Equity futures are strong this morning, up from a low of Nasdaqs +55 bps to up +109 bps on the Russell2000. Other futures markets are quiet, but Bitcoin is down -1% and flirting with the $29,000 support level. The price action of the last few days is encouraging, but the trends of the last few months are still in motion - this morning tech stocks and speculative crypto are underperforming. In a disturbing turn of events, Ether, Avalanche and Solana are down big in Thursday morning action despite the relative calm in Bitcoin:

Bitcoin put/call ratios have risen significantly, signalling fear in the market. Implied vol on crypto is also rising - expect huge moves in crypto over the next few months. Maybe the most scary thing in crypto are the acting Comptroller of the Currency Michael Hsu's comments about potential regulation - that can't be good for Tether, as its price limit is the current $1 on the upside and almost a total loss on the downside if regulation were to uncover a lack of reserves.

This morning, the UK is indicating a temporary windfall tax on oil & gas profits (Hungary was the first country to do so). Ignoring politics, anything that impedes additional supply of fossil fuels is inflationary, so this UK windfall energy tax is not good news on the inflation front.

Alibaba sales were up 9%, which was better than expected, and the stock is up a healthy 4% in premarket action. Other pre-market action confirms the recent 3 steps backward one step forward action, as miss-related price declines are exceeding beat-related price rises: SNOW is down -14%, NVDA is down -6%, and NTNX (a cloud platform company) is down -34%. Strong results came in from WSM up +9% on strong sales to affluent consumers and LULU is up 2% after a Morgan Stanley upgrade. Once again, not all the news is bad (even Macys' had good news!), but the trend of over-valued tech underperforming continues. Next week we will be writing a piece for subscribers that will estimate a likely bottom in tech - for some companies like CVNA, it could be a long downward trend, but for other companies like GOOGL, we are likely near the bottom.

Yesterday's volatile conference call with Dick's Sporting Goods showed how manic the market really is. The company brought down guidance just to be conservative, but there were actually no signs of slowdown in the actual business. Shares dropped -11%, only to rise as high as +14% when executives, after repeated questioning, reiterated that the lower guidance was just to be conservative and that there was no slowdown yet. The combination of uncertainty and lack of liquidity shows how much valuation can change and it also shows how quickly valuation can change. Negative -11% to Positive +14% in a half hour is a massive swing.

The advance/decline line is indicating relative calm in the general indices but no signs of basing in the tech-heavy NASDAQ:

Check out our recent comments on the SPX & VTI. Thanks for reading.