Make or Break Monday – Powell Testifies with S&P at the Weak Bounce Line


It’s going to be an interesting week.

SPX March 6 2023

It took us two weeks to make our Weak Bounce Line at 4,040 and failing the weak bounce would be devastating and 4,080 is our Strong Bounce Line but we have no technical resistance so it’s all about what Powell says to Congress tomorrow and Wednesday (10am).  We also have Non-Farm Payrolls on Friday and some bond auctions but nothing trumps Powell.

Calendar March 6 2023

Warren (PSW’s AI mascot) says:

There are several high-impact data releases that could affect the financial markets, such as the Factory Orders, Nonfarm Payrolls, Unemployment Rate, and Average Hourly Earnings.

  • On March 6th, Factory Orders data for January is expected to be released. The data measures the change in the total value of new purchase orders placed with manufacturers, and it is expected to decrease by 2.0%, which could impact the market sentiment, but the overall effect is likely to be low.
  • On March 7th, the Wholesale Inventories for January will be released, which measures the change in the total value of goods held in inventory by wholesalers. A decrease of 0.4% is expected, indicating a slowdown in the economy, but this is unlikely to have a significant impact on the markets.
  • Also on March 7th, Consumer Credit data for January will be released. This report tracks the change in the total value of outstanding consumer debt, such as credit card debt and personal loans. The data is expected to increase to $17.5 billion, indicating stronger consumer spending, which could positively affect the markets.
  • On March 8th, the ADP Employment Change for February is scheduled to be released. This report measures the monthly change in non-farm, private employment, and it is expected to increase to 200K, indicating a healthy job market, which could positively affect the market sentiment.
  • The same day, the Trade Balance data for January will also be released. This report measures the difference between the value of exports and imports of goods and services, and it is expected to decrease to -$69.0 billion, which could indicate a weaker economy, but it is unlikely to have a significant impact on the markets.
  • On March 9th, Initial and Continuing Claims data for the first week of March will be released. These reports track the number of individuals who filed for unemployment benefits, and they are expected to increase slightly. High-impact data like these could affect market sentiment, particularly if the actual figures deviate significantly from the forecasts.
  • Also, on March 10th, the Nonfarm Payrolls report for February will be released, which is considered the most important economic indicator. This report measures the change in the number of employed people in the US, excluding the farming industry. A healthy increase of 220K jobs is expected, which could positively impact the markets.

In conclusion, this week’s economic data releases are expected to provide valuable insight into the performance of the US economy in January and February. While some data releases have the potential to impact market sentiment, such as the Nonfarm Payrolls and Initial Claims, the overall impact is likely to be moderate.

Investors will be looking for any hints or signals from Powell on how the Fed views the current economic situation, especially regarding inflation, growth, and interest rates.  The  Chairman is expected to back a quarter point rate hike in March and keep the door open for more hikes later this year if needed.  He is also likely to speak about the potential impact of the Ukraine conflict on Global Financial Stability and Monetary Policy.

Then we have earnings.  There are 300 companies scheduled to report this week but we’re generally into the smaller-cap companies but it’s important to get an idea of what’s going on as these companies employ far more people than the S&P 500 do – so trends we see here are going to have a real impact on the Q2 economy.  

The most anticipated earnings releases scheduled for the week are CrowdStrike #CRWD, Sea Limited #SE, DICK'S Sporting Goods #DKS, Ciena #CIEN, #JD, Azul #AZUL, ULTA Beauty #ULTA, DocuSign #DOCU, MongoDB #MDB, and BJ's Wholesale Club #BJ.

Let’s keep in mind that we are, in fact, already in a bear market and simply struggling to get out of it.  If we do, however, it will be unique compared to 10 other bear markets we’ve experienced in the last 100 years.  As you can see on this chart, we’re still hovering down about 20% off the highs of about a year ago.  

Unfortunately, stimulus generally gets us out of these things and there is no more stimulus coming.  We’ll be lucky if the reverse doesn’t happen and the Government shuts down…  This is why we need to remain cautious but we are still adding some new trades from our watch list and, just last week, I appeared on Money Talk and we added both IBM and QCOM to our portfolio.

We’re looking closely at other companies that will benefit from the rise of AI over the rest of the decade and we’ll be making some trading decisions this week so join us inside for our Live Member Chat Room each day during market hours.  

