Market When Closed, Tuesday 29 October
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And So It Begins
by Alex King, CEO, Cestrian Capital Research, Inc
Today marks the start of another Big Tech earnings season dubbed "the most important in 10 years / 20 years / a generation / etc". Nothing like a little psychodrama to make a very boring event seem exciting. Google and AMD printed today after the close; Google is up nicely and AMD is down some. You can read our AMD earnings analysis note here.
Next up we have Meta Platforms, Microsoft, Amazon and so forth; the reaction to these prints will determine the short-term direction of markets. The Nasdaq in $QQQ form finally cracked $500 today for the first time in more than three and a half months; the Nasdaq has lagged the S&P500 and the Dow Jones for some months now; if the response to Big Tech earnings is good, perhaps we see leadership passed back to the Nasdaq.
Before we turn to our market overview of equities, bonds, oil, volatility and sector ETFs - I want to talk about our new SignalFlow AI service.
Two days remain if you want to sign up for SignalFlow AIat launch pricing levels.
All Signal, No Noise
A couple weeks back we launched our latest service, SignalFlow AI. I confess to being blown away by the instant-hit status of this service. Usually with subscription services it takes a while to grow an initial membership, then another while to build up a flow of new members and so on. But SignalFlow AI has been a big hit right out of the gate. I’m delighted, but I’m not completely surprised. Let me explain.
The service uses a complex AI model to try to predict when the S&P500, or whichever major liquid market or stock it is asked to compute, is likely to enter a material downturn. There is a lot of heat and light generated in doing so. But that all happens in the datacenter. The output of the model is as simple as simple can be. Twice per trading day, in the morning and the afternoon, the service publishes a signal from the model.
“1 - Risk On” means that the model thinks that no material downturn is imminent.
“0 - Risk Off” means that the model thinks a material downturn is imminent.
No model is infallible as you know. And there are always things that happen in the future that are different from the past that may trip up any model. It is possible that this model is perfect, but not probable. But trading perfection isn’t why so many people have subscribed already.
The reason is simple. It’s the reason I myself have opened and run a specific account that trades solely on the SignalFlow AI model outputs. It’s that the service gets you a Robot Buddy. A robot that has no fear or greed. A robot that isn’t trying to feed you false information so it can trade against you. A robot that isn’t trying to make you look good (so you promote it) or bad (so it gets your job and/or bonus). You just have the robot taking everything it has learned about how major securities markets move, and then considering in that light whether markets are about to turn down or not. However dead-inside you run (and I speak as someone who never gets very excited about markets, whether they are melting up or breaking down), you don’t run as cool as a machine. Your robot sidekick doesn’t care about whether you’re having a good run or a bad run, and it isn’t having its senses overwhelmed by the news, CNBC, FinTwit, your boss, your top analyst, or anyone else. It’s just looking at the numbers. This is a very useful sidekick indeed.
The backtesting results are remarkable, as you can see here. I know full well that backtesting is backtesting, it’s not future-testing. But it’s so good that it gives me great confidence in the model thus far - enough to run capital solely on the model’s outputs.
Today the service is very low cost and provides signal for $SPY alone. We will add additional tickers over time, at incremental cost.
If you’d like to lock in launch pricing - prices rise 1 November - you can do so right here: