Afternoon Notes – 3/9/2022

Good Afternoon:

• The Russia/Ukraine war rages on as the Biden Regime attempted to explain away the BioLabs that “didn’t exist” in Ukraine.
• The White House recently deleted archived videos of President Obama at the BioWeapons facilities in Ukraine that the White House tried to deny existed until Victoria Nuland spilled the beans yesterday.
• Meanwhile, President Clinton is resurrecting the Clinton Global Initiative. Either there must be a new grift operation ready to gear up with Ukraine aid from the U.S. Government, or Hillary must be preparing to throw her hat back in the ring for 2024. Maybe it’s both.
• Clinton Cash by Peter Schweizer nailed the previous Clinton pay-for-play schemes.
• “Ukraine crisis is bad, but ‘wait until you see’ flood of climate refugees,” Frozen Botox Face and Climate Czar John Kerry today as he stepped off his Lear Jet. The headlines write themselves.
• Anyway, attention will now briefly revert to the inflation numbers coming out tomorrow morning. The numbers won’t include the explosion in commodities prices over the past week, but the last wholesale numbers were 10%. Either that boosts consumer prices commensurately, or earnings will shrink. You cannot have it both ways.
• As predicted, the stock market produced a good relief rally ahead of the report. The market opened at 4249, the first resistance announced in today’s Morning Notes, then briefly rallied just under the second resistance at 4300 before crowning a bit into the close.
• Today, commodities (including wheat and oil) took a well-deserved hiatus on some profit-taking. 
• It looked like the stock market action reflected some profit-taking and cautionary repositioning ahead of the CPI report.
• While I saw some encouraging behavior in the S&P 500 yesterday, today, there was considerable shorting again around 4300, and it far exceeded any call buying.
• I guess that on today’s gap higher, participants with a longer time horizon saw the move as an opportunity to sell/short at better prices; aggressive put buying and call selling persisted all day.
• The market remains stuck in a high volatility box between 4100 and 4300.
• No doubt, tomorrow’s report will be the catalyst to break the top of the range or retest the bottom.
• But even with another rally day, there is a brick wall at 4400 that is unlikely to break until we get clarity from the Fed, and we pass through monthly expiration after that.
• I would not be surprised to see the market pin around 4400 into monthly expiration.
• Given participants’ put-heavy, negative-delta positioning, counterparties are pressuring underlying products through their hedging activities.
• The market remains oversold and poised to deliver further gains if it can climb the wall of worry.
• The WEM low remains strong support at 4200, and the Put/Wall at 4000 would also take the wind out of further declines.
• My best judgment is that the market wants to go up the wedge before going down again. Tomorrow promises to be interesting!

A.F. Thornton