  • Salesforce (CRM) came to my attention over the weekend.  They are a leader in cloud-based customer relationship management (CRM) software that leverages AI to help businesses improve their sales, marketing, service, and e-commerce operations. Salesforce’s AI platform is called Einstein, which provides features such as predictive analytics, natural language processing, recommendation engines and chatbots. Salesforce has also acquired and integrated other AI companies such as Tableau and Slack to enhance its offerings.
  • Snap (SNAP) is another social media company which runs Snapchat, a popular app that allows users to send disappearing messages, photos, and videos.  Snap also develops innovative features such as augmented reality filters, lenses, and Bitmoji Avatars that use AI to enhance their user experiences.  Snap also invests in AI research through its Snap Research team, which I find very interesting.  
  • Veritone (VERI) is a software company that provides an AI platform for various industries such as media, entertainment, legal, government, and education. Veritone’s platform allows users to analyze and process large amounts of audio video and text data using cognitive engines such as speech recognition face detection sentiment analysis and natural language understanding. Veritone also offers solutions for content monetization compliance and security.  They are very small ($270M at $7.44) but sales are growing fast and they have enough in the bank to get profitable by next year.  
  • Splunk (SPLK) is a software company that specializes in data analytics and monitoring for IT operations security and business intelligence. Splunk’s products use AI to help customers collect index search correlate visualize and report on data from various sources and systems. Splunk also offers solutions for cloud computing machine learning internet of things (IoT) and blockchain.
  • Twilio (TWLO) is a cloud communications platform that enables developers to build and integrate voice, video, messaging, and email applications using APIs. Twilio also leverages AI to provide features such as speech recognition, natural language processing, sentiment analysis, and conversational bots. Twilio has also acquired and integrated other AI companies such as SendGrid, Segment, and Electric Imp.
  • UiPath (PATH) is a software company that provides robotic process automation (RPA) solutions for enterprises. UiPath’s products allow users to automate repetitive and mundane tasks using software robots that mimic human actions. UiPath also uses AI to enhance its RPA capabilities with features such as computer vision, document understanding, natural language processing, and machine learning.  As AI gets better, so do their products.  

None of these companies falls into our typical “Value” investing model but it gives us an idea of what to look for in what could be the start of a new “Dot Com”-type of bubble – and there’s nothing wrong with a bubble if you get in on the ground floor and get out before it pops, right?  


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This is fascinating, rest assured I would buy this book.
Two things. I assume you’ve read Graeber’s economics books (, – maybe ask Warren about that…
and second, you used to talk a lot about the velocity of money, and I think your black hole metaphor has a lot to do with that.

Just one quick note: if you will use actual people as examples I would pick one more hated by your target demographic like the one of the Koch’s, or Elon, or Zuckerberg… Not that I am a fan of Gates, but I think these days he is less harmful.

Good morning!

Thinking of an experiment – Buy some BYND, and sell the Apr $1 calls (the lowest strike). The current short borrowing rate is >100% (and fidelity keeps half, I get the rest – I have already confirmed this based on how much interest I received on a handful of shares last month) – when lent out, the Apr short calls are considered naked short calls for margin purposes – however, I can always recall the shorts when needed, so am protected till $1. The question now becomes, what is the cash interest on this protected trade.

Note that the interest is calculated on a daily principal (i.e. as the value of the stock falls, the $ amount of the interest also decreases, even if the percent is the same).

Good morning,

im setting up an F play – wanted to see what you thought of ;

All June ‘25
$10/$15 spread @ $2.25 offset by 1/4 quantity of short $11 puts ($1.80). Cost per spread $1.85


$10/$20 @ $3.50 offset by 1/4 $14 puts ($3.30). Cost per spread $2.60


Phil/VALE: Please let me know your thoughts on Vale. Other than it being Brazilian, and a large increase in debt (any reason why debt spiked?) this trade below looks pretty attractive. Thank you!

Buy 1000 VALE Shares to Open
17.00 x 2P-17.18 x 12P

Sell 10 VALE Jan-25 17 Call to Open
2.70 x 1-2.90 x 16

Sell 10 VALE Jan-25 15 Put to Open
2.22 x 50-2.58 x 50

That is Net $11.80, that entry price increases the yield to 11.8%, if you get called at 17 in 2 years, a 68% return with 23.7% in cumulative dividend payments….

And now the part of the analysis that AI can’t do…. Phils take…. Drum roll please…..

Like a weather report it may or it may not rain tomorrow

Now that is what I call a reply, thank God AI has not invaded the platform yet

simple checking wth yahoo finance VALE free cash flow has dropped from 21 at 20,000,000 to 6,000,000. Where are oll the flowers gone, wo sind sie geblieben???

Hurry you got it 👍 

Fits the Ukraine Just next door!!!

That’s more like it. Thank you!

Today’s 11.9% downside gap in the Natural Gas ETF ($UNG) was the largest since the ETF’s inception in 2007. BeSpoke

Good Morning.

oil at 80 dollars

YETI (a trader sold ) January $35 puts sold to open 700x at $4.10

AY looks interesting, though they have a ton of debt

thanks, kinda what I thought, but wanted to get your opinion.

CVS and VZ seem low in their channel. What are your thoughts about those companies and eventually what could be a good spread? Thanks

Book- your BotBuddy cautioned on bias- hard to avoid that if invoking Sanders/Warren style.
I posed the following question to my bot:
Would the writing style of elizabeth warren and bernie sanders be biased
Yes, the writing style of Elizabeth Warren and Bernie Sanders would likely be biased. Both politicians have very strong opinions on issues such as economic inequality, and their writing style tends to reflect these opinions. As such, their writing would likely be biased in favor of their particular political views.

Book- you asked for input so – your black hole premise would have to be data supported as it does not logically follow, in my view, that the billionaire hoards the interest income under the mattress. Rather, the income is redeployed as new capital in many different ways- start ups, government debt financing, donations, etc. Of course, this is all after the yacht, helo, vineyard, etc. are paid for.

