EOY is a great time to zoom out, reflect, and adjust. And after a great 2022 and equally bad 2023, I’m spending the end of this year consolidating the process learnings from the last two years in order to best position myself for what is likely to be an even more volatile and chaotic 2024-2025.
One of the best process enhancements this year has been the addition of The CASP, as it acts as an excellent framework for digesting short-term cross-asset market action. The way I have used it to-date is to grade each component based on how it acted on that particular trading day, but what I have found is that it is the accumulation of daily observations over a 1-2 week period that is most helpful for tactical positioning purposes.
So, rather than grade each component on a daily basis, I will provide daily commentary on each component (both on that day’s action and the 1-2 week trend) and then provide a tactical outlook for SPX that serves to amalgamate the component parts into an actionable outlook conclusion.
The CASP is run principally through the private Xwitter account, so for those who have followed along I have made a couple adjustments to the components in the last couple of weeks. I initially removed “FICC” and replaced it with “Market Character” and “Flows Windows”, as I was having a difficult time grading FICC…but as I started to use The CASP since the changes were made I was finding myself wanting to comment on FICC. Likewise, the Flows Windows component is really critical, but doesn’t lend itself to daily commentary.
Long tortured story short, by adding back FICC and zooming out in my daily CASP commentary, I now have a better ability to get out of the daily weeds and see where the puck is likely headed from all key tactical angles.
In other WOTE news, I am currently working on the SPX Market Outlook and The WOTE Report, which should be out in the next couple of weeks.
As I am adding new components to The WOTE - such as the SPX Sector Report, The Cyclical CASP, and WOTE Asset Management - I am making the initial pieces free as a preview, but everything will soon go back behind the paywall.
The SPX Market Outlook will remain public both on The WOTE and Xwitter.
Happy Thanksgiving!