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Inflation and Market Overreaction

By Andrew Aziz  |  
Andrew's Newsletter  |  
Feb 10, 2022

Dear Traders,

Happy inflation report day! At 8:30am ET, the CPI numbers came out and they were 9.2% more than anticipated, like 0.2%. Reaction was quick in the premarket, with a sharp drop of over 2%, but as I write these words, the recovery seems to be equally quick at the Open, with all the indexes gaining back most of their losses from the premarket. Brian and I executed amazing opening trades on the QQQ index (which represents technology companies) by going long $TQQQ. We both made very nice and decent profits! You can watch our recap here.

The following are 2 crucial numbers from today’s report that you should be aware of:

Wage growth +5.7% YOY
Inflation +7.5% YOY

To translate into practical terms, if your annual pay raise was less than 7.5%, you actually got a pay cut.

Thursdays at Bear Bull Traders are dedicated to mentorship. I am heading into my mentorship session at 11am ET, Ed will be holding his session at 4:30pm ET (with 30 minutes of afterhours trading commencing at 4pm ET), and Thor will be helping our Elite traders at 8pm ET with a special focus on how to trade based on Volume Price Analysis (VPA).

Don’t forget, our mentorship sessions are exclusively for Elite members, and so if you have not already, please ensure you upgrade your plan by taking advantage of our Valentine’s Sale. You will receive 50% off of an Elite annual membership and that membership level will entitle you to 1 year of full access to everything Bear Bull Traders offers. You can check out the details here.

To your success,
Andrew

PS: No matter where you are on the learning curve of trading, there is truth in the adage that practice makes perfect. I thus urge you to make good use of our free Market Replay tool. It is available when you are, 24/7. You will find it at stocktradingsimulator.com