Even without considering at all whether economic output or productivity would be enhanced or reduced if a very, very few trillionaires control all the wealth; it’s ridiculously easy to see that none of us want to live on an earth where 10 people own all things and make all the decisions. You have to be blind not to know that it would just suck.

Unless you jsut really love the idea of Saudi Arabia.

That gets us into the trickle down economics discussion which has already been disproven.

I think you got it backwards- its your book, your black hole premise so its up to you to convince me and others of the validity of the premise.
The capital gets stuffed or redeployed. One can plausibly argue disliking how it is done or having a better method- so make the case. Spare us the strawman politics and make your case.

i understood Phil to mean that colossal wealth accumulation will result in 10 (nice round number) people owning the ENTIRE EARTH. there is no strawman, or politics involved at that point. the result will be dictatorship, rule by king. the beautiful result that modern capitalism produced would be gone. just like there is an end point beyond the zero lower bound of interest rates that we cannot go beyond, there is also an endpoint in the amount of wealth accumulation that a capitalist democracy can survive. just as you can only raise taxes to so far before the system would implode, you are likewise limited in how far you can lower them.
so we can argue about the best level of rates, taxation, growth or inflation, but to argue there should exist capitalism without regulated limits is just silly.
unless of course it turns out that the final Trillionaire is me. then, I say it can ALL be mine.


Some thoughts re your book. Like the idea. I think a chapter on Adam Smith would be good.
1) Smith’s name and reputation would add some cache.
2) One of Smith’s main thesis is that capitalism is a great creator of wealth, but a poor distributor of wealth.
3) His book on the “Nature and Causes of the Wealth of Nations” was at its core a critique/diatribe of the English merchant class (businessmen) – specifically the abuse of money to purchase political influence, abuse of the legal system, rent seeking, creation of monopolies, etc.
4) He had extensive discussions on topics such as a) bankers cant be trusted b/c they create periodic financial crisis by making bad loans (eg. Lincoln Savings & Loan in the 1980, Subprime Mortgage Meltdown beginning in the 2007, etc,), b) progressive income taxes are needed because wealthy businessmen are the disproportionate beneficiaries of government services, (eg. legal system, police forces, military protection, physical infrastructure, educational system, etc.), c) businesses need extensive regulation (guilds, lobbyist, monopolies, oligopolies will skew free markets, bankers will make bad loans, etc.).

Adam Smith is so often misquoted and misrepresented as being a proponent of laissez-faire government regarding free markets, ie. anti taxes, anti regulation, etc. Instead he was a proponent of strict government regulation of business, bankers, merchants, etc. He was a proponent of progressive taxes to pay for services such as infrastructure, education, military, courts, etc. He was anti-guilds/lobbyist because politicians were/can be easily bought/influenced (Citizens United, carried interest, roll back/deregulation of Glass Steagall Act in the 1980s, unregulated derivatives, etc.). He was highly critical of monopolies and oligopolies that skewed free markets.

Just a thought.

Nice 1st Chapter on Adam Smith.


Re more factors and quotes, some thoughts.

Wealth of Nations is an extension of Smith’s first book, “Theory of Moral Sentiments”. There are some great quotes and thoughts re Capitalism in this book as well. Smith traces the evolution of society and its institutions thru 4 stages: the original “rude” state of hunters; a second stage of nomadic agriculture; a third stage of feudal, or manorial, “farming”; and a fourth and final stage of commercial interdependence. Each of these stages required a different form of civil government and regulations.

I think that bringing in Adam’s book on Moral Sentiments and the 4 stages of society would add some additional relevant background and weight to your ultimate arguments. It would allow you to discuss some of the “nuances” you refer to such as the conflict between government constrained enterprise and laissez-fair capitalism.

For instance: “Civil government,” he wrote, “so far as it is instituted for the security of property, is in reality instituted for the defence of the rich against the poor, or of those who have some property against those who have none at all.” Finally, Smith describes the evolution through feudalism into a stage of society requiring new institutions, such as market-determined rather than guild-determined wages and free rather than government-constrained enterprise. This later became known as laissez-faire capitalism; Smith called it the system of perfect liberty.

Among other references, see >>


I totally agree that a) progressive taxation especially on very high income b) inheritance tax and wealth tax on the super-rich are important. Question: Since the exorbitant accumulation of money started generations ago -if your thesis about the ‘black hole of wealth’ is correct as stated,- shouldn’t we have already had the disappearance of all money in the ‘black hole’???

Phil/Everyone —

Anyone here with TD in Canada, either using Webbroker or ThinkorSwim?

My SOFI spread order was rejected. I am being told SOFI is on TD’s restricted list, and no spreads can be bought for SOFI.

Anyone else had this problem?

Maybe International Brokers allow more latitude in Canada?

Oops, Interactive Brokers

Tyler Perry Expressed Interest in Buying Majority Stake of BET Media Group from Paramount Global — Sources — WSJ

also someone sells 2000 Jan2025 $22.50 puts in PARA for $4.70