Tesla

  • TSLA stock is up 3% to $670 in Tuesday's premarket.
  • Musk announces plan to cut 3% to 3.5% of total headcount.
  • Tesla being sued for recent mass layoffs in US.

Tesla (TSLA) CEO Elon Musk announced at the Qatar Economic Forum on Tuesday morning that his market-leading EV manufacturer was planning to lay off as much as 3.5% of its workforce immediately, including 10% of salaried workers. This is actually a reduction in scope by Musk, who said earlier in June that he had a "super bad feeling" about the economy not long after JPMorgan CEO Jamie Dimon said a "hurricane" was on its way toward the US economy. At that time an internal memo from Musk called for a 10% reduction in headcount. TSLA stock is up 3% to $670 in Tuesday's premarket on the news.

Tesla Stock News: Layoffs appear short-lived

At the Qatar forum in an interview with Bloomberg's News' Editor-in-Chief John Micklethwait, Elon Musk said the 10% of job cuts were meant only for salaried workers, as opposed to hourly manufa

Tech Leads Market Declines on a Down Wednesday

Tech Leads Market Declines on a Down Wednesday

Finance Press Release Finance Press Release 10.12.2020 17:22
After the market rose to intraday highs on Wednesday (Dec 9), the indices pulled back and closed in the red - largely led by the tech sector.News RecapThe Dow closed 105 points lower for a loss of 0.35%, the S&P 500 fell 0.8%, and the Nasdaq dropped 1.9% for its worst day since Oct. 30. The tech-heavy index also snapped a four-day winning streak. The small-cap Russell 2000 also fell by 0.82%.Wednesday was a resumption of the rotation out of tech that we saw in early November. Tech led the declines, and in particular, chip stocks such as Lam Research (LRCX) which fell by nearly 3.5%.Other big 2020 winners fell sharply on Wednesday as well such as Tesla (TSLA) which fell nearly 7% and Netflix (NFLX) which fell 3.72%.Stocks reversed downwards after Senate Majority Leader Mitch McConnell told Politico that Republicans and Democrats were “still looking for a way forward” on stimulus negotiations.COVID-19 continues to worsen in the U.S, but Tuesday’s rollout of Pfizer’s vaccine in the U.K., has spurred optimism. However, there are some concerns about people with a history of allergic reactions receiving the vaccine.Meanwhile, the Food and Drug Administration (FDA) may be just days away from approving Pfizer’s vaccine.COVID-19 continues surging to uncontrolled and grim levels. For the first time since the start of the pandemic, the U.S. hit 3,000 deaths in one day.We may have reached a crossroads in the market between mixed short-term sentiment, and mid-term and long-term optimism. In the short-term, there will be some optimistic days where investors rotate into cyclicals and value stocks, and pessimistic days where investors rotate into tech and “stay-at-home” names. On other days, such as Wednesday, the markets may broadly decline, and be led by specific sectors. On Wednesday, for example, the leading laggard was tech - specifically high flying chip stocks.In the mid-term and long-term, there is certainly a light at the end of the tunnel. Once this pandemic is finally brought under control and vaccines are mass deployed, volatility will stabilize, and optimism and relief will permeate the markets. Stocks especially dependent on a rapid recovery and reopening, such as small-caps, should thrive.According to Ed Yardeni, president and chief investment strategist at Yardeni Research, “Renewed lockdown restrictions in response to the third wave of the pandemic are likely to weigh on the economy in coming months, but we don’t expect a double-dip…(but) the economy could be booming next spring if enough of us are inoculated against the virus.”Other Wall Street strategists are bullish on 2021 as well. According to a JPMorgan note to clients released on Wednesday, a widely available vaccine will lift stocks to new highs in 2021.“Equities are facing one of the best backdrops for sustained gains next year,” JPMorgan said. “We expect markets to be driven by recovery from the COVID-19 crisis at the back of highly effective vaccines and continued extraordinary monetary and fiscal support.”JPMorgan’s S&P 500 target for 2021 is 4,400. This implies a nearly 20% gain from Wednesday’s closing price.On the other hand, for the rest of 2020, and maybe early on into 2021, markets will wrestle with the negative reality on the ground and optimism for an economic rebound.Additionally, since election week, the rally has invoked concerns of overheating with bad fundamentals. Commerce Street Capital CEO, Dory Wiley, advised caution in this overheated market. He pointed to 90% of stocks on the NYSE trading above their 200-day moving average as an indication that valuations might be stretched.“Timing the market is not always well-advised and paring back can miss out on some gains the next two months, but after such good returns in clearly a terrible fundamentals year, I think taking some profits and moving to cash, not bonds, makes some sense here,” he said.Amidst the current fears of a stall in economic recovery with further COVID-19-related shutdowns and no stimulus, it is very possible that short-term downside persists. However, if a stimulus deal passes before the end of the year, it could mean more market gains.Due to this tug of war between sentiments, it is truly hard to say with conviction that another crash or bear market will come. If anything, the mixed sentiment will keep markets relatively sideways.Therefore, to sum it up:While there is long-term optimism, there is short-term pessimism. A short-term correction is very possible. But it is hard to say with conviction that a big correction will happen. Can the Dow Stay Above 30,000?Since piercing the 30,000 level for a second time last Friday, and reaching record highs, the Dow Jones has largely traded sideways and hovered around the 30,000 level. There are some questions in the short-term as to whether or not the Dow can maintain this level. Outside of the Russell 2000, the Dow may be the index most vulnerable to news and sentiment.Volume has also quietly declined this week as well, which poses doubts on how sustainable the 30,000 level is. Low volume, especially a declining trend in volume, means that there are fewer shares trading. Lower volume also means less liquidity across the index, and an increase in stock price volatility.With so much uncertainty and the RSI still firmly in hold territory, the call on the Dow stays a HOLD.On pessimistic “sell the news” kinds of days, the Dow may have more downside pressure than other indices. Many cyclical stocks that depend on a strong economic recovery trade on this index, and any change in sentiment can adversely affect their performances.It is hard to say with certainty that a drop in the index will be strong and sharp relative to the gains since March - let alone November. But for now, as seen in the last week, I believe that we could be in a sideways holding pattern while investors digest all the news being thrown at them on a daily basis. For an ETF that attempts to directly correlate with the performance of the Dow, the SPDR Dow Jones ETF (DIA) is a strong option.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Stocks Surge to New Records on More Optimism

Stocks Surge to New Records on More Optimism

Finance Press Release Finance Press Release 18.12.2020 17:41
Major averages hit both all-time intraday and closing highs on Thursday (Dec. 17), riding on vaccine optimism and hopes that a stimulus package could be passed in a matter of days.News RecapThe Dow Jones climbed 148.83 points, or 0.5%, to 30,303.37 for a record close. Both the S&P 500 and Nasdaq hit intraday and closing records as well and gained 0.6% and 0.8%, respectively. In typical fashion, the Russell 2000 small-cap index once again beat the other indices and gained 1.30%.Senate Majority Leader Mitch McConnell on Thursday (Dec. 17) said that a stimulus deal was closing in. Congress appears to be nearing a $900 million stimulus package that would include direct payments to individuals. However, the package would exclude the partisan issues of liability protections for businesses and aid to state and local governments.Despite the optimistic tone of the day, jobless claims disappointed for a second consecutive week. Jobless claims totaled 885,000 last week, hitting their highest levels since early September. This was also significantly worse than the expected 808,000.An FDA panel officially endorsed Moderna's (MRNA) COVID-19 vaccine. It could officially be cleared for emergency usage as early as Friday (Dec. 18), and be distributed as soon as after the weekend. Upon authorization, government officials plan to ship nearly 6 million doses of Moderna’s vaccine in addition to the 2.9 million Pfizer (PFE) doses already in distribution.Real estate, materials and health care were the best-performing sectors in the S&P 500, each gaining over 1%. Johnson & Johnson (JNJ) rose 2.6% to lead the Dow higher.Tesla (TSLA) gained 5.32% and will now officially join the S&P 500.We are in the darkest days of the pandemic. On average, the U.S. is recording at least 215,729 additional COVID-19 cases a day . More than 114,200 Americans are also now hospitalized , and over 3,400 new deaths were recorded. According to the CDC Director, Robert Redfield, US COVID-19 deaths are likely to exceed the 9/11 death toll for the next 60 days.While sentiment has been positive over the last two trading sessions, there will still be a short-term tug of war between good news and bad news. It’s quite simple really - until a stimulus is passed and the virus is somewhat brought under control, there will be negative pressure on the markets. Even though a stimulus package passing appears to be imminent, time is running short and we may be at a fork in the road.For now, though, hopes that a deal could pass through are sending stocks higher.“Stimulus is still the main driver in the market right now until they get something done, and it does appear there is some motivation on that front to get something done,” said Dan Deming, managing director at KKM Financial, further stating that “the market’s benefiting from that (enthusiasm).”Additionally, Luke Tilley , chief economist at Wilmington Trust, said that another stimulus package was needed to keep the economic recovery from stalling before the mass distribution of a vaccine.“With the continued rising cases and mass vaccinations still a ways out, we could see some further weakness in jobs and even a flattening where we’re not even adding jobs at all ... that’s absolutely a possibility for this next jobs report,” Tilley said. “And if we were to not get another stimulus package, you’re going to have 10 to 11 million people fall off the unemployment rolls right away, and that would hit spending as well.”The overwhelming majority of market strategists are bullish on equities for 2021 though, despite near-term risks. While there may be some semblance of a “Santa Claus Rally” occurring, the general consensus between market strategists is to look past the short-term pain and focus on the longer-term gains. The mid-term and long-term optimism is very real.According to Robert Dye, Comerica Bank Chief Economist :“I am pretty bullish on the second half of next year, but the trouble is we have to get there...As we all know, we’re facing a lot of near-term risks. But I think when we get into the second half of next year, we get the vaccine behind us, we’ve got a lot of consumer optimism, business optimism coming up and a huge amount of pent-up demand to spend out with very low interest rates.”In the short-term, there will be some optimistic and pessimistic days. On some days, the broader “pandemic” market trend will happen, with cyclical and recovery stocks lagging, and tech and “stay-at-home” stocks leading. Sometimes a broad sell-off based on fear or overheating may occur as well. On other days, there will be a broad market rally due to optimism and 2021-related euphoria. Additionally, there will be days (and in my opinion this will be most trading days), when markets will trade largely mixed, sideways, and reflect uncertainty. But if we get an early Christmas present and a stimulus package passes, all bets are off. It could mean very good things for short-term market gains.In the mid-term and long-term, there is certainly a light at the end of the tunnel. Once this pandemic is finally brought under control and vaccines are mass deployed, volatility will stabilize, and optimism and relief will permeate the markets. Stocks especially dependent on a rapid recovery and reopening, such as small-caps, should thrive.Due to this tug of war between sentiments though, it is truly hard to say with any degree of certainty that a correction will happen or more record high rallies will occur.Therefore, to sum it up:While there is long-term optimism, there is short-term pessimism. A short-term correction is very possible, but it is hard to say with conviction that a big correction will happen.The premium analysis this morning will showcase a “Drivers and Divers” section that will break down some sectors that are in and out of favor. As a token of my appreciation for your patronage, I decided to give you a free sample of a “driver” and “diver” sector. Please do me a favor and let me know what you think of this segment! I’m always happy to hear from you. DrivingSmall-Caps (IWM)In typical fashion, the Russell 2000 small-cap index once again beat the other indices and gained 1.30% on Thursday (Dec. 17). I truly love small-cap stocks in the long-term and this small-cap rally is more encouraging than the “stay-at-home” stock rallies from April/May. This is a bullish sign for a long-term economic recovery and shows that investors are optimistic that a vaccine will return life to relatively normalcy in 2021.I do have some concerns of overheating in the short-term however, especially with the headwinds that still exist. The Russell keeps outperforming no matter what the market sentiment of the day or week is. For example, although the week ended December 11th was an overall down week, the Russell 2000 STILL managed to outperform the larger indices and eek out another weekly gain of 1.02%. While it is remarkable, I do not see how this is sustainable in the short-term.The performance of the Russell 2000 index since early November has been nothing short of staggering. Although the Russell index is composed mostly of small-cap value cyclical stocks dependent on the recovery of the broader economy, and may be more adversely affected on “sell-the-news” kind of days, its hot streak since November has not cooled off in the slightest.Since the start of November, the Russell 2000 has skyrocketed and considerably outperformed the other major indices. The iShares Russell 2000 ETF (IWM), in comparison to the ETFs tracking the Dow (DIA), S&P (SPY), and Nasdaq (QQQ), has risen 28.62%. This is at least 13% higher than all of the other major indices. Since the start of December, the Russell ETF has also outperformed the other ETFs between 4%-5%.However, when looking at the chart for the Russell 2000 ETF (IWM) , it becomes pretty evident that small-cap stocks have overheated in the short-term. These are stocks that will experience more short-term volatility. Stocks don’t always go up but the Russell’s trajectory since November has been essentially vertical. The IWM ETF keeps hitting record highs while the RSI keeps overinflating way past overbought levels. I would SELL and trim profits for the short-term but do not fully exit these positions. A stimulus could be imminent and send these stocks soaring more. But if there is a pullback, BUY for the long-term recovery. DivingUS Dollar ($USD)The U.S. Dollar’s plunge continues to its lowest levels in years. I called the return to oversold levels this week despite the currency piercing the 91-level last Wednesday (Dec. 9). I knew it was “fool's gold” and not the sign of any sort of breakout. I have been calling the dollar’s weakness for weeks despite its low levels, and I expect the decline to continue.For the first time since April 2018, the world’s reserve currency is now trading below 90.Why did the dollar plunge so much on Thursday (Dec. 17)? You can thank the Fed! After the Federal Reserve’s dovish tone and reassurance on Wednesday (Dec. 16) that it won’t be soon tapering its bond purchases, bearish traders took this as a sign to continue selling the dollar.“The latest blow to the dollar came from the Fed, which vowed not to touch policy even if the outlook for the U.S. economy brightens as it now expects,” said Joe Manimbo , senior analyst at Western Union Business Solutions.After hitting a nearly 3-year high in March, the dollar has plunged in excess of 13%.Meanwhile, other currencies continued strengthening on Thursday (Dec. 17), relative to the dollar:The euro rose 0.6% to $1.2270, hitting its highest level versus the dollar since April 2018. The euro is up more than 9% year to date.The dollar fell to a more-than-three-year low versus the Japanese yen and declined 0.4% to ¥103.07.The British pound was up 0.5% at $1.3575 - its highest since April 2018.Both the Australian dollar and the New Zealand dollar each gained 0.6% versus the US dollar.The US dollar was off 0.1% vs. the Canadian dollar.After briefly rising above an oversold RSI of 30 last week, the dollar’s RSI is at an alarmingly low 22.96. The dollar is also significantly trading below both its 50-day and 200-day moving averages.Many believe that the dollar could fall further too.If the world returns to relative normalcy within the next year, investors may be more “risk-on” and less “risk-off,” meaning that the dollar’s value will decline further.Additionally, because of all of the economic stimulus and seemingly imminent additional stimulus, the dollar’s value has declined and could have more room to fall. With a dovish Fed and record low-interest rates projected to remain this low for at least another two years, the dollar may not appreciate again for a very long time.While the dollar may have more room to fall, this MAY be a good opportunity to buy the world’s reserve currency at a discount - at least for a quick short-term trade. The low RSI reflects this.But I just have too many doubts on the effect of interest rates this low, government stimulus, strengthening of emerging markets, and inflation to be remotely bullish on the dollar’s prospects over the next 1-3 years.For now, where possible, HEDGE OR SELL USD exposure.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Gold & the USDX: Correlations

