Portfolio 2 Trade Alert & Market Intelligence
Today we did the opposite of yesterday's bullish roll — we took a winner off the table
Market Intelligence
The big picture: the market is drifting higher and calm on the surface, but everyone’s really just waiting for tomorrow night. Alphabet and Tesla both report Wednesday after the close — the first real test of the AI trade after last week’s chip scare — and the Fed decides next Tuesday–Wednesday (7/28–29) right behind them. Volatility is cheap, which means fear is on sale, but there’s not much cushion if the earnings disappoint. A week to stay patient and let the calendar play out.
Live scanner (midday ET): SPY $746.88 · QQQ $706.14 · GLD $373.34 (gold ~$4,032/oz) · /MES 7,527.
Volatility — cheap, cuts both ways. The VIX (the market’s “fear gauge”) is in the mid-17s, below its long-run average near 20. Low fear means protection is inexpensive to own, but there’s thin premium to sell. When the VIX is this low, you’re not paid much to take risk — small size and patience win.
Rates & the Fed — a hold, but a grumpy one. The Fed is parked at 3.50–3.75% and almost certain to hold next week. The catch: it’s a hawkish hold — half the committee now pencils in a rate hike later this year, not a cut. The 10-year yield sits near 4.57%. Don’t expect the Fed to rescue stocks.
Stocks & breadth — higher, but narrow. The market recovered from last week’s chip wobble, QQQ back above 706 with large-cap tech leading again. The catch is thin leadership — a few big names doing the work while the average stock lags. Earnings so far are strong, which is the real fuel.
Other markets — quiet, with oil waking up. Dollar soft, bonds and credit calm (no stress), gold firm near $4,032 as a safe haven. The mover to watch is oil — WTI is turning higher. Rising oil is double-edged: good for energy, but it can reignite the inflation worry the Fed is already fighting.
This week — all about earnings. Alphabet and Tesla Wednesday after the close are the marquee event (watch Alphabet’s cloud + AI-spend numbers); Intel Thursday. Little economic data until next week, and the Fed goes quiet before its decision. The big moves come from company results, not headlines.
Sentiment — nervous, but not hedged. The Fear & Greed gauge still leans “Fear,” yet investors aren’t buying much protection. People feel worried but haven’t acted worried — that gap usually means the selloff hasn’t fully cleared, and hedges are still cheap to put on before everyone piles in.
What the pros are saying (updated today, July 21):
Liz Ann Sonders (Schwab) — today’s data was two-sided. Good: the Philly Fed services survey jumped to +7.4 from −25.8, new orders and hiring flipping positive. Worrying: a fourth straight week of slower private hiring, credit-card applications at their highest since October 2021 (households stretching), and her “Rule of 20” still flags the market as expensive. Message: rebalance, pick your spots.
Charlie Bilello (Creative Planning) — full valuation-hawk. He flagged IBM’s −25% one-day drop last week as a “15-sigma event” (statistically it should basically never happen) — a warning about how brutally the market punishes a priced-for-perfection stock that stumbles. And Apple now trades at 40x earnings / 11x sales, the richest in its history. Tread carefully in the mega-caps.
Keith McCullough (Hedgeye) — a notable pivot today: “Did Quad 4 just end?” His signals now point to “Quad 3” — growth slows but inflation firms back up — and he turned bullish on oil (”WTI goes bullish trade and trend”). A shift from pure defense last week toward owning energy and commodities.
Danielle DiMartino Booth (QI Research) — still cautious, fresh evidence: new homes are now selling for less than existing homes (builders cutting prices first), and she argues real affordability only returns “the hard way,” when the economy weakens enough to force rates down. Keeps flagging the low unemployment rate as partly a mirage.
Bottom line: cheap volatility, a narrow market, and a stacked calendar (Alphabet/Tesla tomorrow night, the Fed next week) add up to a simple posture — collect premium selectively and in small size, keep everything defined-risk, and put cheap hedges on before the big events, not after. The pros are split (McCullough leaning into oil/reflation; Sonders and Bilello pointing at stretched valuations), which is exactly why we’d rather manage risk and probabilities than make one big bet. Not a recommendation — just how we’re reading it.
The Trades
🔒 The specific position and Greeks below are for Grow Your Pile members.
