals. Sticking with high-fliers can work - until it doesn't. Large-cap, high-quality names remain stable due to passive flows and crowding, but as liquidity dries up, expensive and low-quality segments are likely to bear the brunt of a revaluation.
Cash Levels And The Hidden Red Flag
BofA's Fund Manager Survey shows that cash allocations have fallen to multi-year lows, matching levels that previously marked significant market tops. With all the excitement, prudent investors may want to consider rebalancing or hedging to avoid painful drawdowns.
QT & RRP: The Real Liquidity Crunch
With the RRP facility nearly tapped out, the Fed's balance sheet unwind will begin in full force. As reverse repo usage declines and liquidity support fades, stretched valuations will come under increasing pressure. Once the RRP can no longer support the system, higher volatility may follow, making risk assets particularly vulnerable in a tightening environment.
Get Rich Overnight with Options? Yeah Right...
TUESDAY TARGET: It’s pre-market and pre-trade-close, so let’s not count our chickens before they hatch. But Rumble—our edgy Santa play—just hit back into our Max Profit zone. Let’s see how much we can squeeze out of this one. We’d happily settle for a 50% St. Claus haul.
Check out the trade entry in the Public Chat.
Please note, all content is for educational purposes and isn't personalized for individual portfolios or financial advice. Curious about putting any of these ideas into action? Juri von Randow is here to offer guidance or connect you with the right resources.