Stocks Fall but Close Week Positive

Finance Press Release Finance Press Release 21.12.2020 16:45
Quick UpdateDear readers, before we get into today’s news and stock analysis and because I’ve been receiving many questions from you, I’d like to first clarify what I mean by BUY, SELL, or HOLD. Here, I am largely referring to outperforming the S&P 500. When the conditions favor adding risk and buying the U.S. market overall, I will be issuing an "alert." I am not sure yet whether I will be moving to entry prices or target prices & stop losses, however, I have discussed this internally with the team at Sunshine Profits. In the current market environment, when fundamentals have essentially fallen to the wayside, I prefer to invest directionally rather than being married to certain levels in the market. In my view, trading with specific figures in mind can hurt long term returns if you do not let your winners run and cut your losers fast. I do update my calls daily, though, and any changes will be highlighted! Thank you again for being such great readers - I truly value your trust. Stay tuned for updates and let me know if you have any other questions!Let’s begin Monday by reviewing what happened at the close of last week.Volatile trading occurred on Friday (Dec. 18), with Congress struggling to close out a stimulus package, causing stocks to slip from record highs.News RecapThe Dow Jones fell 124.32 points, or 0.4%, to 30,179.05. At its session low, the index fell more than 270 points. The S&P 500 also dipped 0.4% and snapped a three-day winning streak. The Nasdaq fell only 0.1%, while the small-cap Russell 2000 fell 0.41%.While Congress claims to be on the brink of a $900 billion stimulus deal , it is working against time. In public, leaders are speaking optimistically that a deal will pass, however, there are last-minute partisan disputes on direct payments, small business loans, and a boost to unemployment insuranceThere was an unusually large amount of trading volume on Friday (Dec. 18) as Tesla (TSLA) was set to officially join the S&P 500 after the closing bell. Tesla is being added to the index in one fell swoop, marking the largest rebalancing of the S&P 500 in history. After surging 700% in 2020, from day 1, Tesla will be the seventh-largest company in the S&P in terms of market cap.The FDA officially approved Moderna’s vaccine for emergency use. Government officials plan to ship nearly 6 million doses of Moderna’s vaccine in addition to the 2.9 million Pfizer (PFE) doses already in distribution.Despite Friday’s (Dec. 18) losses, the indices closed out the week with mild gains. The Dow closed up 0.4%, the S&P 500 advanced 1.3%, and the NASDAQ closed up 3.1%. The small-cap Russell 2000 continued its strong run as well and gained 2.5% for the week.Meanwhile, the pandemic has reached its darkest days and is hitting unforeseen and unprecedented numbers . The U.S. shattered the previous record of daily deals on Wednesday (Dec. 16), recording over 3,600 deaths. As of Friday (Dec. 18), the country has also now surpassed 17 million confirmed cases, with death totals soaring past 300,000. California, Illinois, Pennsylvania, and Texas alone reported more than 1,000 deaths in the past week.While the general focus between both investors and analysts appears to be on the long-term potential in 2021, there are certainly short-term concerns. Inevitably, there will be a short-term tug of war between good news and bad news. For now, though, the main catalyst is the stimulus package. If a stimulus package is passed before Christmas, the markets could benefit. If it doesn’t, markets will drop. Time is running short and we may be at a fork in the road.According to Luke Tilley , chief economist at Wilmington Trust, another stimulus package was needed to keep the economic recovery from stalling before the mass distribution of a vaccine.“With the continued rising cases and mass vaccinations still a ways out, we could see some further weakness in jobs and even a flattening where we’re not even adding jobs at all ... that’s absolutely a possibility for this next jobs report,” Tilley said. “And if we were to not get another stimulus package, you’re going to have 10 to 11 million people fall off the unemployment rolls right away, and that would hit spending as well.”However, despite near-term risks, the overwhelming majority of market strategists are bullish on equities for 2021, especially for the second half of the year. While there may be some short-term worries, the consensus between market strategists is to look past the short-term pain and focus on the longer-term gains. Although the economic recovery could stutter in the early half of the year, the general focus is on the second half of the year when we could potentially return to normal. Many analysts expect double-digit gains to continue in 2021, with strategists in a CNBC survey expecting an average 9.5% rise in 2021 for the S&P 500.Additionally, according to Robert Dye, Comerica Bank Chief Economist :“I am pretty bullish on the second half of next year, but the trouble is we have to get there...As we all know, we’re facing a lot of near-term risks. But I think when we get into the second half of next year, we get the vaccine behind us, we’ve got a lot of consumer optimism, business optimism coming up and a huge amount of pent-up demand to spend out with very low interest rates.”In the short-term, there will be some optimistic and pessimistic days. On some days, the broader “pandemic” market trend will happen, with cyclical and recovery stocks lagging, and tech and “stay-at-home” stocks leading. Sometimes a broad sell-off based on fear or overheating may occur as well. On other days, there will be a broad market rally due to optimism and 2021-related euphoria. Additionally, there will be days (and in my opinion this will be most trading days), when markets will trade largely mixed, sideways, and reflect uncertainty. But if we get an early Christmas present and a stimulus package passes, all bets are off. It could mean very good things for short-term market gains.Despite the optimistic potential, the road towards normalcy will hit inevitable speed bumps. While it is truly hard to say with conviction that a short-term rally or bear market will come, I do believe that some consolidation and a correction could be possible in the short-term on the way towards another strong rally in the second half of 2021.Outside of economic damages and an out-of-control virus, the market itself is flashing potential signs of over-optimism and euphoria. In its most recent survey, for example, the American Association of Individual Investors (AAII) found that 48.1% of investors identified as being bullish - well above the historical average of 38%. With an overabundance of cocky, euphoric, and optimistic investors, the market becomes more vulnerable to selling pressure. Corrections are very common though. Only twice in the last 38 years have we had years WITHOUT a correction (1995 and 2017). Because there has not been one since the lows of March, we could be due for one in the early part of 2021.Therefore, to sum it up:While there is long-term optimism, there are short-term concerns. A short-term correction in early 2021 is very possible, but I do not believe, with certainty, that a correction above ~20% leading to a bear market will happen. Has the Nasdaq Officially Overheated?Don’t ever let anyone tell you “this time is different” if fears of the dot-com bubble are discussed. History repeats itself, especially in markets. I have many concerns about tech valuations and their astoundingly inflated levels. The recent IPOs of DoorDash (DASH) and AirBnB (ABNB) reflect this. I believe that more pullbacks along the lines of Wednesday, December 9th’s session could inevitably come in the short-term.Pay close attention to the RSI. While an overbought RSI does not automatically mean a trend reversal, I called keeping a very close eye on this for the Nasdaq. The December 9th Nasdaq pullback, after it exceeded a 70 RSI, reflects that.The RSI is now above 70. Monitor this . With unstable volume to start the week on the horizon, as Tesla officially joins the S&P 500, I am calling for some short-term volatility. I did not make a conviction call last week but I am not making that mistake again. Because the RSI is officially above 70, and because I foresee unstable volume thanks to Tesla, take profits and SELL some shares, but do not fully exit .While tech has overheated, there is still some very real long-term optimism based on stimulus hopes and 2021’s potential.Furthermore, on pessimistic days, having Nasdaq exposure is crucial because of the “stay-at-home” trade.For an ETF that attempts to directly correlate with the performance of the NASDAQ, the Invesco QQQ ETF (QQQ) is a good option.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Gold & the USDX: Correlations

Stimulus Hopes Fail to Rally Markets

Finance Press Release Finance Press Release 23.12.2020 15:59
The S&P 500 closed down for the third consecutive day (Dec. 22), despite Congress’s long-overdue approval of an economic stimulus package.News RecapThe Dow Jones declined 200.94 points, or 0.7%, to 30,015.51. The S&P 500 closed down for a third consecutive day and fell 0.2%. Reflecting a return to the “stay-at-home” tech trade, the Nasdaq gained 0.5% on the day (Dec. 22). The small-cap Russell 2000 index managed to outperform yet again, rising 1.01%.Congress finally voted on and approved a $900 billion stimulus package to aid struggling Americans. Attached to this bill was also a $1.4 trillion measure to fund the government through Sept. 30. President Trump is expected to sign the bill into law within the next few days.A mutant strain of COVID-19 discovered in the UK weighed on markets for a second consecutive day. While the vaccine(s) could still be effective on this strain, the strain appears to be more contagious than others. The discovery of this virus strain has caused stricter lockdown measures and travel restrictions worldwide.Travel stocks were the laggards of the day due to fears of the new strain of COVID-19. American Airlines (AAL) fell 3.9% and United (UAL) dropped 2.5%. Cruise lines all fell as well. Carnival (CCL) fell nearly 6%, Royal Caribbean (RCL) dropped nearly 3%, and Norwegian (NCL) plummeted 6.9%Apple (AAPL) led the Nasdaq higher as it jumped 2.9% due to investor excitement about their EV plans to challenge Tesla (TSLA) by 2024Mixed economic data came in on Tuesday (Dec. 22). The final reading on Q3’s GDP growth found that the US GDP grew 33.4% on an annualized basis, compared to the estimated 33.1%. On the other hand, US consumer confidence fell for the second month in a row and missed expectations - despite vaccine optimism.COVID-19 has now killed over 318,000 Americans (and counting). The CDC announced that this is now the deadliest year in American history as total deaths are expected to top 3 million for the first time. Deaths are also expected to jump 15% from the previous year. This would mark the largest single-year percentage leap since 1918, when WWI and fatalities from the Spanish Flu Pandemic caused deaths to rise an estimated 46%.Markets have officially stumbled before Christmas and experienced a predictable tug-of-war between good news and bad news. While the general focus of both investors and analysts has appeared to be the long-term potential of 2021, there are some very concerning short-term headwinds.Although there was some anticipation that a stimulus deal could send stocks higher in the near-term, investors may be simply taking profits before the year’s end and rebalancing for 2021. On the other hand, it is very possible that the stimulus package was “too little too late,” and is being overshadowed by a more contagious strain of COVID-19 discovered over the past weekend in the U.K.While nobody predicted a renegade mutant virus weighing on market sentiment, short-term battles between optimism and pessimism were quite predictable.According to a note released on Monday (Dec. 21) from Vital Knowledge’s Adam Crisafulli“The market has been in a tug-of-war between the very grim near-term COVID backdrop and the increasingly hopeful medium/long-term outlook (driven by vaccines) – the latter set of forces are more powerful in aggregate, but on occasion, the market decides to focus on the former, and stocks suffer as a result.”Meanwhile, the overwhelming majority of market strategists, including myself, are bullish on equities for 2021. It might just be a bit of a bumpy road getting there. I believe that a correction and some consolidation could be very likely in the short-term, on the way towards another strong rally in the second half of 2021. While it is hard to say with conviction WHEN we could see a correction, I believe that the market’s behavior as of late could be a potential preview of what’s to come between now and the end of Q1 2020. There is optimistic potential, but I believe a potential 5% pullback before the year’s end is possible, as well as a minimum 10% correction before the end of Q1 2020.According to Jonathan Golub , Credit Suisse’s chief U.S. equity strategist, choppiness in the economy and markets in the coming months could be expected before a surge in consumer spending by mid-2021. Golub said, “I don’t think that there’s a smooth, easy straight-line story on this...I think for the next three or four months, the reopening process is going to be sloppy.”I believe that the S&P’s three-day losing streak could be an ominous sign of what’s to come in the near-term. I do believe though that this is healthy and could be a good thing.Before Monday’s (Dec. 21) session, I had warned that the market was flashing signs of over-optimism and euphoria. In its most recent survey, for example, the American Association of Individual Investors (AAII) found that 48.1% of investors identified as being bullish - well above the historical average of 38%.A correction could be just what this market needs. Corrections also happen way more often than people realize. Only twice in the last 38 years have we had years WITHOUT a correction (1995 and 2017). I believe we are overdue for one because there has not been a correction since the lows of March. This is healthy market behavior and could be a very good buying opportunity for what I believe will be a great second half of the year.The mid-term and long-term optimism are very real, despite the near-term risks. The passage of the stimulus package only solidifies the robust vaccine-induced tailwinds entering 2021, specifically for small-cap value stocks.In the short-term, there will be some optimistic and pessimistic days. On some days, such as Tuesday (Dec. 22), the “pandemic” market trend will happen - cyclical and COVID-19 recovery stocks lagging, and tech and “stay-at-home” stocks leading. On other days, a broad sell-off based on virus fears may occur as well. Additionally, there will also be days where there will be a broad market rally due to optimism and 2021 related euphoria. And finally, there will be days (and in my opinion, this will be most trading days), that will see markets trading largely mixed, sideways, and reflecting uncertainty.Therefore, to sum it up:While there is long-term optimism, there are short-term concerns. A short-term correction between now and Q1 2021 is very possible. But I do not believe, with conviction, that a correction above ~20% leading to a bear market will happen.The premium analysis this morning will showcase a “Drivers and Divers” section that will break down some sectors that are in and out of favor. As a token of my appreciation for your patronage, I decided to give you a free sample of a “driver” and “diver” sector. Please do me a favor and let me know what you think of this segment! I’m always happy to hear from you. DrivingSmall-Caps (IWM)The Russell 2000 small-cap index once again beat the larger-cap indices and gained 1.01% on Tuesday (Dec. 22). Despite the profit-taking and negative sentiment during Tuesday’s (Dec. 22) session, small-caps didn’t get the memo.I do love small-cap stocks in the long-term and this small-cap rally is more encouraging than the “stay-at-home” stock rallies from April/May. This is a bullish sign for long-term economic recovery and shows that investors are optimistic that a vaccine will return life to relative normalcy by mid-2021.I do have some concerns about overheating in the short-term though. As I mentioned before, I believe that the S&P’s losing streak is only a preview of what could come in the next 1-3 months.According to the chart above for the Russell 2000 ETF (IWM) , it becomes pretty evident that small-cap stocks have overheated in the short-term. Stocks won’t always go up, but the IWM’s trajectory since November has been essentially vertical. The ETF keeps hitting record highs while the RSI keeps overinflating way past overbought levels as the volume shows instability.Since November, the Russell index has been on a run nothing short of astounding. Just look how the iShares Russell 2000 ETF (IWM) compares to the ETFs tracking the Dow, S&P, and Nasdaq in that time frame. Since November, the IWM has risen nearly 28% and has at least doubled the returns of the ETFs tracking the other major indices.Although the Russell index is composed mostly of small-cap cyclical stocks dependent on the recovery of the broader economy and may be more adversely affected on “sell-the-news” kind of days, its hot streak since November has seemingly not cooled off as much as other indices and sectors.But I believe this will eventually happen in the short-term, and I hope it does for a long-term buying opportunity.In the short-term, small-cap stocks may have overheated and could experience the greatest volatility. SELL and take short-term profits if you can, but do not fully exit positions .If there is a pullback, BUY for the long-term recovery. DivingUS Dollar ($USD)If the dollar rallies at all again soon, do not be fooled.Ever since I called the dollar’s rally past the 91 level two Wednesdays ago (Dec. 9) a mirage, the dollar has declined by 1.25%.I believed it to be “fool's gold” then and I believe any subsequent rally that could come will be “fool’s gold” too.I still am calling out the dollar’s weakness after several weeks, despite its low levels. I expect the decline to continue as well thanks to a dovish Fed.The world’s reserve currency is still trading below 90 and has not traded this low since April 2018. Joe Manimbo , a senior analyst at Western Union Business Solutions, seemingly agrees with me as well and said that “the latest blow to the dollar came from the Fed, which vowed not to touch policy even if the outlook for the U.S. economy brightens as it now expects.”Since hitting a nearly 3-year high on March 20th, the dollar has plunged nearly 13% while emerging markets and other currencies continue to strengthen.On days when COVID-19 fears outweigh any other positive sentiments, dollar exposure might be good to have since it is a safe haven. But in my view, you can do a whole lot better than the US dollar for safety.I have too many doubts on the effect of interest rates this low for this long, government stimulus, strengthening of emerging markets, and inflation to be remotely bullish on the dollar’s prospects over the next 1-3 years. Meanwhile, the US has $27 trillion of debt, and it’s not going down anytime soon.Additionally, according to The Sevens Report , if the dollar falls below 89.13, this could potentially raise the prospect of a further 10.5% decline to the next support level of 79.78 reached in April 2014After briefly rising above an oversold RSI of 30 last week, the dollar’s RSI is now at an alarmingly low 27.87. The dollar is also significantly trading below both its 50-day and 200-day moving averages.While the dollar may have more room to fall, this MAY be a good opportunity to buy the world’s reserve currency at a discount as the RSI is oversold. But I just feel you can do a whole lot better than the USD right now.I’m not a crypto guy either myself, but Bitcoin’s run compared to the dollar’s disastrous 2020 has to really make you think sometimes….For now, where possible, HEDGE OR SELL USD exposure.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Stocks Post Records to Start 2021

Stocks Post Records to Start 2021

Finance Press Release Finance Press Release 11.01.2021 21:31
The indices hit record highs yet again to close off the first week of 2021 and weighed unrest, poor jobs data, and further prospects of economic stimulus.News RecapBoth the Dow and S&P 500 closed the week off with four-day win streaks. The Dow climbed 56.84 points, or 0.2%, at 31,097.97. The S&P 500 rose 0.6% to 3,824.68, and the Nasdaq popped 1% to 13,201.98. The small-cap Russell 2000 declined 0.25%.The Dow and S&P 500 each gained more than 1% on the week, while the Nasdaq gained 2.4%, and the Russell 2000 surged by nearly 6%. These gains to start the year came despite the unprecedented unrest and invasion of the Capitol by Trump supporters on Wednesday (Jan. 6).Despite Democrats winning full control of the Senate, the Dow briefly declined 200 points midday after moderate Democrat Senator Joe Manchin from West Virginia told The Washington Post that he would “ absolutely not ” support a round of $2,000 stimulus checks. Manchin mildly walked back those comments later in the day and said he was “undecided,” and not outright opposed to it.The U.S. economy lost 140,000 jobs in December , according to the Labor Department. This is significantly worse than the estimated gain of 50,000 according to economists polled by Dow Jones.The 10-year yield rose to its highest level since March 20, and broke above 1.1%.Coca-Cola (KO) rose 2.2% to lead the Dow higher. The consumer discretionary and real estate sectors each rose more than 1%, lifting the S&P 500. The Nasdaq got a boost from Tesla, which popped 7.8%.The first week of 2021 largely continued where 2020 left off- with turmoil, tension, and a barrage of news. Another 2020 pattern continued to kick off the new year- a resilient market.A week that started off with a sharp sell-off concluded with sharp weekly gains, all-time highs, and a four-day winning streak for the Dow and S&P 500. This is despite the first assault on the U.S. Capitol since 1814, despite COVID-19 cases continuing to wreak havoc, and despite a disastrous jobs report.How could this be?The results of the Georgia election can first and foremost be credited for the market surge.Although tech initially plummeted due to fears of higher taxes and stricter regulations, with full Democrat control of the Presidency, Senate, and House, there is finally clarity and expectations of further spending and government stimulus.Although President-elect Joe Biden had promised to pass a measure for bigger stimulus checks if Democrats secured control of the Senate, comments from West Virginia Senator Joe Manchin, a moderate Democrat, spooked investors for a time on Friday (Jan. 8). Although Manchin briefly walked these comments back, according to Bill Miller, founder of Miller Value Partners , “Nothing is going to get passed if they can’t get the moderates in the Democratic Party, or the Republican Party for that matter, to go along with (further stimulus).”President-elect Biden said Friday (Jan. 8) that a new aid package would be “ in the trillions of dollars .” This comes after Goldman Sachs stated that it expects another big stimulus package of around $600 billion . Value stocks and small-cap stocks have surged as a result of these prospects.Despite the prospect of further stimulus that could heat up the economy, the short-term tug of war between good news and bad news will continue. Many of these moves upwards or downwards are based on emotion and sentiment, and there could be some serious volatility in the near-term. Although markets have kicked off the new year with excitement from the “Blue Wave”, consider this.Stocks have overstretched valuations, the Capitol was invaded, the pandemic is out of control, and the vaccine roll-outs have been clunky at best.Even though the markets saw a nice weekly gain to kick off 2021 and the 10-year treasury is at its highest level in months, a correction between now and the end of Q1 2020 is likely.National Securities’ chief market strategist Art Hogan also believes that we could see a 5%-8% pullback as early as this month.Generally, corrections are healthy, good for markets, and more common than most realize. Only twice in the last 38 years have we had years WITHOUT a correction (1995 and 2017). I believe we are long overdue for one. We haven’t seen a correction since March 2020. This is healthy market behavior and could be a very good buying opportunity for what I believe will be a great second half of the year.While there will certainly be short-term bumps in the road, I love the outlook in the mid-term and long-term once the growing pains of rolling out vaccines stabilize. The pandemic is awful and the numbers are horrifying. But despite this, and despite the horrendous jobs report, there is one report released this past week that could be a step in the right direction - the ISM manufacturing data.The consensus is that 2021 could be a strong year for stocks. According to a CNBC survey which polled more than 100 chief investment officers and portfolio managers, two-thirds of respondents said the Dow Jones will most likely finish 2021 at 35,000, while five percent also said that the index could climb to 40,000.Therefore, to sum it up:While there is long-term optimism, there are short-term concerns. A short-term correction between now and Q1 2021 is very possible. I don’t think that a correction above ~20% leading to a bear market will happen. Can Small-caps Own 2021?Figure 1- iShares Russell 2000 ETF (IWM)Small-caps were the comeback kids this week. Although I believed that the Russell 2000’s record-setting run since the start of November was coming to an end, the iShares Russell 2000 ETF (IWM) had itself quite a week and rallied 7.35% since January 4th. Small-cap stocks were the most excited from the Democrat sweep in Georgia due to hopes of further economic stimulus on the horizon.I love small-cap stocks in the long-term, especially as the world reopens. A Democrat-dominated Congress could help these stocks too, but in the short-term, the index, by any measurement, has simply overheated. Before January 4th, the RSI for the IWM Russell 2000 ETF was at an astronomical 74.54. I called a pullback happening in the short-term due to this RSI, and it happened. Well now the RSI is back above 74 again, and I believe that a more significant correction in the near-term could be imminent.Stocks simply just don’t always go up in a straight line, and that’s what the Russell 2000 has essentially been between November and December. It’s looked eerily similar this week.What this also comes down to, is that small-caps are more sensitive to the news - good or bad. I think that vaccine gains have possibly been baked in by now. There could be another near-term pop due to further stimulus hopes, but it’s likely that small-caps in the near-term could trade sideways before an eventual larger pullback.I hope small-caps decline a minimum of 10% before jumping back in for long-term buying opportunities.SELL and take this week’s profits if you can - but do not fully exit positions .If there is a pullback, this is a STRONG BUY for the long-term recovery.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Surprise! Nasdaq Leads Weekly Gains

