Review of US Stock Market Performance on March 12

US stocks suffered another day from a crude oil shock! 🤯

Crude Oil
Rose another 9%, with Brent crude oil futures closing above $100 for the first time in over three years.

S&P
Market panic intensified, with the S&P and Nasdaq opening lower and falling further, showing no signs of resistance during the session!
The S&P fell below 6700, hitting a new closing low in nearly three months. I posted a reminder during the session that this trend is not good.
The next step is to see if MA200 at 6600 can hold. If not, the market turns bearish! ❗️

Regarding Interest Rate Cuts
From betting on two rate cuts this year at the beginning of the year, the market, influenced by inflation today, has already started betting on no rate cuts for the entire year.

Negative news keeps coming, where is the reversal?
Only when the US-Iran war eases, the Strait of Hormuz opens, and oil prices plummet, will the S&P reverse and return to 7000 points.
If there are any military experts, feel free to predict the war's direction. I don't understand this area.

My Positions
On Monday and Tuesday this week, I cleared my positions in AVGO and COST respectively.
The S&P is down 3% this month, but my account has barely moved. My position allocation is fine for now.
I still have close to 40% in cash, waiting for a drop to add to my positions. 💪

Financial Sector
Performance has been very poor recently!
Private credit funds are already facing an unprecedented wave of investor redemptions and a large number of borrower defaults.
Including Morgan Stanley, which has also started limiting redemptions for one of its private credit funds.
Credit defaults + rising inflation mean the short-term risk for financial stocks is very high. Be cautious about bottom-fishing.

Aviation Sector
Closely linked to oil prices. High oil prices lead to plummeting profits, and aviation stocks have fallen sharply.
However, once oil prices drop, this sector presents an opportunity. 🧐