A lot has happened on Nov 17.
Queen Elizabeth took the throne in 1558. Napoleon beat the Austrians outside Venice (and declared Piazza San Marco the “world’s most beautiful drawing room”) in 1796. On this date in 1855, David Livingstone saw Victoria Falls.

Illustration 114575762 / Napoleon Bonaparte © Boldurevaol | Dreamstime.com
General Ambrose Burnside on Nov 17 set out for Fredericksburg and a December 1862 battle costing the Union 12,500 casualties. A year later on this date, President Lincoln began drafting the Gettysburg Address.
On Nov 17, 1917, Lenin instituted a “temporary” end to the freedom of the press. In 1922, on Nov 17, the Ottoman Empire ended. The same day in 1928, Boston Garden opened, and Notre Dame lost a home game for the first time in 23 years.
You get the point. Every day counts.
Today, VIX options reset and Broad Market Sentiment peaks – or so the math suggests. I don’t expect it’ll be more than just another November expirations period lasting three days, followed by a weekend, and then new options trading next Monday.
But you never know what momentous event is waiting for us tomorrow. I see Goldman Sachs expects the S&P 500 to reach 5,100 next year, up 9% from now. It’s been a long time since we’ve talked about our expectations for the market. And Goldman Sachs took the pressure off for everybody.
So, what do we expect? Every day counts. Broad Sentiment, our 10-point meter for supply and demand, tells us when the four big reasons for buying and selling wax and wane. Traders and investors aren’t all doing the same thing. They’re buying Story, Characteristics, Price, and Association with a Derivative.
And derivatives are expiring. The PROBABILITY in the near-term is that Derivatives and Prices will trump the other two purposes. As to direction, a rising market tends to breed bull bets into expirations.
Which can mean bull bets end when new options trade. I can’t say for sure. But that’s the central tendency and has been for the whole time we’ve measured data, back to the advent of Regulation National Market System in 2007, the math from which makes possible observing discrete behaviors.
I thought you were going Big Picture, Tim.
We don’t predict what the market will do – at least accurately – more than five days out. Price is the single biggest motivation in the stock market. Take WMT, which reported great results yesterday, and fell.
Why? Because 9% of WMT trading volume is focused on Story. The remaining 91% coalesces around the other three, including 63% on Price or Derivatives. Not results.
Every public company should know that. If you can, why wouldn’t you? It’s math.
Now, broadly, my expectation is that sooner or later a stock market stuffed with derivatives and transitory prices will descend into smoking ruin. But probably not tomorrow.
It’s also my expectation that the embrace of the ethereal – cryptocurrencies, dollars you manufacture like Happy Meals, NFTs, social tokens, the metaverse, ETFs, options, on it goes – is a sign people have lost touch with reality.
That generally doesn’t work out either.
So, we have to make each day count. Public companies, spending all your time and dollars on Story when the market isn’t is confusing busy with productive – and leaving a lot of value for your executive team and Board lying on the table.
You have a chance to change the IR profession, you folks doing it now. That reminds me, I’m in Boston Thursday for a trading panel. The moderator, a longtime quant sellside strategist, said 75% of the buyside uses alt data now — stuff well beyond the story you tell, the financial data you supply.
They’ve moved on.
We can keep doing what we always have while the world changes around us. Or adapt. You choose. Two trees. Obscure theological reference.
And traders, if 91% of the money is doing something else besides studying financial performance, the central tendency is that something besides financial performance will determine outcomes. I give you meme stocks, for instance. Supply and demand create them. Not Story.
(Editorial note: Traders, try Market Structure EDGE, winner for 2021 Best Day Trading Software at the Benzinga Global Fintech Awards last week).
To wrap, I’ll say this. Inflation boosts asset prices but is always followed by Deflation. This is a physical fact like Cause, and Effect. The unknown, the element of uncertainty in the equation, is the gap between them.
So. If you can measure supply and demand, do it. If you can measure behaviors, do it. You reduce the risk of being caught unaware. In short, make every day count.