Surprise! Nasdaq Leads Weekly Gains

Finance Press Release Finance Press Release 25.01.2021 17:08
In a surprise twist, the Nasdaq surged by a healthy 4.2%, managing to close the week at an all-time high. What’s happening to tech stocks?Surging, gaining...come again?Wasn't tech supposed to wither away and die thanks to be big bad Democrat boogeymen? Wasn’t the radical Biden tax agenda and regulatory framework supposed to send your favorite tech stocks plummeting? Wasn’t Biden’s tax plan supposed to take an estimated 5-10% off the earnings per share?For now, it seems like the market is putting more of its hopes into Biden's $1.9 trillion stimulus plan and ignoring his tax and regulation plans. As Treasury Secretary and former Fed Chair Janet Yellen claimed, Biden's primary focus is aiding American families (i.e., stimulus, low-interest rates) and, for now, not raising taxes.But nothing is for sure with this stimulus. Republicans will resist it, and some moderate Democrats may do so as well. With Vice President Kamala Harris as the only tiebreaker for a Democrat majority in the Senate, Biden needs all the support he can get to pass this aggressive stimulus.I maintain my view that the market is too complacent, and that we are about to enter a correction at some point in the short-term. It still reminds me of the Q4 2018 pullback ( read my story here ).For one, valuations are absurd. Tech IPOs are a circus, the S&P 500 is at or near its most-expensive level in recent history on most measures, and the Russell 2000 has never traded this high above its 200-day moving average.While stimulus could be useful for stocks in the short-term, it could almost certainly mean the return of inflation too by mid-year. The worst part about it? The Fed will likely let it run hot. With debt rising and consumer spending expected to increase as vaccines are rolled out to the masses, the Fed is undoubtedly more likely to let inflation rise than letting interest rates rise.Others, however, believe that the market reflects optimism that the global economy will recover with the eventual lifting of COVID-related restrictions and more widely-available vaccines. John Studzinski , vice chairman of Pimco, believes that market valuations are strong and reflect expectations of this eventual reopening and economic recovery by the second half of the year.All of this simply tells me that the market remains a pay-per-view fight between good news and bad news.We may trade sideways this quarter- that would not shock me in the least. But I think we are long overdue for a correction since we haven’t seen one since last March.Corrections are healthy for markets and more common than most realize. Only twice in the last 38 years have we had years WITHOUT a correction (1995 and 2017).A correction could also be an excellent buying opportunity for what should be a great second half of the year.Therefore, to sum it up:While there is long-term optimism, there are short-term concerns. A short-term correction between now and Q1 2021 is possible. I don't think that a decline above ~20%, leading to a bear market will happen.In a report released last Tuesday (Jan. 19), Goldman Sachs shared the same sentiments.My goal for these updates is to educate you, give you ideas, and help you manage money like I did when I was pressing the buy and sell buttons for $600+ million in assets. I left that career to pursue one where I could help people who needed help, instead of the ultra-high net worth. Hopefully, you find my insights enlightening, and I welcome your thoughts and questions.We have a critical week ahead with the Fed set to have its first monetary policy meeting of the year and big earnings announcements on the horizon. Best of luck, have an excellent trading week, and have fun! We'll check back in with you all mid-week. Are We in a Tech Bubble or Not?Figure 1- Nasdaq Composite Index $COMPSome of the hottest performing tech stocks announce earnings this week such as Apple (AAPL), Amazon (AMZN), Microsoft (MSFT), Tesla (TSLA) (yes I consider Tesla more of a tech stock than a car stock), and more.Pay very close attention.Although I am bullish on specific tech sectors such as cloud computing, e-commerce, and fintech for 2021, I’m concerned about the mania consuming tech stocks.Tech valuations, and especially the tech IPO market, terrify me. It reminds me a lot of the dot-com bubble 20-years ago. Remember, the dot-com bubble was a major crash in the Nasdaq after excessive speculation and IPOs sent any internet-related stock soaring. Between 1995-2000 the Nasdaq surged 400%. By October 2002, the Nasdaq declined by a whopping 78%.I have no other words to describe it besides the Nasdaq right now as a circus. Will the bubble pop now? That remains to be seen. But the similarities between now and 2000 are striking.I am sticking with the theme of using the RSI to judge how to call the Nasdaq. An overbought RSI does not automatically mean a trend reversal, but with the Nasdaq, this appears to have been a consistent pattern over the last few weeks.The Nasdaq pulled back on December 9 after exceeding an RSI of 70 and briefly pulled back again after passing 70 again around Christmas time. We also exceeded a 70 RSI just before the new year, and what happened on the first trading day of 2021? A decline of 1.47%.The last time I changed my Nasdaq call from a HOLD to a SELL on January 11 after the RSI exceeded 70, the Nasdaq declined again by 1.45%.The Nasdaq has an RSI of around 72 again, and I’m switching the call back to SELL. The Nasdaq is trading in a precise pattern and I am basing my calls on that pattern.I still love tech and am bullish for 2021. But I need to see the Nasdaq have a legitimate cooldown period and move closer to its 50-day moving average before considering it a BUY.For an ETF that attempts to directly correlate with the performance of the NASDAQ, the Invesco QQQ ETF (QQQ) is a good option.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Gold & the USDX: Correlations

PMs Charging Higher As Stocks Keep Pushing On a String

Monica Kingsley Monica Kingsley 09.02.2021 16:23
Stocks keep cooling off at their highs, and calling for a correction still seems to be many a fool‘s errand. Does it mean all is fine in the S&P 500 land? Largely, it still is.Such were my yesterday‘s words:(…) It‘s still strong the stock market bull, and standing in its way isn‘t really advisable. With the S&P 500 at new highs, and the anticipated slowdown in gains over Friday, where is the momentary balance of forces?Still favoring the bulls – that‘s the short answer before we get to a more detailed one shortly.The anticipaded gold rebound is underway, and my open long position is solidly profitable right now. In line with the case I‘ve been making since the end of January, the tide has turned in the precious metals, and we are in a new bull upleg, which will get quite obvious to and painful for the bears. Little noted and commented upon, don‘t forget though about my yesterday‘s dollar observations, as these are silently marking the turning point I called for, and we‘re witnessing in precious metals:(…) The weak non-farm employment data certainly helped, sending the dollar bulls packing. It‘s my view that we‘re on the way to making another dollar top, after which much lower greenback values would follow. Given the currently still prevailing negative correlation between the fiat currency and its shiny nemesis, that would also take the short-term pressure of the monetary metal(s). What would you expect given the $1.9T stimulus bill, infrastructure plans of similar price tag, and the 2020 debt to GDP oh so solidly over 108%? Inflation is roaring – red hot copper, base metals, corn, soybeans, lumber and oil, and Treasury holders are demanding higher yields especially on the long end (we‘re getting started here too). Apart from the key currency ingredient, I‘ll present today more than a few good reasons for the precious metals bull to come roaring back with vengeance before too long.Finally, I‘ll bring you an oil market analysis today as well. So, let‘s dive into the charts (all courtesy of www.stockcharts.com).S&P 500 Outlook and Its InternalsA strong chart with strong gains, and the volume isn‘t attracting either much buying or selling interest. That smacks of continued accumulation, with little in terms of clearly warning signs ahead.The market breadth indicators are all very bullish, and pushing for new highs, as the caption points out precisely.The intermediate picture remains one of strength.Credit Markets and TechnologyHigh yield corporate bonds to short-term Treasuries (HYG:SHY) ratio is powering higher significantly stronger than the investment grade corporate bonds to longer-dated Treasuries (LQD:IEI) one. The bullish spirits are clearly running high in the markets.Technology (XLK ETF) as the leading heavyweight S&P 500 sector, keeps charging higher vigorously after not so convincing post-Aug performance. Crucially, its current advance is well supported by the semiconductors (XSD ETF – black line), meaning that apart from the rotational theme I‘ve been been mentioning last Thursday, we have the key tech sector firing on all cylinders still.Gold & SilverLet‘s overlay the gold chart with silver (black line). The disconnect since the Nov low should be pretty obvious, and interpreted the silver bullish way I‘ve been hammering for weeks already. Please also note that the white metal has been outperforming well before any silver squeeze caught everyone‘s attention.Let‘s go on with gold and the miners (black line). See that end Jan dip I called as fake? Where are we now? Miners are no longer underperforming, and the stage is set for a powerful rise.Just check the gold miners to silver miners view to get an idea of how much the white metal‘s universe is leading everything gold. Another powerful testament to the nascent bull upleg in the precious metals.Continuing with gold and long-term Treasuries (black line), we see that the king of metals isn‘t giving in. Instead, it‘s rising in the face plunging Treasuries that are offering higher yields now. No, the yellow metal is decoupling here, as the new precious metals upleg is getting underway. The greenback is the culprit – and again in my yesterday‘s analysis, I called the headwinds it‘s running into. The world reserve currency will indeed get under serious pressure and break down to new lows as the important local top is being made.From the Readers‘ Mailbag - OilQ: "Hi Monica, I am glad I found you after you 'disappeared' from Sunshine Profits! As you had been back then already covering gold and oil at times, I wonder what's your take on black gold right now. A little great birdie told me oil will be the next Tesla for 2021 - what's your take?"A: I am also happy that you found me too! Thankfully, my „disappearance“ is now history. I‘ll gladly keep commenting, in total freedom, on any question dear readers ask me. Back in autumn 2020, seeing the beaten down XLE, I wrote that energy is ripe for an upside surprise. I was also featuring the fracking ETF (FRAK) back then. Both have risen tremendously, and it‘s my view that the oil sector (let‘s talk $WTIC) is set for strong gains this year, and naturally the next one too. Think $80 per barrel. Part of the answer is the approach to „dirty“ energy that strangles supply, and diverts resources away from exploitation and exploration. Not to mention pipelines. Did you know that the overwhelming majority of ‚clean‘ energy to charge electric cars, comes from coal? And that the only coal ETF (KOL) which I also used to feature back in autumn, closed shop? Oil is clearly the less problematic energy solution than coal.These are perfect ingredients for an energy storm to hit the States by mid decade. I offer the following chart to whoever might think that oil is overvalued here. It‘s not – it‘s just like all the other commodities, sensing inflation hitting increasingly more.SummaryThe stock market keeps powering higher, and despite the rather clear skies ahead, a bit of short-term caution given the speed of the recovery and its internals presented, is in place. Expect though any correction to be a relatively shallow one – and new highs would follow, for we‘re far away from a top.The gold and silver bulls are staging a return, as last week‘s price damage is being repaired. The signs of a precious metals bull, of a new upleg knocking on the door, abound – patience will be rewarded with stellar gains.Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for both Stock Trading Signals and Gold Trading Signals.Thank you,Monica KingsleyStock Trading SignalsGold Trading Signalswww.monicakingsley.comk@monicakingsley.co* * * * *All essays, research and information represent analyses and opinions of Monica Kingsley that are based on available and latest data. Despite careful research and best efforts, it may prove wrong and be subject to change with or without notice. Monica Kingsley does not guarantee the accuracy or thoroughness of the data or information reported. Her content serves educational purposes and should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks and options are financial instruments not suitable for every investor. Please be advised that you invest at your own risk. Monica Kingsley is not a Registered Securities Advisor. By reading her writings, you agree that she will not be held responsible or liable for any decisions you make. Investing, trading and speculating in financial markets may involve high risk of loss. Monica Kingsley may have a short or long position in any securities, including those mentioned in her writings, and may make additional purchases and/or sales of those securities without notice.
Will Tesla Charge Gold With Energy?

Will Tesla Charge Gold With Energy?

Finance Press Release Finance Press Release 11.02.2021 17:08
Tesla has supported the price of Bitcoin, but it can affect gold as well.The bull market in cryptocurrencies continues. As you can see in the chart below, the price of Bitcoin has recently increased to almost $47,000 (as of February 10). The parabolic rise seems to be disturbing, as such quick rallies often end abruptly.However, it’s worth noting that the price of Bitcoin has partially jumped because of the increased acceptance of cryptocurrencies as a legitimate form of currency by the established big companies. In particular, Elon Musk, the CEO of Tesla, has recently published a series of tweets that significantly affected the price of Bitcoin, Dogecoin, and other cryptocurrencies.Furthermore, Tesla updated its investment policy to include alternative assets as possible investments. In the last 10-k filing to the Securities and Exchange Commission in January 2021, Tesla stated:In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity.Importantly, these assets also include gold :As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds, and other assets as specified in the future.This means that Tesla wants to diminish its position in the U.S. dollar and to diversify its cash holdings. In other words, the company lost some of its confidence in the greenback and started to look for alternatives. So, it seems that Musk and other investors are afraid of expansion in public debt , higher inflation , and the dollar’s debasement .And rightly so! The continued fiscal stimulus will expand the fiscal deficit even further, ballooning the federal debt. With the budget resolution passed last week, only a simple majority will be needed in the Senate to get Biden’s $1.9 trillion package approved, a majority that Democrats have.Remember also that the U.S. economy added only 49,000 jobs in January , while 227,000 jobs were lost in December (revised down by 87,000!). The poor non-farm payrolls will strengthen the odds of a larger fiscal stimulus and easier fiscal and monetary policies.Hence, combined with the ultra-dovish monetary policy and a Fed more tolerant to inflation, the upcoming fiscal support could ultimately be a headwind for the dollar. Initially, the prospect of fiscal support caused positive reactions on the financial markets, but as the euphoria passes, investors start to examine the long-term consequences of easy money and the large expansion of government spending. Importantly, the larger the debt, the deeper the debt trap , and the longer the zero interest rates policy will stay with us, as the Fed won’t try to upset the Treasury.Implications for GoldWhat does Tesla’s move imply for the precious metals market? Well, we are not observing the kind of rally in gold that we are currently witnessing in the cryptocurrencies sphere (see the chart below). And – given the size of the gold market – it’s unlikely that Musk & Co. could ignite a mania similar to the one seen in Dogecoin. The gold market is simply too big. Even the silver market could be too large for similar speculative plays – as the failure of the recent attempt of a short squeeze has shown.However, the update of Tesla’s investment policy is a confirmation of gold as a safe-haven asset and portfolio diversifier . If other big companies follow suit, and we see an actual reallocation of funds from the U.S. dollar towards gold, the price of the yellow metal will get an invigorating electric impulse .If you enjoyed today’s free gold report , we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today . If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today!Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care
5 reasons why people prefer to trade options over stocks

