sport football: Another Day, Another "Selloff"

Rabu, 16 April 2025

Another Day, Another "Selloff"

Take Me to TheoLive: Market Masters

Dear Fellow Trader:

Have you noticed the pattern lately?

A nice little market pop in the premarket hours… only for the market to sell off?

I would love to tell you it's a coincidence. But it's really how the markets work these days, especially in low liquidity conditions. The premarket environment offers unique advantages to great big funds.

When we see just 10% to 15% of normal trading volume before 9:30 am ET, even modest orders can move prices significantly. This is also a period when hedge funds and trading desks are fully operational with minimal counterbalancing forces.

Finally, activity in index futures has an outsized impact during these hours, with price movements amplified across the broader market. I'm alway reminded of the 2006 interview by Jim Cramer - a long-time hedge fund manager at TheStreet.com.

In it he talked about the following:

Strategic Order Flow: As Jim Cramer once revealed from his hedge fund days, they can place a series of incrementally higher bids to "drive the futures" and create perceived momentum.
Morning Narrative Setting: By appearing on financial news shows or providing commentary, they can shape the day's market narrative before most investors are even awake.
Thin Market Positioning: Building significant positions during low liquidity hours costs less than accumulating the same size during regular trading.

After the market opens… regular trading starts and things shift. As the market floods with retail participants and algorithms, funds gain access to deeper liquidity to distribute positions without moving prices against themselves.

What looks like a bearish reversal is often simply the unwinding of successful premarket positioning. And without artificial buying pressure, prices naturally drift toward levels that reflect actual supply and demand.

In this environment, we have to be careful. When you see the futures lighting up in the morning (especially when our momenum readings are Red) remember Cramer's infamous quote: "Who cares about the fundamentals? The great thing about the market is that it has nothing to do with the actual stocks."

In this environment… that couldn't be more true…

What's On Tap?

We have a great show for you today. The headline today?

NVIDIA (NVDA).

Shares are off 6.4% in premarket hours after the company announced a $5.5 billion charge. The company is right in the crosshairs of the trade war between the United States and China.

This is a big deal to the stock market because of NVIDIA's huge weight in the market.

But… it is just a smaller actor in the BIG STORY today - the secret that no one is telling you about how the global trade system works. I'll reveal it… and what it means…

At 8:45 ET. Join me here.

Tune In, Tune Up

No shocker here. We're only seeing two U.S. stocks in real breakout territory right now - Palantir (PLTR) and Netflix (NFLX). Blake laid out a brilliant trade yesterday trading PLTR - adding that investors could have secured a nice gain just using what the market gives us with puts.

Blake will be joining me Thursday at 2PM ET for a special live event where we dig deeper into that exact approach—and how he's managed to stay positive while the rest of the market crumbles. Click here to join us.

Also this morning, I'll discuss stocks breaking down, stocks above their 20-day, and where money is flowing in the early hours.

We're Talking Oil!

What's going on in the energy sector? Why are oil production stocks getting hit?

I'll walk you through it… and show you exactly how and when to trade it as commodity traders continue to short the sector. It's going to be a tough year… and this is one of the biggest narrative rug pulls we've seen in a long time. I'll walk you through it.

It's all live… and it all starts in 30 minutes. See you there.

Stay positive,

Garrett Baldwin