Happy Sunday - hope everyone is having a good weekend and some healthy time away from the screens to recover from late Friday’s action. So what caused the big sell off starting mid-morning in consensus names/semis? The simplest and likeliest explanation to us was passed along by a reader, calling out intraday BTC weakness which led to QQQ/NVDA weakness and triggered a whole lot of negative gamma. Bc of the neg gamma, stocks recovered, but BTC (which has no gamma issues), recovered just fine (and is making new highs over the weekend.)
To us, this seems plausible as BTC/NVDA are now linked as two barometers of risk-on and the QQQs and BTC have been closely correlated over the last several years.
Still, we respect price here at TMTB and know that — especially with stocks extended — price begets price at times, so it wouldn’t surprise us to see some further weakness on Monday. The QQQs closed just below $440 and below the 9d, our favorite gauge for very short-term trend. In addition, lo…
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