5 reasons why people prefer to trade options over stocks

Chris Vermeulen Chris Vermeulen 13.02.2021 21:13
As technical traders, we know the importance of following the price charts using proven trading strategies and implementing risk and position management. Here at TheTechnicalTraders.com we are stepping things up a notch by adding options to our trading.By using options, a trader can leverage, hedge positions, and generate income via selling premiums. There are basic options, strategies, and complex, and everything in between. Because of that, I have brought options trading specialist Neil Szczepanski to join our team.I will let Neil introduce himself.Hi everyone!  Neil Szczepanski here.  In case you are wondering it is pronounced “Sus’ pan ski".  Yes, I have roots in eastern European ancestry and I’m first generation.  I love options and have been trading them for many, many years. I like options because you have more ways to be profitable in your trading.  I hate putting on a position and then waiting for the market to go your way.  I want to be in control of my trades and options allows for that.  Also, trading can equal freedom. Think about this: imagine having a job that you can do from anywhere on the planet, work as much as you want, and make as much money as you want?  Imagine having that same job that has no boss breathing down your neck and you call the shots. Well, that is what options trading can be like if you have the skills or access to someone who tells you what and when to buy and sell options contracts.You control your own destiny and I have seen traders start with as little as $500.  Options are especially attractive because they can cater to the small guy with smaller accounts via leverage, allowing them to take on big positions with little capital. On the flip side, the more wealthy sophisticated traders use options to protect and hedge positions and can do more complex strategies that provide even more consistent and lucrative returns with lower risk.No matter what category of options trading you fall into, they work incredibly well, and I will teach you while providing professional trades to execute. Over my next few posts, I am going to explain some more about why trading options can be consistently profitable without having to take on huge risks. Today I am going to talk about why I love swing-trading options and the power of leverage that options provide us traders.MAKE BIG MONEY WITH SMALL ACCOUNTSAs I alluded to above, options give the average trader ways to break into the trading world because of leverage. A little capital can go a long way, and if options trading is done properly you can have significantly less risk than buying the stock outright. You can start small, make smart bets that generate returns, and continue building your account through sound risk management techniques like position sizing, etc.For example, when an underlying stock is super expensive, like Telsa for example, it can be prohibitive for the average person just starting out trading to own that stock… let alone 100 shares! Options give you the ability to control those shares for a specific period of time at a fraction of the price. Each individual options contract lets you control 100 shares of Tesla without having to buy the stock.Sign up now to receive information on the launch of the Technical Traders' options trading courses and newsletter!Let us take a look at a simple example where you want to buy TELSA with an expectation that it will go up at least 5% in value in the next month. If you wanted to buy and hold 100 shares of TESLA, then you would need to spend $80,482 to own those shares. Since all we want to do is to be able to sell the shares and lock in the profit when they go up by 5% or more.   We don’t need to own them but rather just have the right to control them within the options contract timeframe. When we hit our targets, we can sell the option contract and take profit (or take possession/delivery of the underlying shares on contract expiry).  This is called option assignment.Below is a sample of a Tesla options chain, where we can see that the price of the stock is $804.82.  Let’s say you could allocate $2,000 to this trade - you would be able to buy almost 2.5 shares of TSLA. But with $2,000, you could buy an option contract at the money that would let you have the right to buy 100 TSLA shares anytime in the next 30 days at a price of $800/share. With options, you have the ability to take your $2,000 trade and have the same controlling interest in an underlying stock as the person that just spent over $80,000 to buy the stock.So to continue with the TSLA example, let’s say on March 12th TSLA was trading for $844 (the 5% gain you were expecting).  If you bought and sold the stock, you would have made a 5% return of $4,000. If you had bought the option, and then take on the assignment (let it expire) you would have the right to buy 100 TSLA shares at $800 and then turn around and sell them for $844.  Your profit would be $4,400 (less the cost of the option contract), a little more profit than had you bought the shares outright. However, if you look at your return it is more than 225% using options!!! Options enable the small players to trade stocks that would normally be outside of their price range, and this is one of the reasons we have seen an increase in options trading popularity over the last year. In fact, options trading volume has more than doubled since the start of the pandemic.Of course, the above trade is a dream, but the reality can be quite scary. If you took the options trade and TSLA dropped below $800, then your liability starts mounting, however, the loss with owning the stock could be over $80,000 while the total loss with buying the options would be the price you paid for the option which is $1,950.  A big reversal of the stock would be catastrophic in both cases but can be much worse for the stock owner.  So it is important to make sure you trade with proper risk management and protections in place. While the adage “with great power there comes great responsibility” was popularized within a different context, I feel it applies to trading options.I know at this point you are probably thinking what the heck is he talking about and options are WAY too complicated for me.  Don’t worry, I’m going to teach and show you in a very simple and easy way how to trade options.  I am also going to provide trades that limit the max loss per trade, and reduce risk so get ready for some excitement!SWING TRADING OPTIONS IS THE PERFECT SIDE-HUSTLEI love teaching, technology, and trading. I knew early on that these were the things that would drive my career path. At the same time, I had kids to feed so I needed to supplement my income to support my growing family. I was able to achieve this through swing trading options. This allowed me to focus on my career and family while making modest yet consistent income, without having to be glued to my screen every day since swing trades last a few days or weeks.We have all seen the traders with 10 monitors looking at charts all day, making trades, and watching and waiting on every single turn in the market.  I can tell you this is NOT my idea of trading.  I prefer swing trading, where I can set up trades to enter and exit every couple of days or even weeks.  Swing trades are meant to be short duration, and they are not intra-day, so you can set up your trades and manage them when you have time to yourself.I once got advice from a great old friend that sometimes it is wise to look at the animal kingdom to learn how we can improve and live our lives.  There is a lot we can learn from the animal kingdom.  Some of the necessities we need as a human being is food shelter, social acceptance, and security.  As such, we should always have back up plans. Going back to the animal kingdom, if we look at say prairie dogs, for example, we know that they always have two holes.  One is for the main entry and exit and the other is for emergency exits.  Side hustles are just that and swing trading can be a really useful back-up/extra income plan.  It is your second hole!Swing trading is also a great way to gain entry into the world of trading.  It is like dipping your toe in the water to test it before you jump in head first.  With swing trading, you can learn all about options and other financial instruments like futures, CFD, and currencies. The best part about swing trading is it can eventually turn into a full-time job, replacing your regular job.  Now, instead of trading during your free time, you can trade when you don’t have to be at work, leaving you with even more time to enjoy life and family. This is the ultimate freedom.  That is what I have done using several strategies that generate consistent, low-risk gains for 20+ years. One of my favorite strategies that I have developed is called the C-LEAP strategy.  In this strategy, you enter and exit positions once every two weeks.  It is one of the least risky strategies I have ever developed, and I use a simple checklist to follow it. I have had past students generate tens of thousands of dollars every month using this strategy, and I have found it to be easy to learn and very consistent.As you may or may not know, I am preparing some options courses where I will teach basic options trading as well as more advanced strategies. Anyone can learn how options work but the most important thing is what strategy you use.  You also need to know how and when to use the right strategy.  I love teaching people how to trade options and live by two principles when doing so: “Trading can be simple but it is not easy” and "I want EVERYONE to win not just me and in fact, I have no desire to win if everyone else loses.". I am really excited to get to know some of you soon when I launch my LIVE options courses and get you on the path to winning trades!I will also be running The Technical Traders' new service – Options Trading Signals – where I will share my knowledge, model portfolio, a weekly trade, and opportunities report, and trade alerts with subscribers. Look for the launch of my newsletter and courses at the end of February! Make sure you sign up now to keep informed of the launch of my newsletter and courses. You can sign up at www.thetechnicaltraders.com/options-trading.In the next article Neil will keep giving you reasons to love trading options, including how you can trade options with less risk than stocks, how you can better react to volatility with options compared to stocks, and how you can attain consistent profits with lower drawdowns by trading options. So come along with me for the ride and change your life with a new skill trading options!All my best,
Mark Cuban: Ethereum Better Than Bitcoin as Store of Value

Mark Cuban: Ethereum Better Than Bitcoin as Store of Value

BeInCrypto (BeIn News Academy Ltd), we're writing about crypto. BeInCrypto (BeIn News Academy Ltd), we're writing about crypto. 14.02.2021 19:54
TV personality and investor Mark Cuban thinks Ethereum might be a better store of value than Bitcoin. Shark Tank: Ethereum vs Bitcoin In a recent podcast with DeFi blog The Defiant, billionaire investor Mark Cuban suggests Ethereum (ETH) could be the future of stores of value. Cuban, famous for his appearance on the television series Shark Tank, says cryptocurrency’s second token could even outdo Bitcoin (BTC) in that area. Cuban’s comments surprise few who know him. He questioned BTC in the past, and called its price surges bubble-like. Moreover, the sports billionaire also made clear in the podcast his excitement for smart contracts. More generally, however, Cuban is a fan of cryptocurrency. He instructed his basketball team, the Dallas Mavericks, to accept cryptocurrency payments. Moreover, in a recent ask-me-anything (AMA) on Reddit, Cuban revealed his cryptocurrency holdings, which include decentralized finance project Aave (AAVE). The Celebrity Effect Cuban isn’t the only celebrity or billionaire for that matter with a keen interest in the cryptocurrency and blockchain space. As has been thoroughly covered, Tesla’s Elon Musk is an enthusiastic participant in the cryptocurrency world. The eccentric billionaire owner of SpaceX tweets on cryptocurrency’s own everlasting meme, Dogecoin (DOGE). Last year, when Musk tweeted “One word: Doge”, the canine-themed cryptocurrency leapt over 1000%. Indeed, the continuous tweeting by the billionaire on the topic of cryptocurrencies led to a study that looked at the effects of those tweets on crypto-prices. Unsurprisingly, the study found a significant “abnormal effect” by Musk on both DOGE and BTC. Musk’s popularization of cryptocurrencies on Twitter even led to a number of other celebrities, Snoop Dogg among them, endorsing DOGE, approving its mainstream meme status. A New Class Although celebrities potentially treat cryptocurrency space as a vehicle for entertainment, a new class of cryptocurrency owning business is seriously investing in the space. Take MicroStrategy, for example. The business analytics firm made headlines in December for its bid to raise $600 million, all of which was destined for BTC. Recently, it purchased $10 million worth of the top-cryptocurrency in one go. Moreover, Musk’s own Tesla recently revealed in a filing that it scooped up $1.5 billion worth of BTC in January. Celebrities tend to follow the popular culture and vice versa. When Cuban, Musk and Snoop Dogg show interest in the industry, investment advice aside, they reflect public interest. As Bitcoin currently hovers under $50,000, more will likely have something to say. The post Mark Cuban: Ethereum Better Than Bitcoin as Store of Value appeared first on BeInCrypto.
Stocks, Gold – Rebound or Dead Cat Bounce?

Stocks, Gold – Rebound or Dead Cat Bounce?

Monica Kingsley Monica Kingsley 01.03.2021 15:10
None of Friday‘s intraday attempts to recapture 3,850 stuck, and the last hour‘s selling pressure is an ill omen. Especially since it was accompanied by high yield corporate bondsh weakening. It‘s as if the markets only now noticed the surging long-end Treasury yields, declining steeply on Thursday as the 10y Treasury yield made it through 1.50% before retreating. And on Friday, stocks didn‘t trust the intraday reversal higher in 20+ year Treasuries either.Instead, the options traders took the put/call ratio to levels unseen since early Nov. The VIX however doesn‘t reflect the nervousness, having remained near Thursday‘s closing values. Its long lower knot looks encouraging, and the coming few days would decide the shape of this correction which I have not called shallow since Wed‘s suspicious tech upswing. Here we are, the tech has pulled the 500-strong index down, and remains perched in a precarious position. Could have rebounded, didn‘t – instead showing that its risk-on (high beta) segments such as semiconductors, are ready to do well regardless.That‘s the same about any high beta sector or stock such as financials – these tend to do well in rising rates environments. Regardless of any coming stabilization / retreat in long-term Treasury yields, it‘s my view that we‘re going to have to get used to rising spreads such as 2y over 10y as the long end still steepens. The markets and especially commodities aren‘t buying Fed‘s nonchalant attitude towards inflation. Stocks have felt the tremors, and will keep rising regardless, as it has been historically much higher rates that have caused serious issues (think 4% in 10y Treasuries).In such an environment, the defensives with low volatility and good earnings are getting left behind, as it‘s the top earners in growth, and very risk-on cyclicals that do best. They would be taking the baton from each other, as (micro)rotations mark the stock market bull health – and once tech big names join again, new highs would arrive. Then, the $1.9T stimulus has made it past the House, involves nice stimulus checks, and speculation about an upcoming infrastructure bill remains. Coupled with the avalanche of new Fed money, this is going into the real economy, not sitting on banks‘ balance sheets – and now, the banks will have more incentive to lend out. Margin debt isn‘t contracting, but global liquidity hasn‘t gone pretty much anywhere in February. Coupled with the short-term dollar moves, this is hurting emerging markets more than the U.S. - and based on the global liquidity metrics alone, the S&P 500 is oversold right now – that‘s without the stimulus package. It‘s my view that we‘re experiencing a correction whose shape is soon to be decided, and not a reversal of fortunes.Just like I wrote at the onset of Friday:(…) Would we get a bounce during the U.S. session? It‘s possible to the point of likely. The damage done yesterday though looks to have more than a few brief sessions to run to repair. True, some stocks such as Tesla are at a concerning crossroads, and in general illustrate the vulnerability of non-top tech earners within the industry. Entering Mon‘s regular session, the signs are mixed as there hasn‘t been a clear reversal any way I look at it. Still, this remains one of the dips to be bought in my view – and the signs of it turning around, would be marked by strengthening commodities, and for all these are worth, copper, silver and oil especially.As for gold, it should recover given the retreating long-term yields, but Fri didn‘t bring any signs of strength in the precious metals sector, to put it mildly. Look for TLT for directions, even as real rates, the true determinant, remain little changed and at -1%, which means very favorable fundamentals for the yellow metal. And remember that when the rate of inflation accelerates, rising rates start to bite the yellow metal less.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Its InternalsFriday‘s session doesn‘t have the many hallmarks of a reversal. Slightly higher volume, yet none of the intraday upswings held. The Force index reveals that the bears just paused for a day, that there wasn‘t a true reversal yet. The accumulation is a very weak one thus far, and the sellers can easily show more determination still.Credit MarketsHigh yield corporate bonds (HYG ETF) are plain and simple worrying here. The decent intraday upswing evaporated as the closing bell approached. A weak session not indicative of a turnaround.The high yield corporate bonds to short-dated Treasuries (HYG:SHY) performance was weaker than the stock market performance, which isn‘t a pleasant development. Should the bond markets keep trading with a more pessimistic bias than stocks, it could become quite fast concerning. As said already, the shape of the correction is being decided these days.Stocks, Smallcaps and Emerging MarketsAfter having moved hand in hand, emerging markets (EEM ETF) have weakened considerably more over the prior week than both the S&P 500 and the Russell 2000 (IWM ETF). EEM is almost at its late Jan lows – given Fri‘s spike, watching the dollar is key, and not just here.TechnologyTechnology (XLK ETF) didn‘t reverse with clarity on Friday, regardless of positive semiconductors (XSD ETF) performance. At least the volume comparison here is positive, and indicates accumulation. Just as I was highlighting the danger for S&P 500 and gold early Thursday, it‘s the tech sector that holds the key to the 500-strong index stabilization.Gold and SilverReal rates are deeply negative, long-dated Treasuries indeed turned higher on Friday, yet gold plunged right to its strong volume profile support zone before recovering a little. Its very short-term performance is disappointing, It was already its Tue performance that I called unconvincing – let alone Wed‘s one. I maintain that it‘s long-dated Treasury yields and the dollar that are holding the greatest sway. Rates should retreat a little from here, and the gold-dollar correlation is only slightly positive now, which translates into a weak positive effect on gold prices.But it‘s silver that I am looking to for earliest signs of reversal – the white metal and its miners have the task clear cut. Weeks ago, I‘ve been noting the low $26 values as sufficient to retrace a reasonable part of prior advance, and we‘ve made it there only this late. Thu and Fri‘s weakness has much to do with the commodities complex, where I wanted still on Thu to see copper reversing intraday (to call it a risk-on reversal), which it didn‘t – and silver suffered the consequences as well. Likewise now, I‘m looking to the red metal, and will explain in today‘s final chart why.Precious Metals RatiosThere is no better illustration of gold‘s weakness than in both miners to gold ratios that are bobbing around their local lows, rebounding soundly, and then breaking them more or less convincingly again. The gold sector doesn‘t yet appear ready to run.Let‘s get the big picture through the copper to oil ratio. Its current 8 months long consolidation has been punctured in the middle with oil turning higher, outperforming the red metal – and that brought the yellow one under pressure increasingly more. Yet is the uptick in buying interest in gold a sign of upcoming stabilization and higher prices in gold that Fri‘s beaten down values indicate? Notably, the copper to oil ratio didn‘t break to new lows – and remains as valuable tool to watch as real, nominal interest rates, and various derivatives such as copper to Treasury yields or this very ratio.SummaryStock bulls are almost inviting selling pressure today with the weak finish to Fri‘s session. While the sectoral comparisons aren‘t disastrous, the credit markets indicate stress ahead just as much as emerging markets do. Still, this isn‘t the end of the bull run, very far from it – new highs are closer than quite a few might think.Gold and silver took an even greater beating on Fri than the day before. Naturally, silver is much better positioned to recapture the higher $27 levels than gold is regarding the $1,800 one. With the long-dated Treasuries stabilization indeed having resulted in a short-term dollar upswing, the greenback chart (and its effects upon the metals) is becoming key to watch these days. Restating the obvious, gold is far from out of the woods, and lacking positive signs of buying power emerging.
Stocks Shaking Off Weak Tech As Gold Bottoms?

Stocks Shaking Off Weak Tech As Gold Bottoms?

