Market analysis for Feb 14th, 2024

Happy Valentines day! Fortunately my wife thinks this is a made up holiday so there's not much pressure on me!
Yesterday was a solid day for us. We had three "normal" 0DTE's hit for profits and our Event contract 0DTE hit for a 12% Return. I'll say it again, if you are not trading event contracts, you're missing out on a tremendous product to help create "edge" in your trading results. 

Our scalping also kicking in about $1,700 of profit on the day. I'll give you another push on it as well. We are on track for $50,000 of income this year, scalping twice a week with $5,000 of capital. 

We said yesterday morning the CPI can and does have as big an effect on the markets as FOMC. That was certainly the case yesterday. CPI came in hot...it took the diminishing chance of a March rate cut right off the table. We are playing this with an event contract which pays 10% Return if we get NO rate cut. It's already up 7% now, after the hot CPI. 
The DOW posted its biggest one day percentage drop in nearly 11 months. We put earnings trades on ABNB, HOOD, LYFT, MGM, UPST, Z and they ALL look set to take profit on this morning.
Earnings continue today with CSCO, OXY, TWLO on our radar for potential setups.
We will also  be working our MSTR  and Oil positions today as well as our normal 0DTE's 

“While the door for a March cut had already been effectively shut given the recent Fed commentary and the jobs reports, the Fed has now locked the door and lost the key,” said Greg Wilensky at Janus Henderson Investors.

Meanwhile, U.S. rate futures have priced in an 8.5% chance of a 25 basis point rate cut at the March FOMC meeting and a 38.7% probability of a 25 basis point rate cut at the May FOMC meeting.

Pre-Market U.S. Stock Movers
Upstart Holdings Inc (UPST) tumbled over -19% in pre-market trading after the company issued weaker-than-expected Q1 revenue guidance.
Robinhood Markets Inc (HOOD) climbed more than +13% in pre-market trading after the company posted upbeat Q4 results.
LYFT Inc (LYFT) soared over +17% in pre-market trading after the ride-hailing firm topped quarterly profit estimates and said it would generate positive free cash flow for the first time in 2024.
Airbnb Inc (ABNB) slumped more than -5% in pre-market trading despite reporting Q4 revenue that surpassed expectations and issuing strong Q1 revenue guidance.
HP Inc (HPQ) rose about +1% in pre-market trading after HSBC upgraded the stock to Buy from Hold with a price target of $33.
Citigroup Inc (C) gained over +1% in pre-market trading after Piper Sandler upgraded the stock to Overweight from Neutral with a price target of $63.

Our main news catalyst for today will be Oil inventory:
Wednesday 14th February
10:30 ET
US Weekly EIA Crude Oil Inventories
The US Weekly Energy Information Administration Crude Oil Inventories report provides information on the total stockpile of crude oil in the United States.
It includes data on the changes in crude oil inventories, indicating whether there has been an increase or decrease in the amount of oil held in storage.
This report is crucial for assessing supply and demand dynamics in the oil market and can influence oil prices.
What to Expect
A significant buildup in inventories may indicate oversupply, putting downward pressure on prices, while a decline may suggest increased demand, potentially impacting prices in the opposite direction.

For just a second, we got a technical sell signal in the market. That's moved back to the dreaded neutral zone today.

The question now is: #1. Is this a "buy the dip" opportunity or #2. Is this the start of a change of directional bias. My lean is the former. We have a long, rolled SPX setup we'll continue to work today that could be a $5,000 payoff if I'm right.

One good thing about yesterdays selloff is that the 'extreme greed" bubble has popped. We are now just stuck in "greed". Still a lot of "risk on" going on here:

For the week, Real estate continues to get beaten up the most with it's interest rate sensitivity. 

We also continue to get divergences with more and more stocks dropping below their 50-200 DMA respectively 

Fibonacci lines tell the story of yesterday and this mornings price action 

Intra day levels for me:
/ES: 4986 (bulls must hold this level)/5017/5021/5038 to the upside. 4986 (bears need to push below)/4967/4936/4921 to the downside.
/NQ:  17766 (bulls must hold this)/ 17900/17995/18125 to the upside. 17766 (bears need to break this) /17681/17597/17539 to the downside.