Market On Open, Monday 2 February
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The New Normal
by Alex King, CEO, Cestrian Capital Research, Inc.
I think that 2026 is going to be quite hard work in markets. I also think there is a lot of money to be made from the hard work. I think that everyone’s favorite layup, the Mag7, are at a crossroads where some will prove to be efficient capital allocators and some will not (remember they have until recently all been fountains of free cashflow, so this endless capex thing is a new business for them). I think the volatility in commodities will wreck tourists at the same time as enriching true believers, and I think Bitcoin and Ether are going to do something similar. As I say, not easy. The backdrop is a new Federal Reserve Chair whom we should all assume will be more dovish than Powell, but who is currently being portrayed as the opposite; this too is playing havoc short-term with multiple asset classes.
I know of only one way to handle this or any other market environment which to have no belief, no opinion, to respect only two factors, being price and volume. We do this every day in this Market On Open note - you can find all the back issues here - and even more of it in our real-time Inner Circle environment.
Today’s issue of Market On Open is available to our new “Cestrian Circle” members too. Cestrian Circle members receive two of our investment notes per week - market review notes, earnings notes, whatever is most pertinent. If you’re a free reader of our work, try it out - it’s an extremely low cost way to access some of our best work.
Alex King
So let’s now put all our preconceived notions about market direction aside and get to work!