Monica Kingsley Monica Kingsley 09.03.2021 15:28
Stocks spiked higher, but not before going sideways to down prior on the day. And the close to the session hasn‘t been convincing either – does it count as a reversal? In my view, we haven‘t seen one yesterday really, regardless of this correction not being over just yet. There are still some cracks I tweeted yesterday about in need closing first, such as the worrying corporate bonds performance, manifest in the HYG:SHY ratio, or the tech searching for the bottom (it‘s $NYFANG precisely). Quoting from yesterday‘s extensive analysis spanning beyond stocks, metals and the Fed:(…) Stocks have had a great run over the past 4 months, getting a bit ahead of themselves in some aspects such as valuations. Then, grappling with the rising long-term rates did strike.So did inflation fears, especially when looking at commodities. Inflation expectations are rising, but not galloping yet. What to make of the rising rates then? They‘re up for all the good reasons – the economy is growing strongly after the Q4 corona restrictions (I actually expect not the conservative 5% Q1 GDP growth, but over 8% at least) while inflation expectations are lagging behind. In other words, the reflation (of economic growth) is working and hasn‘t turned into inflation (rising or roughly stable inflation expectations while the economy‘s growth is slowing down). We‘re more than a few quarters from that – I fully expect really biting inflation (supported by overheating in the job market) to be an 2022-3 affair. As regards S&P 500 sectors, would you really expect financials and energy do as greatly as they do if the prospects were darkening?Stocks are well positioned to keep absorbing the rising nominal rates. What has been the issue, was the extraordinarily steep pace of such move, leaving long-term Treasuries trading historically very extended compared to their 50-day moving averages. While they can snap back over the next 1-2 weeks, the 10y Treasury bond yield again breaking 1.50% is a testament to the Fed not willing to do anything at the moment. Little does the central bank care about commodities moves, when it didn‘t consider any market moves thus far as unruly.Gold market offered proof of being finally ready for a rebound, and it‘s visible in the closing prices of the yellow metal and its miners. Being more than a one day occurence, supported by yesterday presented big picture signals, the market confirmed my yesterday‘s suggestion of an upcoming gold. It appears we‘ll get more than a few days to assess the legs this rally is made of, facilitating nimble charting of the waters ahead my usual way:(…) Just as I was calling out gold as overheated in Aug 2020 and prone to a real soft patch, some signs of internal strength in the precious metals sector were present this Feb already. And now as we have been testing for quite a few days the first support in my game plan, we‘re getting once again close to a bullish formation that I called precisely to a day, and had been banging the bearish gold drum for the following two days, anticipating the downside that followed. Flexibility and broad horizons result in accentuated, numerous other portfolio calls – such as long Bitcoin at $32,275 or long oil at $58 practically since the great return with my very own site. We‘re now on the doorstep of visible, positive price outperformance in the gold miners (GDX ETF) as gold prices didn‘t break the higher bullish trend by declining through both the Mar 4 presented supports of my game plan. As I wrote yesterday, if prices move higher from here, they have simply bounced off support, especially given the accompanying signs presented, not the least of which is the dollar getting back under pressure. Make no mistake, the greenback isn‘t in a bull market – it‘s merely consolidation before plunging to new 2021 lows. I have not been presenting any USDX declining resistance lines and breakout arguments, because prices can be both above such a line, and lower than at the moment of „breakout“ at the same time – ultimately, rising and declining supports and resistances are a play on the speed of the move, where pure inertia / deceleration / reprieve doesn‘t break the prior, higher trend. And as I called in summer 2020 the dollar to roll over and keep plunging, that‘s still what‘s unfolding.How does it tie in to commodities and stocks? We‘re not at extreme moves in either, and I see copper, iron, oil, agrifoods as benefiting from the reflationary efforts greatly. Similarly and in spite of the $NYFANG travails, it would be ill-advised to search for stock market tops now (have you seen how well the Dow Industrials is doing?) – no, we‘re not approaching a top that I would need to call the way I did in the early Sep buying climax. This is still the time to be running with the herd, and not against it – you can ignore the noise to the contrary for both the S&P 500 and commodities have a good year ahead. As for precious metals, we might have seen the bottom already – and in any case by the current shape of things, I don‘t see it occuring quarters ahead and hundreds buck lower.Bringing up the constant reevaluation of position‘s rationale, market reactions and narratives:(…) It‘s the markets‘ discounting mechanism of the future that counts – just as gold cleared the deflationary corona crash in psring 2020, just as it disregarded the tough Fed tone of 2H 2018, just as it sprang vigorously higher in early 2016 stunning bears in all three cases with sharp losses over many months, or just as stocks stopped declining well before economic news got better in April 2020 or March 2009. Make no mistake, the markets consider transitioning to a higher inflation environment already now (the Fed timidly says that reopening will spike it, well, temporarily they say), when inflation expectations are still relatively low, yet peeking higher based on the Fed‘s own data. Gold is in a secular bull market that started in 2018 (if not in late 2015), and what we‘re seeing since the Aug 2020 top, is the soft patch I called. The name of the game now, is where the downside stops – and it‘s one of the scenarios that it has just happened, especially if gold convincingly closed back above $1,720 without undue delay.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookWe have seen two intraday reversals to the downside yesterday, yet I think the effects would prove a temporary obstacle to the bulls only. Such candlestick patterns usually slow down the advance, but don‘t end it – and that‘s consistent with my yesterday‘s words of most of the downside being already in. Once the 3,900 zone is confidently passed, the bears would have missed the chance to reach below Thursday‘s lows.Credit MarketsHigh yield corporate bonds (HYG ETF) still ilustrate ongoing fragility for they have plunged below their Feb lows. This correction doesn‘t appear to be as totally over just yet, also given the sectoral picture that I am showing you next.Put/Call Ratio and VolatilityOption players clearly aren‘t concerned by yesterday‘s S&P 500 price action, and the VIX is painting a similarly neutral picture – just as the sentiment overall. Very good, we‘re primed to go higher next, from a starting position far away from the extreme greed levels.Technology and ValueThe sectoral divergence continues, and tech is still the weakest link in the whole S&P 500 rebound. The big $NYFANG names, the Teslas of this world, are the biggest drag, and not until these carve out a sustainable bottom (this needn‘t happen at the 200-day moving average really), I can declare this correction as getting close to over. It‘s the cyclicals, it‘s value stocks that is pulling the 500-strong index ahead, with financials (XLF ETF), industrials (XLI ETF) and energy (XLE ETF) leading the charge.Treasuries and DollarNominal, long-term Treasury rates have at least slowed their quickening Feb pace, even in the face of no action plan on the table by the Fed – the dollar moved higher on the realization next, and it‘s my view that once new Fed intervention is raised, it would have tremendous implications for the dollar, and last but not least – the precious metals.Gold and SilverFinally, this is the much awaited sign, enabling me to sound some bullish tone in gold again – the miners are outperforming the yellow metal with more than a daily credibility, which I view as key given the lackluster gold price action before yesterday (absence of intraday rebounds coupled with more downside attempts). It would turn stronger once the gold juniors start outperforming the seniors, which is not the case yet.Coupled with the 4-chart big picture view from yesterday, it‘s my view that the gold market is laying the groundwork for its turning:(…) Real rates are negative, nominal rates rose fast, and inflation expectations have been trending higher painfully slowly, not reflecting the jump in commodities or the key inflation precursor (food price inflation) just yet – these are the factors pressuring gold as the Fed‘s brinkmanship on inflation goes on. Once the Fed moves to bring long-term rates under control through intervention – hello yield curve control or at least twist – then real rates would would be pressured to drop, which would be a lifeline for gold – the real questions now are how far gold is willing to drop before that, and when that Fed move would happen. Needless to add as a side note regarding the still very good economic growth (the expansion is still young), stagflation is what gold would really love.Silver is carving out a bottom while both copper and platinum are turning higher already – these are That‘s the essence of one of my many profitable plays presented thus far – long silver short gold spread – clearly spelled out as more promising than waiting for gold upswing to arrive while the yellow metals‘ bullish signs have been appearing through Feb only to disappear, reappear, and so on.SummaryStocks haven‘t seen a real reversal yesterday, but more backing and filling till the tech finds bottom, appears due. The medium-term factors favor the bulls, but this correction isn‘t over yet, definitely not in time.Now, gold can show some strength – and silver naturally even more. The signs overall favoring a rebound, are appearing with increasing clarity for the short term, and the nearest weeks will show whether we have made a sustainable bottom already, or whether the $1,670 zone will get tested thoroughly. The bulls have the upper hand now.
That’s Why You Buy the Dips

That’s Why You Buy the Dips

Finance Press Release Finance Press Release 10.03.2021 14:41
Days like Tuesday (Mar. 9) are why you buy the dips. It was nothing short of a reverse rotation from what we’ve seen as of late. Bond yields moved lower; tech stocks popped.That’s why I called BUY on the Nasdaq.Inflation fears and the acceleration of bond yields are still a concern. But it looks as if things are stabilizing, at least for one day. The lesson here, though, is to be bold, a little contrarian, and block out the noise.Unless you’ve been living under a rock, you know that recent sessions have been characterized by accelerating bond yields driving a rotation out of high growth tech stocks into value and cyclical stocks that would benefit the most from an economic recovery. The Nasdaq touched correction territory twice in the last week and gave up its gains for the year.But imagine if you bought the dip as I recommended.The Nasdaq on Tuesday (Mar. 9) popped 3.7% for its best day since November. Cathie Wood’s Ark Innovation ETF (ARKK) surged more than 10% for its best day ever after tanking by over 30%. Semiconductors also rallied 6%.Other tech/growth names had themselves a day too: Tesla (TSLA) +20%, Nvidia (NVDA) +8%, Adobe (ADBE) +4.3%, Amazon +3.8%, Apple (AAPL) +4.1%, and Facebook (FB) +4.1%.In keeping with the theme of buying the dip, do you also know what happened a year ago yesterday to the date? The Dow tanked 7.8%!There’s no way to time the market correctly. If you bought the Dow mirroring SPDR DJIA ETF (DIA) last March 9, you’d have still seen two weeks of pain until the bottom. However, you’d have also seen a gain of almost 36% if you bought that dip and held on until now.Look, I get there are concerns and fears right now. The speed at which bond yields have risen is concerning, and the fact that another $1.9 trillion is about to be pumped into a reopening economy makes inflation a foregone conclusion. But let’s have a little perspective here.Bond yields are still at a historically low level, and the Fed Funds Rate remains 0%.So is the downturn overblown and already finished?Time will tell. I think that we could still see some volatile movements over the next few weeks as bond yields stabilize and the market figures itself out. While I maintain that I do not foresee a crash like what we saw last March and feel that the wheels remain in motion for an excellent 2021, Mr. Market has to figure itself out.A correction of some sort is still very possible. I mean, the Nasdaq’s already hit correction territory twice in the last week and is still about 3-4% away from returning to one. But don’t fret. Corrections are healthy and normal market behavior. Only twice in the last 38 years have we had years WITHOUT a correction (1995 and 2017).Most importantly, a correction right now would be an excellent buying opportunity. Just look at the Nasdaq Tuesday (Mar. 9).It can be a very tricky time for investors right now. But never, ever, trade with emotion. Buy low, sell high, and be a little bit contrarian. There could be some more short-term pain, yes. But if you sat out last March when others bought, you are probably very disappointed in yourself. Be cautious, but be a little bold too.You can never time the market.My goal for these updates is to educate you, give you ideas, and help you manage money like I did when I was pressing the buy and sell buttons for $600+ million in assets. I left that career to pursue one to help people who needed help instead of the ultra-high net worth.With that said, to sum it up:There is optimism but signs of concern. The market has to figure itself out. A further downturn is possible, but I don’t think that a decline above ~20%, leading to a bear market, will happen any time soon.Hopefully, you find my insights enlightening. I welcome your thoughts and questions and wish you the best of luck. Nasdaq- That’s Why I Called BUYFigure 1- Nasdaq Composite Index $COMPFor the second time in a week, the Nasdaq hit correction territory and rocketed out of it. It saw its best day since November and proved once again that with the Nasdaq, you always follow the RSI. There could be more uncertainty over the next few weeks as both the bond market and equity market figure themselves out. However, the Nasdaq declines were very buyable, as I predicted.If you bought the dip before Tuesday’s (Mar. 9) session, good on you. Be a little bit bold and fearless right now. Take Ark Funds guru Cathie Wood, for example. Many old school investors scoffed at her comments on Monday (Mar. 8) after she practically doubled down on her bullishness for her funds and the market as a whole. After crushing 2020, her Ark Innovation Fund (ARKK) tanked over 30%. Many called her the face of a bubble. Many laughed at her.Tuesday, March 9, ARKK saw its best day in history.I’m not saying that we’re out of the woods with tech. All I’m saying is don’t try to time the market, don’t get scared and have perspective.The Nasdaq is once again roughly flat for the year, its RSI is closer to oversold than overbought, and we’re still below the 50-day moving average, near a 2-month low, and right around support at 13000.It can’t hurt to start nibbling now. There could be some more short-term pain, but if you waited for that perfect moment to start buying a year ago when it looked like the world was ending, you wouldn’t have gained as much as you could have.I think the key here is to “selectively buy.” I remain bullish on tech, especially for sub-sectors such as cloud computing, e-commerce, and fintech.Mike Wilson , chief investment officer at Morgan Stanley, had this to say about recent tech slides- “I don’t think this is the end of the bull market or the end of tech stocks per se, but it was an adjustment that was very necessary.”I like the levels we’re at, and despite the possibility of more “adjustments” in the short-run, it’s a good time to BUY. But just be mindful of the RSI, and don’t buy risky assets. Find emerging tech sectors or high-quality companies trading at a discount.For an ETF that attempts to correlate with the performance of the NASDAQ directly, the Invesco QQQ ETF (QQQ) is a good option.For more of my thoughts on the market, such as when small-caps will be buyable, more thoughts on inflation, and emerging market opportunities, sign up for my premium analysis today.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Matthew Levy, CFA Stock Trading Strategist Sunshine Profits: Effective Investment through Diligence & Care* * * * *All essays, research, and information found above represent analyses and opinions of Matthew Levy, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Matthew Levy, CFA, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Levy is not a Registered Securities Advisor. By reading Matthew Levy, CFA’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading, and speculation in any financial markets may involve high risk of loss. Matthew Levy, CFA, Sunshine Profits' employees, and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Stocks: big moves!

Stocks: big moves!

Kseniya Medik Kseniya Medik 31.03.2021 11:05
Stepping up the ladder to 4000 The stock market keeps steadily going upwards towards the mark of 4000. While there have been and will be inevitable dropdowns below the support of the 50-MA, the overall trend is a clear uptrend. What's important is that the recent turbulence was not as high as the one in September-October - that's a sure sign of true recovery and stabilization of the economy seen in the corporate environment. Having that as a background, let's review particular stocks now. Tweeting down No one can deny Elon Musk the liberty to say whatever he finds necessary on Twitter. That doesn't mean it does any good to the valuation of Tesla, though. Sometimes we may even think that he does it intentionally like that time when he said that Tesla's value is too high - and the stock dropped. The announcement that Tesla may be bought with Bitcoins didn't prevent the stock price from going down. Partially, because of another controversial tweet about unions that the US authorities are considering as a possible threat to labor union participants. On the other side, there was another comment that Elon Musk tweeted - and eventually deleted is that very soon, Tesla may weigh more than Apple. Whatever there is, the support of 550 is there, and it may be reached again. At the same time, a bounce upwards is also possible. For this reason, if you're considering taking a rather risky mid-term position, you may think of buying Tesla - that's if you're ready to hold out enough time until it starts recovering. Because when it does, then from the current $600 to the all-time high of $900 it's a 50% value growth potential. Chinese affairs Alibaba is now under double pressure. First, Jack Ma's company is under direct pressure, scrutiny, and counteraction from the side of the Chinese authorities. Second, strategically, global geopolitical tension between China and the "Western world" growing around the Uyghur region is making the future of Alibaba even more cloudy than it is now. In any case, the stock is now at nine-month lows. Moreover, it trades above the support zone of 215-220. Technically, a bounce upwards is very possible. If it happens, then there is the entire $100 above to meet the all-time high again. Potentially, it's an almost 50% value gain possibility - that may take a few months, though. Therefore, Alibaba may be a risky buy for a long-term strategy. Or, observe it further as fundamentally, grounds are shaking beneath Jack Ma's feet. Beating everyone Shooting up from $50 to $54, Coca-Cola performed as well as never since the start of the recovery. Definitely, it's one of the best performers of the S&P 500 so far. Fundamentally, it has a very good business outlook. Sales are going better and better, most observers suggest it's a buy stock - for a long-term scenario. For the short-term, though, you have to take into account that this growth was really aggressive. Not that it never happens in the stock market but this stock has been oscillating between the two sides of the indicated channel since March. Currently, it's in an upswing. However, observe it closely as it approaches $55. At or slighly above that mark, it may reverse to do a technical correction - in this case, it may go all the way down to $51-52. Therefore, observe possible reversal pattern in the shotrt-term - they may occur at any time. Remember that you can trade stocks not only through Metatrader 5 but also through the FBS Trader app!
Morgan Stanley: you risk if you don’t have Tesla stock

Morgan Stanley: you risk if you don’t have Tesla stock

Kseniya Medik Kseniya Medik 08.04.2021 14:38
Morgan Stanley, a huge investment bank, has warned investors about a “risk” not having Tesla stock. It means that those people who don’t have Tesla shares will regret it as Musk’s company will continue increasing its value. Why is Morgan Stanley so sure about Tesla’s growth? The key reason is Biden’s infrastructure plan, which is positive for Tesla. The US President intends to fight climate change and make the USA carbon-free by 2050. He will spend $174 billion to develop the US electric-vehicle ecosystem, where Tesla is the top performer. “Auto investors face greater risk not owning Tesla shares in their portfolio than owning Tesla shares in their portfolio.” However, Morgan Stanley cautioned that Tesla’s way up won’t be easy and fast. Indeed, this year the carmaker is down about 5%, which is not so bad actually. It can be viewed as a great opportunity for investors to buy Tesla at a lower price. In comparison, Tesla rose 743% last year. So, there is a high chance Tesla will catch up. By the way, last week, Musk’s company has published better-than-expected car deliveries even despite the global chip shortage. Forecasts Morgan Stanley set a price target for Tesla at $880. According to Bloomberg, the average analysts’ target is $651, with 17 buy recommendations, 13 holds, and 12 sells. Technical analysis Tesla has formed the ascending triangle pattern. The ascending triangle pattern shows that bulls are getting stronger. As a result, its slope goes up. If the price manages to break the high of April 5 at $708.00, the way up further to the next round number of $750.00 will be open. In the opposite scenario, the move below the low of March 31 at $640.00 will drive Tesla down to the lower trend line at $600.00. You can trade stocks in the FBS Trader app or in MetaTrader 5!
The Curious Staircase Rally in Stocks

