README

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General Market commentary

This is the first post in a week since S&P 500 is down 2.57% today. Therefore CL Capital is glad to offer our thoughts on the market. Even though the FOMC statement stays dovish, market still sold off because the FED “didn’t beat the expectation” XD. Jokes aside, the market looks increasingly dangerous now for the short term. S&P500 has broken down a rising trendline as well as its 20 day EMA support. Tomorrow will be the KEY date for the stock market direction. CL Capital is being extra cautious right now and taking a wait-and-see approach.

Quantative market model signal

Midterm trend: neutral (downgraded from bullish)
Midterm risk: high (downgraded from neutral)

Featured charts

Of course we need to talk about GameStop. This heavily shorted stock rocketed a whopping 2000%+ in a MONTH. What we are witnessing here is historical. An army of retail traders squeezed a number of wall street hedge funds. Besizes the mind-blowing short squeeze, there are further chain effects! For example, those hedge fund shorting GameStop will be forced to liquidate other holdings to meet margin requirements. This is one of the reasons that many quality growth stocks got hammered recently. For long term investors, this will create a good dip buying opportunity ONCE the short squeeze frenzy is OVER. For short term speculators, please try to stay on the sidelines unless you can navigate the up and downs in a volatile market smoothly.