Jim Cramer wrote a Sunday column linking Nvidia's stock movement to oil prices and Federal Reserve policy. That's three variables. Might as well throw in the moon phase and what Larry Fink had for breakfast.
The Fed doesn't set oil prices. OPEC does that when they feel like it, which is never when you need them to. Oil doesn't trade Nvidia shares. Nvidia makes graphics cards that crypto miners bought in 2021 and now use as doorstops. The connection between these three things exists only in the kind of narrative construction that requires ignoring how markets actually work.
Here's what happened Friday: sellers sold more than buyers bought. Stock went down. You can dress that up with macro analysis if you want to feel smart at dinner parties. You can say the Fed's hawkish pivot spooked energy markets which rotated out of growth names. You can say literally anything.
Technical analysts looked at a chart. Price broke support at $118. Volume spiked. That's the whole story. No oil required.
But retail traders love this stuff. They need a reason. They open their brokerage app, see red, and immediately search for someone to blame. Was it Powell? Was it crude? Was it Jim Cramer's Sunday column written after the close explaining what already happened? The answer is yes, definitely, it was the column. That's how time works now.
Nvidia closed Friday at $115.20. It opened Monday wherever it opened. The Fed will do what the Fed will do. Oil will go up or down based on whether producers want money more than they want to stick it to consumers. None of these people are coordinating. They don't have a group chat.
Cramer found a linkage. Good for him. I found a linkage between my neighbor's sprinkler schedule and the Nikkei. Doesn't mean I write about it every Sunday like it's the Zapruder film of stock movements.
Photo by Mariia Berezovsky on Unsplash
Leave a Comment