The Curious Staircase Rally in Stocks

Monica Kingsley Monica Kingsley 09.04.2021 15:58
Another day of tiny S&P 500 gains defying gravity, boosted by overnight price action. Well, liquidity overpowering junk corporate bonds opening with a bullish gap only to partially close it. With some credit market hints at deterioration present, the yen carry trade is getting a new lease on life today, and that‘s generally bullish for risk-on assets such as stocks – but not really for precious metals.With all the Fed support, the Powell bid is in, affecting „traditional“ sectoral dynamics of rotation. Value is probably about to feel the heat if you look at the very long lower knot in financials (XLF ETF) yesterday. Yes, this interest rate sensitive sector still rose in the face of long-dated Treasuries‘ gains. Needless to say, technology loved that, and its heavyweights ($NYFANG) keep driving the sector up. It looks to be a question of time before Tesla (TSLA) joins – Square (SQ) already did.The key question is the rotation‘s degree – now that the yields appear ready to retreat still a little more (the 10-year yield appears targeting the low 1.50% figure if not declining further), which is what technology anticipates even though utilities and consumer staples have been dragging their feet a little lately. But value stocks aren‘t selling off in the least (yet?). Is the TINA still strongly in effect when those stock market segments that could have been expected under more stringent monetary policy to be sold, aren‘t no more? Rising tide lifting really all boats – in stocks.Gold has retreated from yesterday‘s almost $1,760 highs accompanied by continued miners‘ outperformance. That‘s likely on account of the yen getting under pressure today, even though gold defended the Mar 08 bottom in spite of $USDJPY peaking in the closing days of Mar. The yellow metal is still sensitively reacting to the nominal yield moves, which are serving as a tailwind – both in the short run and when you zoom out and add copper into the picture (final chart of yesterday‘s analysis).One of the key things that I am still waiting for before declaring the gold bottom to be absolutely in, is its run above the key $1,760s or even better above $1,775 level. Let‘s though first watch for the miners not running out of steam.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookS&P 500 keeps hugging the upper border of Bollinger Bands, yet the willingness to trade at these extended levels has slightly returned yesterday. Hard to time any bear raid in these circumstances really.Credit MarketsVery tight correlation indeed as the high yield corporate bonds to short-dated Treasuries (HYG:SHY) ratio keeps tracking the stock market moves. Not even the HYG volume picked up yesterday, making it impossible to call for a turnaround as investment grade corporate bonds (LQD ETF) keep rising in sympathy with TLT.Technology and ValueTech (XLK ETF) sprang to new highs on TLT erasing its Wednesday‘s losses while value again kept gained ground. Broad-based advance not pointing to much downside really unless $NYFANG turns in earnest.Gold and SilverGold turned strongly higher on the retreat in rising nominal yields (even as inflation expectations ticked lower yesterday) and the yen tailwind, but the volume behind the rally off the second imperfect bottom, is quite weak overall (concerning).Silver joined in yesterday‘s party, and both copper and platinum moved higher as well. Seeing the white metal not spiking yesterday is actually a positive sign of the precious metals upswing health, daily woes notwithstanding.Crude OilPrecious few directional signals in oil, yet higher prices are still favored by the oil index ($XOI). This consolidation is still relatively young, and not even a crash to roughly $52.50 would break the uptrend.SummaryS&P 500 keeps consolidating in a vulnerable and stretched position, yet offers no signs of an immediate retracement of a portion of prior gains. The current setup is unfavorable for short-term oriented (bullish leaning) traders who prefer higher signal clarity to the tight correlation we‘ve seen this week.After yesterday‘s fireworks, miners hold the key in today‘s session as the $1,760s are still a tough nut to crack – the precious metals‘ upswing health will be tested.
Stocks or Gold – Which Is in the Catbird Seat?

Stocks or Gold – Which Is in the Catbird Seat?

Monica Kingsley Monica Kingsley 12.04.2021 15:13
S&P 500 spurted higher after prior days of tiny gains. Still lining up the upper border of the Bollinger Bands on the daily chart, stocks keep defying gravity. But the corporate credit markets are sending a gentle warning sign as they failed to move higher in unison on Friday. Given the Fed support and liquidity injections talked on Friday:(…) the Powell bid is in, affecting „traditional“ sectoral dynamics of rotation. Value is probably about to feel the heat if you look at the very long lower knot in financials (XLF ETF) yesterday. Yes, this interest rate sensitive sector still rose in the face of long-dated Treasuries‘ gains. Needless to say, technology loved that, and its heavyweights ($NYFANG) keep driving the sector up. It looks to be a question of time before Tesla (TSLA) joins – Square (SQ) already did.The spanner in the works proved to be long-dated Treasuries as these gave up all intraday gains, and closed in a non-bullish fashion. The retreat in rising yields is running into headwinds, much sooner than the 10-year one could reach the low 1.50% figure at least. Value stocks and cyclicals such as financials appear calling it out, and both rose on Friday – and so did industrials and technology, all without tech heavyweights‘ help. Utilities and consumer staples went mostly sideways, disregarding the danger of yields about to rise again.The rotation simply isn‘t much there, and the TINA trade isn‘t letting much air to come out of the S&P 500 sectors that would be expected to sell off in a more relaxed monetary policy. Treasury holders keep demanding higher rates, disregarding the soft patch in inflation expectations since mid-Mar. And they‘re right in doing so, for the PPI missed badly on Friday – the development I had been anticipating since mid-Feb.Inflation in the pipeline is one of the reasons behind gold‘s resilience – and its continued rebound off the imperfect double bottom test.While the yellow metal‘s candlestick on Friday mirrors the USD/JPY one, the miners erased opening losses in a bullish show of outperformance. Given the continued consolidation in commodities keeping a partial lid on silver, that‘s bullish – gold appears sensing the upcoming pressure on the Fed to act once yields reach levels high enough to cause havoc across the markets, starting with stocks, just as I described on Mar 29.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 Outlook and Its InternalsS&P 500 keeps pushing higher, into the upper border of Bollinger Bands that are now widening. Taking into account prior week‘s Easter-shortened trading, the weekly volume behind the upswing just in, is considerably lower than before – and that‘s not bullish.Market breadth indicators aren‘t arrayed in an overly bullish way. Both the advance-decline line and advance-decline volume have been lately unconvincing, but at least new highs new lows turned up. They‘re still below the early April peak, revealing that not as many stocks are pushing to make new highs.Credit MarketsVery tight correlation between the high yield corporate bonds to short-dated Treasuries (HYG:SHY) ratio and the stock market ended on Friday, and it remains to be seen whether that was a one day occurence only. Investment grade corporate bonds (LQD ETF) gave up half of intraday gains as long-dated Treasuries declined – the downward pressure appears returning into the debt markets.Technology and FinancialsTech (XLK ETF) turned from the sector most heavily extended to the south of its 50-day moving average, to the north of it. And given the hesitation a ka reversal in TLT reflecting upon $NYFANG, the sector‘s steep gains are likely to meet a headwind soon – and value stocks appear to be anticipating that with an upswing of their own, reflected in the financials (black line).Inflation ExpectationsInflation expectations as measured by the TIP:TLT ratio are basing, but bond yields refuse to budge, clearly agreeing that there is higher inflation coming. Gold and SilverGold miners are keeping the sector above water, and the daily gold downswing becomes much less credible as a result.Silver and copper daily downswings are in line with the gold one – there is no indication of a pocket of underperformance in commodities or elsewhere about to spill over and exert pressure on the precious metals sector.SummaryS&P 500 upswing is leaving the index in a vulnerable position, and especially the tech‘s reversal is leaving it in a perched place where no sector is however being really sold off. The current setup is still unfavorable for short-term oriented (bullish leaning) traders who prefer higher signal clarity to the tight correlation we‘ve seen this week, even more so given the corporate credit markets non-confirmation.Miners did their job on Friday, and the precious metals upswing hasn‘t lost its spark in spite of both metals closing down. The $1,760s are still a tough nut to crack, but I look for these levels to be challenge in the near future.
Still a Bullish Fever in Stocks?

Still a Bullish Fever in Stocks?

Monica Kingsley Monica Kingsley 13.04.2021 15:46
S&P 500 went nowhere yesterday – just like the prior Monday, heavy buying into Friday‘s close met no follow-up the day after. After almost touching 16 to close the week, VIX peeked higher yesterday only to reverse back down. Nice try but if you look at the put/call ratio turning down simulatenously, the alarm bells are far from ringing.The S&P 500 rise of late isn‘t without its good share of non-confirmations though. The ones seen in Russell 2000 and emerging markets got a fresh company in the corporate credit markets. No denying that the stock market is in a strong uptrend, but it got a bit too stretched vs. its 50-day moving average – a consolidation in short order would be a healthy move, but the CPI readings above expectations don‘t favor one today.If you look at the put/call ratio again, its lows throughout Mar and Apr haven‘t been reaching the really exuberant levels of prior months, hinting at a less steep path of S&P 500 gains. And what about the volume print as stocks went about making new highs? Not encouraging either, and it‘s not that rising yields would be causing trouble:(…) The retreat in rising yields is running into headwinds, much sooner than the 10-year one could reach the low 1.50% figure at least. Value stocks and cyclicals such as financials appear calling it out, and both rose on Friday.And financials had a good day yesterday too. Technology welcomed the reprieve, and the heavyweights joined in increasingly more. Again though, more than a little stretched, these $NYFANG generals are rising while the troops (broader tech) are hesitating, which makes a down day / consolidation quite likely, especially should the TLT retreat again. As I wrote yesterday:(…) The rotation simply isn‘t much there, and the TINA trade isn‘t letting much air to come out of the S&P 500 sectors that would be expected to sell off in a more relaxed monetary policy. And that‘s probably what gold is sensing as it grew weak yesterday. The rising yields aren‘t yet at levels causing issue for the S&P 500, but the commodities‘ consolidation coupled with nominal yields about to rise, has been sending gold down yesterday – and miners confirmed that weakness by leading lower. This would likely be a daily occurence only unless and until copper gives in and slides – that‘s because of the inflation expectations having stabilized for now, but Treasury yields not really retreating. Yes, gold misses inflation uptick that would bring real rates down a little again – and is getting one in today‘s CPI as we speak.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookS&P 500 is no longer trading above the upper border of Bollinger Bands, but volume isn‘t picking yet up either. That makes a largely sideways consolidation the more likely scenario here.Credit MarketsBoth high yield corporate bonds (HYG ETF) and the investment grade ones (LQD ETF) declined yesterday while long-dated Treasuries went nowhere – but the bullish spirits in stocks didn‘t evaporate proportionately. This non-confirmation isn‘t too pressing at the moment.Technology and ValueTech (XLK ETF) stumbled yesterday, and it wasn‘t because of $NYFANG (black line) – yet value stocks didn‘t sell off either during these lately turning vapid rotations.Smallcaps and Emerging MarketsThe long underperformance in both indices vs. the S&P 500 goes on, and is actually a stronger watchout than the corporate credit markets at the moment. Inflation ExpectationsInflation expectations as measured by the TIP:TLT ratio are basing, but bond yields are aiming higher again, making higher inflation on the horizon a virtual certainty.Gold, Silver and MinersThe daily underperformance in miners is worrying – this daily leadership to the downside, where gold and silver declined proportionately to each other. Given that commodities didn‘t point to greater weakness, I consider yesterday‘s precious metals downswing as a bit exaggerated. SummaryS&P 500 still appears as entering a consolidation, but I‘m not looking for way too much downside. The Big Tech names would decide, and if you look at Tesla doing well yesterday, the S&P 500 correction would play out rather in time than in price.Gold depends upon the miners‘ path, and nominal yields trajectory. Once more inflation spills over into CPI readings, that would work to negate temporary weakness caused by real rates pressures, which is what we are getting.
New Day, New ATHs with Gold in the Wings

New Day, New ATHs with Gold in the Wings

Monica Kingsley Monica Kingsley 14.04.2021 16:07
S&P 500 went up yet again yesterday, and the corporate credit markets‘ non-confirmation quite resolved itself. While the same can‘t be said about smallcaps or emerging markets in the least, S&P 500 doesn‘t care, and keeps up the staircase rally without real corrections to speak of.Not even intraday ones, unless you count the sharp and brief premarket one yesterday before the CPI figures came out. That‘s the result of the sea of liquidity in practice, and the avalanche of stimuli. The 1.50% yield scare on 10-year Treasuries is long forgotten, and technology welcomes every stabilization, every retreat from even quite higher levels, and value stocks barely budge. No real rotation to speak of and see here, move along.Such were my recent observations:(…) No denying that the stock market is in a strong uptrend, but it got a bit too stretched vs. its 50-day moving average – a consolidation in short order would be a healthy move, but the CPI readings above expectations don‘t favor one today.Talking gold prospects early yesterday:(…) And that‘s probably what gold is sensing as it grew weak yesterday. The rising yields aren‘t yet at levels causing issue for the S&P 500, but the commodities‘ consolidation coupled with nominal yields about to rise, has been sending gold down yesterday – and miners confirmed that weakness by leading lower. This would likely be a daily occurence only unless and until copper gives in and slides – that‘s because of the inflation expectations having stabilized for now, but Treasury yields not really retreating. Yes, gold misses inflation uptick that would bring real rates down a little again – and is getting one in today‘s CPI as we speak.CPI inflation is hitting in the moment, and its pressure would get worse in the coming readings. Yet the market isn‘t alarmed now as evidenced by the inflation expectations not running hot – the Fed quite successfully sold the transitory story, it seems. Unless you look at lumber, steel or similar, of course. None of the commodities have really corrected, and the copper performance bodes well for the precious metals too.The stalwart performance in the miners goes on after a daily pause as gold gathers strength and silver outperformed yesterday. Silver miners and gold juniors are pulling ahead reliably as well, not just gold seniors.The run on $1,760 awaits.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookS&P 500 is no longer trading above the upper border of Bollinger Bands, the price action remains bullish, and volume is ever so slowly picking up (sending weak early signs thereof), but the bulls better watch out for a catalyst forcing a down day once in a while again.Credit MarketsBoth high yield corporate bonds (HYG ETF) and the investment grade ones (LQD ETF) turned around yesterday, and so did long-dated Treasuries – and that supports the bullish spirits in stocks. It was indeed right to view the prior non-confirmation as not too pressing at the moment.Technology and ValueTech (XLK ETF) rose strongly yesterday, and so did the kingmaker $NYFANG (lower black line) and Tesla that I called out yesterday. But value stocks didn‘t sell off – a powerful testament to the TINA trades driving no real rotations to speak of as nothing gets really sold off just on its own.Gold and MinersGold isn‘t in a decline mode anymore, and appears picking up strength so as to take on the $1,760s. Volume is returning, and the current reprieve in rising yields is welcome.Miners returned to the limelight, and it‘s my view they would lead gold by breaking above their recent highs convincingly, as the tide in the metals has turned. Time and desirably a catalyst of such move, is all that is needed. Geopolitics (to the short-term rescue) or more unavoidable inflation data bringing down real rates, that‘s I am looking for next.Silver and MinersSee the gold and silver miners trading in lockstep, remember gold juniors as well, and you get this bullish picture where the whole precious metals sector is slowly coming back to the limelight. In case of silver, the return in volume is boding well for the days ahead – all without the classic signs of bearish isolated silver outperformance. SummaryS&P 500 and the still elusive consolidation – the Fed speakers won‘t likely trigger one today, but bulls, watch out for some daily downside with little to no warning in your plans, after all.Gold and miners‘ paths are aligned, and nominal yields trajectory is boding well for the days ahead when patience is still needed before the nearest resistances in both assets are taken out with conviction.
Stocks, Gold and Commodities Meet the Fed

Stocks, Gold and Commodities Meet the Fed

Monica Kingsley Monica Kingsley 15.04.2021 15:56
S&P 500 in the red – unprecedented. Don‘t pin your hopes too high for a (sharp) correction though. Yes, this time stocks listened to the weakening corporate credit markets, and the daily retreat in long-dated Treasuries inspired some profit taking in tech. Quite some run there as yields stabilized, which has turned XLK from very stretched to the downside of its 50-day moving average, to the upside extreme. Tesla also followed suit but I doubt this is a true reversal of tech fortunes.As stated yesterday:(…) That‘s the result of the sea of liquidity in practice, and the avalanche of stimuli. The 1.50% yield scare on 10-year Treasuries is long forgotten, and technology welcomes every stabilization, every retreat from even quite higher levels, and value stocks barely budge. No real rotation to speak of and see here, move along.CPI inflation is hitting in the moment, and its pressure would get worse in the coming readings. Yet the market isn‘t alarmed now as evidenced by the inflation expectations not running hot – the Fed quite successfully sold the transitory story, it seems. Unless you look at lumber, steel or similar, of course. None of the commodities have really corrected, and the copper performance bodes well for the precious metals too.And the Fed mightily confirmed the message yesterday, which is what commodities loved. Inflation has a free reign, all it has to do is to take advantage of it. And if I look at rising oil filtering into higher gasoline and food prices, the real inflation will keep on biting (even though black gold is excluded from CPI calculations).I don‘t expect these recent observations to change much, especially since we got the daily breather yesterday – but 3, let alone 2 red candles in a row? I haven‘t seen that in stocks for quite a while:(…) No denying that the stock market is in a strong uptrend, but it got a bit too stretched vs. its 50-day moving average – a consolidation in short order would be a healthy move, but the CPI readings above expectations don‘t favor one [on Tuesday].Precious metals didn‘t swing higher immediately, but I expect them to take the commodities‘ cue next. When Powell says the Fed isn‘t thinking about selling bonds back into the market, and that he learned a lesson (hello, late 2018), real rates aren‘t probably rising much any time soon. It appears to me a question of time before inflation expectations squeeze the nominal yields some more, which is what gold would love.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookDaily downswing on marginally higher volume that doesn‘t shift the perspective towards a corrective territory in the least. The correct question instead is probably whether the S&P 500 upswing reasserts itself the next day or the day after.Credit MarketsBoth high yield corporate bonds (HYG ETF) and the investment grade ones (LQD ETF) reversed to the downside yesterday, and long-dated Treasuries didn‘t have a good day either. The reversals are though not to be trusted as I look for the upswing in both to continue.Technology and ValueTech (XLK ETF) driven by $NYFANG (lower black line) and then also Tesla (TSLA), were the key underperformers yesterday. Value stocks kept moving higher, and higher SPX prices are more likely next in this no real rotations to speak of environment, courtesy of all the extra liquidity.Inflation ExpectationsYields are not rising, but aren‘t yet retreating either. Have the rising inflation expectations been banished? I‘m not convinced even though they aren‘t running hotter in the wake of PPI and CPI figures, which are bound to get worse next – if copper and oil are to be trusted (they are). Remember that this is the Fed‘s stated mission for now – to let inflation run to make up for prior periods of its lesser prominence. Gold in the LimelightNominal yields are gradually taking the pressure off the yellow metal as the miners keep outperforming gold. Seniors (GDX ETF) would lead gold by breaking above their recent highs convincingly (solidly above $35 on rising volume and bullish candle shape), as the tide in the metals has turned. The unavoidable inflation data bringing down real rates would do the trick.Silver, Copper and OilWhile silver recovered intraday losses, both copper and oil surged on the Fed reaffirmations. The table is set for miners and both precious metals to move higher next. outperformance.SummaryWhat a fast S&P 500 correction, how did you like it? The bulls have yet again reversed the setback in today‘s premarket session, and the slow grind higher keeps going on.Gold and miners are likely to take a cue from the surging commodities, and grow emboldened by the nominal yields retreat. Patience is still needed before the nearest resistances in both assets are taken out with conviction.
Gold Fireworks Doubt the Official Inflation Story

