🧪 All Time Highs

Good Morning!

This week, the S&P 500 briefly hit an all-time high, fueled by relentless AI hype. Nvidia led the charge, shattering records post-split, but is this surge sustainable or a bubble ready to burst? Meanwhile, Bitcoin took a dive as whale activity spooked the market.

Sherlock’s spotlight is on a daring short play on Binance Coin (BNB). Armed with pattern failure theory and sharp analytics, this trade promises high stakes and potentially high rewards.

Let’s get into it 👇

🌡 Market Temperature Check

📈 S&P 500 Briefly Tops 5,500 for First Time as AI Hype Hits Fever Pitch

🤔 Microsoft on top, Boeing's deal, UK public debt - what's moving markets

🐳 Bitcoin whales blamed as BTC price slips 2.8% after nearing $66.5K

▶ How To Start Trading Crypto As A Complete Beginner

📰 What’s Happening Today?

Nvidia Pushes Markets to New Heights – But Can It Sustain It?

Guess what? The S&P 500 had a major moment on Thursday, briefly cruising past 5,500 points for the first time ever! Thanks to the AI buzz, investors were all in. The main player here? It's Nvidia again, stealing the show with its historic rally.

• Nvidia shares hit an intraday record of over $140 following a cool 10-for-1 stock split.

• This marked the 31st record high for the S&P 500 this year, even though it dipped a bit by the end of the day.

• The Nasdaq Composite also took a bit of a breather, ending a seven-day record streak.

A Reality Check

Hold up, though. Despite all the hype, there's some chatter about how this rally is pretty much riding on the backs of a few tech giants like Nvidia.

• Jobless claims for the week came in at 238,000, a tad higher than expected but lower than the previous week's 243,000. This got everyone rushing to the US dollar, adding a bit of a twist to the tale.

• The decline from the previous week brought the four-week moving average to 232,750.

Double-Edged Sword?

Nvidia's stock is on fire, thanks to the booming demand for its AI-driven graphics processing units. But with a whopping $3.3 trillion valuation, there are some raised eyebrows about whether it can keep up this pace.

• Nvidia has now overtaken tech titans Microsoft and Apple in market value.

• With a 10% rally over the last five trading days, Nvidia is definitely the star of the show, but don't forget about the risks that come with such a high valuation.

So, what's next? Keep an eye on the economic indicators, especially the Federal Reserve’s preferred inflation gauge (PCE). While the AI excitement is real, it's smart to stay alert to the broader economic signals that could steer the market.

📈 What I’m Trading

Sherlock’s $BNB Short

The Play

Sherlock's short play on Binance Coin (BNB) is one for the books. Utilizing classic pattern failure theory and a deviation move above a key level, Sherlock sees this as a prime opportunity. The 4H timeframe already offered a retest of the trendline yesterday, which was a solid entry point, but another retest around the $616 level is still on the table. This setup on the daily chart suggests patience is key, as this trade will unfold over time.

Entries:

• $584

• $616

• $650

Stoploss:

• 4H Close above $670

The Catalyst

Recent findings from Gray Wolf Analytics and a financial outlet revealed that 80 million BNB tokens were initially allocated to the Binance founding team. Shockingly, the company still controls 46 million of those original tokens. This heavy concentration of tokens in the hands of the founding team raises concerns about potential market manipulation and the long-term stability of BNB's value.

As these revelations surface, the market is likely to react, making Sherlock's short play even more compelling.

Our Take

This short on BNB is a calculated move backed by solid technical analysis and recent market insights. With a significant portion of BNB still controlled by the Binance team, the potential for price drops looms large. Sherlock's strategy leverages a failed pattern and deviation move, setting up a high-probability trade.

While the targets are to be determined, the entry and stoploss levels are clear, providing a structured approach to managing risk.

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✍ TL;DR

Nvidia Story

• S&P 500 Milestone: Briefly topped 5,500 points, driven by AI excitement.

• Nvidia's Role: Major contributor to the rally with a historic stock surge.

• Stock Split: Nvidia shares soared post a 10-for-1 split, hitting a record high.

• Market Concerns: Rally largely fueled by a few tech giants like Nvidia.

• Economic Indicators: Jobless claims higher than expected, adding market uncertainty.

• Nvidia's Valuation: Now worth $3.3 trillion, surpassing Microsoft and Apple, raising sustainability questions.

• Key Watch: Federal Reserve’s inflation gauge (PCE) for future market direction.

BNB Short

• Headline: Sherlock's short play on Binance Coin (BNB).

• Strategy: Utilizes pattern failure theory and deviation move above key level.

• Entry Points: $584, $616, $650.

• Stoploss: 4H close above $670.

• Catalyst: 80 million BNB tokens initially with Binance team; 46 million still controlled by them.

• Market Reaction: Potential market manipulation concerns affecting BNB's long-term stability.

Stay ahead, stay informed, and most importantly, stay profitable.

‘til next time,

TradingLab