Gold Fireworks Doubt the Official Inflation Story

Monica Kingsley Monica Kingsley 16.04.2021 16:09
The S&P 500 red candle and then some – erased in a day, that‘s what you get with the Fed always having your back. The staircase climb certainly looks like continuing without any real breather. Whatever steep ascent you compare it to (Jun or early Sep 2020), this one is different in that it doesn‘t offer but token corrections. Not that it would be reasonable to expect a steep downswing given the tide of liquidity, but even sideways trading has become rarer than it used to be.With the VIX still below 17 and the put/call ratio in the middle of its slowly but surely less complacent range, the path of least resistance is higher – the signs are still aligned behind the upswing to go on: (…) Don‘t pin your hopes too high for a (sharp) correction though. Yes, [on Wednesday] stocks listened to the weakening corporate credit markets, and the daily retreat in long-dated Treasuries inspired some profit taking in tech. Quite some run there as yields stabilized, which has turned XLK from very stretched to the downside of its 50-day moving average, to the upside extreme. Tesla also followed suit but I doubt this is a true reversal of tech fortunes.Just at yesterday‘s moves – technology surged higher without too much help from the behemoths, and value stocks surged. Even financials ignored the sharp retreat in yields. Yes, that‘s the result of retails sales outdoing expectations and unemployment claims dropping sharply – the economic recovery is doing fine, manufacturing expands, and inflation doesn‘t yet bite. We‘re still in the reflationary stage where economic growth is higher than the rate of inflation or its expectations.Gold loved the TLT upswing and Powell‘s assurances about not selling bonds back into the market in rememberance of eating a humble pie after the Dec 2018 hissy fit in the stock market (isn‘t this the third mandate actually, the cynics might ask). I called for the sharp gains across the precious metals board sending my open position(s) even more into the black – both on Wednesday:(…) CPI inflation is hitting in the moment, and its pressure would get worse in the coming readings. Yet the market isn‘t alarmed now as evidenced by the inflation expectations not running hot – the Fed quite successfully sold the transitory story, it seems. Unless you look at lumber, steel or similar, of course. None of the commodities have really corrected, and the copper performance bodes well for the precious metals too.and Thursday:(…) Precious metals didn‘t swing higher immediately, but I expect them to take the commodities‘ cue next. When Powell says the Fed isn‘t thinking about selling bonds back into the market, and that he learned a lesson (hello, late 2018), real rates aren‘t probably rising much any time soon. It appears to me a question of time before inflation expectations squeeze the nominal yields some more, which is what gold would love.The stalwart performance in the miners goes on after a daily pause as gold gathers strength and silver outperformed yesterday. Silver miners and gold juniors are pulling ahead reliably as well, not just gold seniors.The run on $1,760 awaits.This is just the beginning, and as I had been repeatedly stating on Twitter:(…) The GDX closing convincingly above $35 would usher in great gold and silver moves.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookNew ATHs, again and this time on rising volume – the momentum still remains with the bulls even though the daily indicators are waning in strength, and as said earlier, $NYFANG causes a few short-term wrinkles.Credit MarketsThe high yield corporate bonds to short-dated Treasuries (HYG:SHY) ratio performance got better aligned with the S&P 500 one, now that nominal yields have retreated.Smallcaps and Emerging MarketsReflecting the turn in the Treasury markets, both the Russell 2000 (IWM ETF) and emerging markets (EEM ETF) clearly turned higher, confirming the direction the S&P 500 has been on practically non-stop since late Mar.Inflation ExpectationsInflation expectations are going down, that‘s the conventional wisdom – and nominal yields duly follow. But the RINF ETF isn‘t buying the TIPS message all that much, proving my yesterday‘s point:(...) Have the rising inflation expectations been banished? I‘m not convinced even though they aren‘t running hotter in the wake of PPI and CPI figures, which are bound to get worse next – if copper and oil are to be trusted (they are). Remember that this is the Fed‘s stated mission for now – to let inflation run to make up for prior periods of its lesser prominence. Gold in the LimelightGold is surging higher ahead of the nominal yields retreat, as the bond vigilantes failed yet again to show up. In the meantime, the inflationary pressures keep building up...Gold, Silver and MinersAs stated the day before, seniors (GDX ETF) would lead gold by breaking above their recent highs convincingly (solidly above $35 on rising volume and bullish candle shape), as the tide in the metals has turned. The unavoidable inflation data bringing down real rates would do the trick, which is exactly what happened. Silver scored strong gains as well, yet didn‘t visibly outperform the rest of the crowd. I look for the much awaited precious metals upleg to go on, and considerably increase open profits.SummaryThe daily S&P 500 downswing is history, and the relentless push higher (best to be compared with a rising tide), goes on.Gold and miners took a cue from the surging commodities, and nominal yields retreat. Patience has been rewarded, and a close above $1,775, is what I am looking for next as the gold bottom is in.
The Inflation Tsunami About to Hit

The Inflation Tsunami About to Hit

Monica Kingsley Monica Kingsley 27.04.2021 15:59
Stocks went on to push higher yesterday – the pressure is building. Trends in place since last week, remain in place for this earnings rich one too. Reflation still rules, reopening trades are well underway, and inflation expectations are modestly turning up again without putting too much strain on the Treasury markets.While Monday wasn‘t an example of a risk-on day, the markets are clearly moving there:(…) overpowering the USD bulls yet again as the dollar bear market has reasserted itself. It‘s not just about EUR/USD on the way to its late Feb highs, but about the USD/JPY too – the yen carry trade is facing headwinds these days, acting as a supportive factor for gold prices. While these went through a daily correction, commodities pretty much didn‘t – lumber is powering to new highs, agrifoods didn‘t have a down day in April, copper and oil scored respectable gains. The market is in a higher inflation environment already, and it will become increasingly apparent that commodity-led inflation is here to stay.Yesterday was a great day for commodities again as these scored stronger gains than tech or $NYFANG, the main winners within the S&P 500 (defensives took it on the chin – seems like we‘re about to see rates move higher again). Anyway, VIX didn‘t object as options traders piled into the clearly complacent end of the spectrum again. Both the Russell 2000 and emerging markets loved that – the best days for smallcaps are clearly ahead:(…) the time of their outperformance, is approaching.Gold miners didn‘t outperform the yellow metal yesterday while silver did – are the ingredients for a metals‘ top in place? I don‘t think so, and have actually called out on Twitter the GDX downswing as likely to be rejected and ending with a noticeable lower knot. And here we are. No changes to my Friday‘s thoughts that:(…) The precious metals upleg has started, we‘re in a real assets super bull market, and this little hiccup won‘t derail it. The sad implication would actually drive it as capital formation would be hampered, unproductive behaviors encouraged, and potential output lowered. Pretty serious consequences – add to which inflation as that‘s what the Fed ultimately wants, and the recipe for more people falling into higher tax brackets through illusory gains, is set. Then, as inflation starts firing on all cylinders – a 2022-3 story when the job market starts overheating – the pain would be felt more keenly. When even Larry Summers starts talking the dangers of an inflationary wave, things are really likely getting serious down the road. On a side note, my tomorrow‘s analysis will be briefer than usual, and published probably a bit later as I have unavoidable dental treatment to undergo. Thank you everyone for your patience and loyalty – it‘s already a little over 3 months since I could start publishing totally independent. Thank you so much for all your support!Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 OutlookThe bears are certainly running (have certainly run) out of time, and the upper knot of yesterday‘s session looks little concerning to me. Tesla enjoying the Bitcoin moves, more tech earnings soon, and favorable sectoral composition of the S&P 500 advance favor the coming upswing.Credit MarketsDebt instruments got under pressure – high yield corporate bonds (HYG ETF) and investment grade ones (LQD ETF) have declined in a signal of non-confirmation, and joined the long-dated Treasuries in their downswing. I am not yet convinced this is a serious enough more to warrant a change in S&P 500 outlook.Technology and FinancialsThe $NYFANG strength continues, powering tech higher – and that‘s the engine behind solid S&P 500 performance. Notably, financials weren‘t waiting yesterday on other value stocks turning higher, and that‘s bullish.Gold, Silver and MinersGold caught a bid, and refused to decline intraday, which almost matches the miners‘ performance. Given these two daily stands, I‘m in favor of disregarding the usual outperformance warning of silver doing considerably better.This is the proper view of the miners and miners to gold ratio – noticeable outperformance in the latter while the former is getting ready to rise again.Gold and the Key RatioAs is visibly even more true today than yesterday, the copper to 10-year Treasury yield ratio shows that the markets aren‘t buying the transitory inflation story – the rush into commodities goes on, and justifiably so. This chart is clearly unfavorable to lower metals‘ prices.SummaryThe S&P 500 keeps pushing for new all time highs, which looks to be a matter of relatively short time only. Credit markets non-confirmation is to be disregarded in favor of strong smallcaps, emerging markets and cornered dollar in my view.Gold and miners are in consolidation mode, but this is little concerning to the bulls. No signs of an upcoming reversal and truly bearish plunge - the precious metals sector is likely to play a catch up relative to commodities as its sluggish post Aug performance would get inevitably forgotten.
Tesla is at local dips. Time to buy?

Tesla is at local dips. Time to buy?

Kseniya Medik Kseniya Medik 11.05.2021 13:09
This article describes how Tesla is positioned now on the stock market, what headwinds and tailwinds it has, and what analysts forecast.US-China tensionsJoe Biden has left 25% tariffs on imported Chinese electric vehicles imposed by Donald Trump. As a result, Elon Musk’s plans to expand its Shanghai plant and make it a global export hub have been ruined. It’s not beneficial for Tesla, that’s why the company now is likely to decrease the proportion of China's output in its global production. What happens in China, stays in China There were disputes over how Tesla handles consumer data and whether it can violate the national safety rules. As a result, Tesla agreed to build a data center in Shanghai by the end of June and store the data gathered by Tesla’s cars locally.Tesla’s sales in China growTesla's sales in China have been rising even despite the regulatory pressure from the Chinese government. The company has generated $3 billion in revenue in China in the first quarter of 2021, it’s three times more than a year ago and accounts for 30% of total Tesla’s revenue.Competition is getting hotterHowever, Tesla is not the only electric vehicle producer in China. It’s competing with Nio, which is quite popular in China. Besides, electric-vehicle competition is growing around the globe: Lucid Motors, Ford, and Volkswagen. Chip shortageThere is a chip shortage around the world, and it creates some significant problems for electric-vehicle producers and Tesla as well. However, it cannot be viewed as a negative factor only for Tesla, it’s a challenge for the whole EV industry and also other sectors dependent on chips. Besides, it will only be a temporary setback.Buy or not to buy?It’s a tricky question as some analysts believe that Tesla has more room to fall further, while at the same time others forecast Tesla to skyrocket. For example, Wedbush's Dan Ives expects Tesla to reach $1000! Isn’t it too optimistic, what do you think?As you may have noticed, there are more headwinds than tailwinds for now, but Tesla tends to rise no matter what. So when such a company as Tesla is at the local dips, it’s likely to attract buyers as it has many investors that believe in the company and it’s still the #1 electric vehicle producer. Let’s look at what the charts will tell us!Tech analysisTesla has dropped out of the ascending channel. It’s approaching the psychological mark of $600.00. Since the RSI indicator is not yet below the 30.00 level, the stock may drop to this support level. However, the falling should stop at that point as the stock is already below the lower line of Bollinger Bands and the 200-day moving average just below $600 will be a strong barrier. When it reverses up, it may meet resistance levels at the 50-day moving average of $680.00 and late-April highs of $750.00. Download the FBS Trader app to trade anytime anywhere! For personal computer or laptop, use MetaTrader 5!
Gold & the USDX: Correlations

Musk crashed Bitcoin. Time to buy dips?

Kseniya Medik Kseniya Medik 13.05.2021 15:42
What happened?Elon Musk, Tesla’s founder and CEO, said the company wouldn’t accept Bitcoin as payment any longer. As a result, BTC/USD dropped to $45,300, the low unseen since March.Why has Musk done that?He explained his actions with environmental issues: “rapidly increasing use of fossil fuels for Bitcoin mining and transactions”. Indeed, this problem exists. According to Citigroup’s report, Bitcoin mining is consuming 66 times more electricity than it did back in late 2015, and as a result, carbon emissions are increasingly rising.What’s next?He won’t sell any of the Bitcoin Tesla already holds and what’s more important, he signaled he might accept other cryptocurrencies as payment if they are less energy-intensive. Well, what would be his next #1 crypto? Maybe Dogecoin? He asked about that his followers on Twitter already: 78% said yes. There are some talks about ETH and XRP right now.What about Bitcoin?Musk’s tweet can’t make an end to Bitcoin. The BTC is still the #1 cryptocurrency by the market cap and it’s likely to keep its uptrend in the long term. For most investors, it’s just a good opportunity to buy the dips.Tech tipsThe RSI indicator hasn’t yet crossed the 30.00 level on the daily chart. Therefore, there is still some room to fall further, but probably the price reverses up from the current levels. If it jumps above the midline of Bollinger Bands at $55,000, the way up to $60,000 will be open. In the opposite scenario, the move below the lower trend line at $48,000 will press down the crypto to the $45,000 support.Download the FBS Trader app to trade anytime anywhere! For personal computer or laptop, use MetaTrader 5!
Apple, Tesla, and Bitcoin are in a technical ‘Excess Phase Top”

Apple, Tesla, and Bitcoin are in a technical ‘Excess Phase Top”

Chris Vermeulen Chris Vermeulen 17.05.2021 14:58
Yesterday I highlighted thebroad market cyclesand what technical analysts call the “Excess Phase Top” process, which usually takes place after the markets peak and setup a downward price trend.There are a number of technical setups that take place throughout this process. Today, I will be exploring the charts of Tesla (TSLA), Apple (AAPL), and Bitcoin (BTC) to see where they are in the process.The suggestion I am making by highlighting these market trends and setups is that a Cash Position is a viable allocation of capital away from risks and losses. Many traders don't view a cash position as a properly allocated use of capital. We believe taking a cash position at the right times can anddoes provide very clear benefits, including:Eliminating risks of further losses/drawdowns.Setting up a process of protecting cash and waiting for a confirmed re-entry trigger.Avoiding the failure of buying into a declining market – which is one of thebiggest faults of active traders.Using the Cash position as a hedge against shifting currency/market valuations.Remember, in many cases, broad market downtrends are often associated with bigger trends in currencies and global market sectors. Chasing these trends can lead to further risks if you are not careful and skilled in your trading decisions. Keeping your capital in a Cash Allocation/Position is often the easiest and safest way for you to ride out volatile downside price trends and allows you tore-deploy your cash into new trades when the time is right.Understanding Broad Market Cycles & TrendsBefore we get started, we are going to share the broader market cycles chart with you to refresh your memory (or if you missed the first part ofthis research article).Before looking at the charts, please bear in mind that these patterns often take place over many months. Usually, the initial topping (#1) phase and flagging formation (#2) take place over a 60 to 90+ day span of time. Yes, sometimes these setups can take place over shorter spans of time, but usually, they last over 60+ days.Additionally, the breakdown of the Flag formation (#2), which leads to the setup of intermediate support (#3), can often take many months to complete aswell. My research team and I have seen the Flagging setup last well over 30 days at times and after the immediate support level is reached, markets sometimes attempt to move sideways for many weeks/months before attempting to break below that support level.APPL Continues To Flag Out – Watch for potential breakdown below $115.The Weekly AAPL chart below highlights the rally from $35 to over $140 over the past 2.5 years (notice the price split that happened in 2020). This rally reached a peak near January 25, 2021 (#1) and has fallen nearly 20% from the peak levels before starting a sideways Flag formation (#2). This type of setup completes the first two processes of the Excess Phase Top setup and aligns with the broader market cycles to suggest we mayhave entered the “Complacency” phase of price trending.The sideways Flagging pattern (#2) on this chart suggests AAPL may continue to move within this price channel before attempting to either recover, by moving to new highs or to break below the $115 level (#3), which would confirm the next phase of the Excess Phase Top pattern. If we see any continued breakdown in price, traders need to prepare for the markets to attempt to move downward, targeting historical support levels, where we expect price toconsolidate for many weeks/months. I have drawn a YELLOW line near a very clear support level for AAPL near $80 as a potential downside price target. If this Excess Phase Top pattern fails, we will likely see AAPL rally back above $145 and attempt to break into a new bullish trending phase.Tesla Breaks Below Flag Channels – What's Next?The following Weekly TSLA chart highlights the rally from $73 to over $900 over the past year (note the price split that happened in 2020). This rally also reached a peak near January 25, 2021 (#1) and has fallen nearly 40% from the peak levels before starting a sideways Flag formation (#2). At this phase of price action, we can see TSLA has recently broken below the lower Flag price channel and may be attempting to start a downward price trend where price will seek out intermediate support.I have drawn a YELLOW line near a very clear support level for TSLA near $430 as a potential downside price target for this next phase of the Excess Phase Top pattern (#3). From atechnical standpoint, if the support level near recent lows, near $540, holds, and price is unable to move below this level, then we may see a technical failure of the Excess Phase Top pattern. The move to the intermediate support level, which must be lower than the lows of the Flag formation, is critical in confirming the move into “Complacency” and the transition into “Anxiety” on the Broad Market Cycle example. Without this subsequent breakdown in price happening, we would consider the Excess Phase Top pattern potentially invalid (or failed) and start to watch for any new upside price trending – eventually targeting recent highs near $780. At this point, the $540 lows have become the new critical price level for TSLA and we are expecting price to continue to move lower, possibly breaching the $540 level.Bitcoin Gaps Lower After Peak & Breaks Flag Lows – What's Next?This last chart for Daily BTC Futures highlights the rally from $10,200 to over $65,500 over the past 7.5 months. This rallyreached a peak near April 14, 2021 (#1) and Gapped lower on April 19, 2021. The recent downside price move from that peak totaled nearly -27% before starting a sideways Flag formation (#2). In order to confirm the next phase of this Excess Phase Top pattern, we would watch for price to break lower, breaking the Flag formation channels, and attempt to break below the recent support level near $47,440. If we see a strong breakdown in price where closing price levels break below $47,440, I would expect price to move quickly below $40,000 and attempt to seek out critical support.I have drawn a YELLOW line near a very clear support level for BTC near $34,250 as a potential downside price target for this next phase of the Excess Phase Top pattern (#3).Recently, Bitcoin broke below the Flag formation lower channel and briefly traded below support near $47,440. If we continue to see downward price trending where price closes below this level, I would consider this technical confirmation of the Excess Phase Top pattern, suggesting price will attempt to continue moving lower while trying to seek out intermediate support (near the YELLOW line possibly).At this point, Bitcoin is showing moderate weakness and has already attempted to break recent support. Any confirmation of further downward trending could push us out of the Complacency phase and into the Anxiety phase of the broad market cycles. Are you ready for what's next?The question of “Should You Be In Cash” right now is a very valid concern for many traders/investors. Learning how to identify and understand risks and technical patterns/setups in the markets is critical to understanding how to protect and grow your wealth. Additionally, learning to use the Cash Position, and proper position sizing, asa valid type of trading allocation is essential, in our thinking, to protect your assets throughout volatile market trends. The next 12 to 24 months are almost certain to include much higher price volatility and big price rotations/trends, which will translate into incredibleopportunities for traders/investors.Over the next 6+ months and beyond, there are going to be incredible market moves. Staying ahead of these index and sector trends is going to be key to developing continued success. As somesectors fail, others will begin to trend higher, and this is the type of research and work I share every day at The Technical Traders Ltd.Happy Trading!Chris VermeulenChief Market Strategistwww.TheTechnicalTraders.com
Is it time to buy Coinbase?

Is it time to buy Coinbase?

Kseniya Medik Kseniya Medik 17.05.2021 15:39
Coinbase, one of the world’s top crypto exchanges, has started the year on a positive footing as it has become the first crypto exchange in history that went public. On April 14, it was listed on Nasdaq. However, 60% of its trading volume depends on Bitcoin and Ethereum, which have lost a large part of their value recently. For newbies, it can be frightening, but for experienced traders – it’s an opportunity to buy the dips. Bitcoin’s dominance wanes Coinbase may have problems if it continues to be as dependent on Bitcoin as it’s now as Bitcoin’s dominance is waning. That’s why the crypto exchange is adding new cryptocurrencies. For example, it has recently announced it would add Dogecoin to its exchange in 6-8 weeks (the one that Elon Musk called a ‘hustle’ in a Saturday Night show). What’s wrong with Bitcoin? As Elon Musk tweeted, Bitcoin mining requires a lot of electricity, which in turn increases the usage of fossil fuels and pollutes the environment. Indeed, this problem exists as bitcoin mining uses more electricity than most countries do. And if other eco-friendly companies join Tesla and reject payment in Bitcoin, the cryptocurrency may fall even deeper, and for Coinbase it would be a blow. Coinbase’s performance Coinbase’s earnings results came out slightly worse than expected, but the broad picture is great. The company has attracted 56 million users and its revenue tripled from the quarter before. Trade Coinbase and other stocks in our app FBS Trader and don’t forget that stock trading is available from 16:30 GMT+3 to 22:59, while crypto trading is available for trading 24/7! Coinbase is touching the dips these days. Therefore, it’s important to keep an eye on the chart as the reverse up may occur soon because the popularity of cryptocurrencies is growing despite all these negative factors mentioned above.
Stock Market Attempts To Break Support Channel – What's Next?

Stock Market Attempts To Break Support Channel – What's Next?

Chris Vermeulen Chris Vermeulen 19.05.2021 22:12
The recent price volatility related to the surprise Jobs number, nearly ten days ago, and the potential for inflationary price trends extended beyond the Fed expectations has created a unique type of sideways price rotation on the INDU chart.  This recent price volatility suggests the markets are struggling to identify future trend bias as well as attempting to shake out certain traders and investors (running stops).Additionally, the downside price trend we've recently seen in Lumber, breaking away from the continued rally mode, and Bitcoin, breaking downward nearly -54% from recent highs, suggests a broad market “washout” is taking place.  How far will this trend continue?  Will the US stock market break downward like Bitcoin has recently done?  Let's take a look at the charts and try to answer some of these questions.Before we continue exploring charts, I suggest readers review some of my recent research posts relating to this potential downward price trend in the US/Global markets, including: Are We Days Away From Potential Gann/Fibonacci Price Peak? (March 17, 2021); Market Leverage Reaches New All-Time Highs As The Excess Phase Rally Continues (April 25, 2021); and Are Apple, Tesla, and Bitcoin Entering a Technical ‘Excess Phase Top’? Should You Be In Cash Right Now? Part II (May 15, 2021).Expect Continued Price Volatility As Markets Attempt To Establish New TrendsWe'll start by exploring the Dow Jones Industrial Average Daily chart, below, and the first thing we want to highlight is the extended upward (YELLOW) price trend channel.  This upward sloping price channel has been in force since the March 2020 COVID-19 lows.  It was confirmed by the November 2020 lows and retested in March 2021.  Typically, when price channels this strongly over an extended period of time, the price channel becomes a psychological barrier/wall for price trending.  When it is breached or broken, price trends often react moderately aggressively – with excessive volatility.Over the past 10+ days, near the right edge of this chart, we can see that price has started to react with much higher volatility and broad sideways price trends.  It appears the INDU chart has entered a new phase of market price activity – moving away from moderately low volatility bullish trending and into much higher volatility sideways rotation.  We attribute this to a shift in how traders and investors perceive the future actions of the US Fed and how risks are suddenly much more prominent than they were 3+ weeks ago.  It appears the “rally euphoria” has ended and traders are starting to adjust expectations related to a slower economic reflation of the global economy.Depending on how traders and investors perceive the future growth opportunities in the US and global markets, as well as how new strains of the COVID-19 virus may continue to disrupt global economies, we may see a fairly big change in trend throughout the rest of 2021 and possibly into 2020.  In our opinion, the tremendous rally phase that took place between October 2020 and now has been anchored on the perception that the COVID vaccines would allow for an almost immediate and nearly full economic recovery attempt.  Now, after we are seeing various new strains of COVID ravage India, Europe, Africa and parts of South-East Asia, expectations may be changing quickly.Everything Hinges On How Price Reacts Near The YELLOW Support Channel LineThis Weekly Dow Jones Industrial Average chart highlights the same upward sloping price trend from the March 2020 COVID-19 lows.  It also shows the start of the broad market rotation over the past three weeks and highlights three key “standout lows” that we interpret as critical support levels.  These support levels are at $32,090, 30,575, and $29,875.Sign up for my free trading newsletter so you don’t miss the next opportunity!If we continue to see downward price trending which breaks through the YELLOW upward sloping price channel line, it is very likely that price will continue to move lower while attempting to find new support near these standout low price levels.  This suggests any breakdown in the INDU may prompt a further -5% to -11% downside price move.If the recent price rotation stalls and continues to find support above the YELLOW upward sloping price channel line, then we expect the US markets to transition into a sideways bottoming formation which will prompt another rally attempt in the near future. Everything hinges on what happens over the next few weeks related to this key YELLOW upward sloping price channel.What this means for traders and Investors is that certain market sectors are still posed for strength and growth over the next 6 to 12 months.  The recent downside price volatility suggests broad market concerns related to a continued reflation trade are certainly evident in how the markets are trending.  Yet, within this potential sideways rotation, there are sectors and trends that still present very real opportunities for profits. If the major US indexes find support above the YELLOW price channel line and attempt to mount another rally, traders need to be prepared for this potential opportunity in the markets – attempting to target the best and strongest market sectors.As I just mentioned, everything hinges on what happens over the next few days and weeks related to the YELLOW price support channel.  One way or another, the markets are either going to attempt to rally higher while this support channel holds or a bigger breakdown event may take place as price breaks below the support channel and attempts to find new, lower, support.Learn why we moved our BAN clients into CASH over a week ago and learn how we use the BAN trading strategy to manage risks and take advantage of the strongest market sectors. Please take a minute to learn about our BAN Trader Pro strategy and how it can help you identify and trade better sector setups.  Every day, we deliver these setups to our subscribers along with the BAN Trader Pro system trades.  You owe it to yourself to see how simple it is to trade 30% to 40% of the time to generate incredible results.Enjoy the rest of your day!!
Gold & the USDX: Correlations

All Eyes on Big Tech Earnings this Week. Contrarian Play?

Finance Press Release Finance Press Release 26.07.2021 20:43
Another day, another all-time large-cap equity index high, right? Today, let’s take a look at an ETF that could interest traders looking for a contrarian strategy.The bull market has continued, albeit with some warning signs beneath the surface of the market.Last week, markets flexed their resiliency muscles by quickly erasing a 700 + point Dow Jones Industrial Average on Monday and ending the week at all-time highs. Easy monetary policy has continued, and liquidity is high. There was no shortage of buyers that were ready, willing, and able to buy that dip.Even though the Fed has telegraphed its message of increasing rates in the future, Fed bond purchases have continued for the time being. The purchasing of these bonds helps to keep rates lower and create liquidity across markets.Since June of 2020, the Fed has been buying $80 billion a month in Treasury bonds and $40 billion in MBS (Mortgage Backed Securities).There is quite a lot happening this week. Consumer Confidence is set for release tomorrow. We will hear from Fed Chair Powell on Wednesday with the FOMC statement and the subsequent conference call. Advance GDP and Core PCE are on the table for later in the week.All of the above happens during earnings week for the tech giants, namely Apple, Facebook, Google, Tesla, Amazon, and Microsoft.What can we do on a week like this when the S&P 500 is at or near an all-time high?Last week, we examined the divergence of the Dow Jones Transports and the Dow Jones Industrial Average.The Transports:Figure 1 - Dow Jones Transportation Average March 8, 2021 - July 26, 2021, Daily Candles Source stockcharts.comTransports have been weak, and today the index traded up to and touched the 78.6% Fibonacci retracement level from its July 1, 2021, high to its July 19, 2021 low. What is going on with the transports?We can see lower highs and higher lows that have been occurring since May. Today is providing a nice bounce and intraday reversal so far.As we can see, there is a downtrend in place in an otherwise sector uptrend dominant marketplace, let’s go with what is working here.Looking for an ETF to take advantage of this downtrend is no easy task. Currently, I do not see a liquid way to take the inverse side of the transportation, so we will examine a short position in IYT.Figure 2 - iShares Transportation Average ETF March 18, 2021 - July 26, 2021, Daily Candles Source stockcharts.comWe see IYT doing its job rather well, seeking to track the investment results of an index composed of U.S. equities in the transportation sector.Considering this downtrend could be a way to gain some alternative exposure in today’s market.We are in a big earnings and economic data release week. There could be volatility in either direction in the major indices.Since I am cautious on the indices in the current landscape per previous Stock Trading Alert publications, a trade in the transports could be a way to take advantage of an existing countertrend, while the major market indices have been trading at highs.Now, for our premium subscribers, let's look to pinpoint potential entry levels in IYT, and recap the other markets that we are covering. Not a Premium subscriber yet? Go Premium and receive my Stock Trading Alerts that include the full analysis and key price levels.Thank you for reading today’s free analysis. I encourage you to sign up for our daily newsletter - it's absolutely free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to the premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today!Thank you.Rafael ZorabedianStock Trading StrategistSunshine Profits: Effective Investment through Diligence & Care* * * * *This content is for informational and analytical purposes only. All essays, research, and information found above represent analyses and opinions of Rafael Zorabedian, and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. You should not construe any such information or other material as investment, financial, or other advice. Nothing contained in this article constitutes a recommendation, endorsement to buy or sell any security or futures contract. Any references to any particular securities or futures contracts are for example and informational purposes only. Seek a licensed professional for investment advice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Information is from sources believed to be reliable; but its accuracy, completeness, and interpretation are not guaranteed. Although the information provided above is based on careful research and sources that are believed to be accurate, Rafael Zorabedian, and his associates do not guarantee the accuracy or thoroughness of the data or information reported. Mr. Zorabedian is not a Registered Investment Advisor. By reading Rafael Zorabedian’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Trading, including technical trading, is speculative and high-risk. There is a substantial risk of loss involved in trading, and it is not suitable for everyone. Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment when trading futures, foreign currencies, margined securities, shorting securities, and trading options. Risk capital is money that can be lost without jeopardizing one’s financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Rafael Zorabedian, Sunshine Profits' employees, affiliates, as well as members of their families may have a short or long position in any securities, futures contracts, options or other financial instruments including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice. Past performance is not indicative of future results. There is a risk of loss in trading.
Biotech Stocks Surged: Moderna, BioNTech, Novavax

Biotech Stocks Surged: Moderna, BioNTech, Novavax

Kseniya Medik Kseniya Medik 11.08.2021 11:48
The biotech industry has always had a high potential to grow, but the pandemic has boosted this sector even more and as a result, attracted many new investors especially vaccine producers. Let’s go through the top stocks of the biotech industry.ModernaModerna surged on the announcement that its Covid-19 vaccine was granted provisional registration by Australia's administration. Moderna is planning to supply as many as 25 million doses of its vaccine to the Australian government by 2022.However, this company has a unique feature. It has joined one of the most credible stock indexes in the US – the S&P 500 index. It helped the stock to rise even more! Check our recent article to see what happened with Tesla when it joined S&P 500.Moderna has almost reached the psychological mark of $500.00, but as it often happens, it has failed to cross such an important level on the first try. We can expect that sooner or later, it will break this resistance level and rally up further to the next round number of $550.00. Support levels are $400 and $350.00.Pfizer and BioNTechBioNTech and Pfizer have recently published better than expected earnings results for the second quarter. The companies claimed they can produce up to 3 billion Covid-19 vaccines this year, with capacity increasing to 4 billion doses in 2022. Pfizer is getting closer to the $50.00 level, while BioNTech has reversed down from $463.00. NovavaxMeanwhile, Novavax has gained from Barron’s article. It was written that the New York State Common Retirement Fund, the third-largest public pension in the US, has increased its stake in Novavax and other vaccine stocks. However, the vaccine maker claimed that it would delay submission of its Covid-19 vaccine to the Food and Drug Administration for emergency use authorization until the fourth quarter.The breakout above the $240.00 resistance level will push the stock up to the high of April 27 at $260.00. After that, the stock price may jump to an all-time high near $320.00. Support levels are the 100- and 200-day moving averages of $190.00 and $170.00, respectively.   Download the FBS Trader app to trade anytime anywhere! For personal computer or laptop, use MetaTrader 5!
Jackson Hole Positioning

Jackson Hole Positioning

Monica Kingsley Monica Kingsley 25.08.2021 16:04
More optimistic follow through yesterday brought additional gains to commodities while stocks and gold treaded water. Just as I wrote yesterday, the celebrations of the taper tough talk being just talk, were a little too powerful, and at least a modest daily consolidation arrived.Credit markets point to the risk-on moves to continue, favoring the reflation trades as yields and inflation expectations would slowly but surely pick up. The dollar has gone on the defensive again but look for it to recover some ground as metals and cryptos are gently hinting at today. Are the commodities and precious metals bull runs in jeopardy though? Not in the least as the conditions haven‘t and won‘t change with the Fed taper plays that have rocked the boat last week quite well.As stated yesterday:(…) And with much of the tapering done through the repo market in a way already, the focus will shift to the balooning deficits and debt ceiling so as to confront the disappointment creeping in through Monday‘s PMIs and more. I‘m not looking though for a deterioration strong enough to derail the stock market and commodities bull runs. Let alone the precious metals one. A good signal thereof would be widening credit spreads on the long end as the short end has been flattened already.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookDaily pause is all we‘ve seen in stocks yesterday, with Nasdaq hit a little on account of the rising nominal yields. As even value found it hard to sustain gains, we‘re likely to see the consolidation to continue next as big moves before the Jackson Hole is over, are unlikely.Credit MarketsHigh yield corporate bonds continued the march higher, closing on a strong note again – the daily consolidation hasn‘t thus far arrived there. Overall positive turn in credit markets that‘s however leaving it a little extended for today and tomorrow unless the quality instruments rise modestly.Gold, Silver and MinersNot too much interesting has happened in the gold sector – only silver joined in the copper and oil upswings. Look for the sensitivity to the dollar moves to continue to a modest, yet decreasing degree as the taper suspense gets resolved – I say temporarily resolved as I don‘t believe in crystal clarity after Jackson Hole.Crude OilCrude oil rebound continues, and a little breather next wouldn‘t be unexpected. Reasonable prices have been reached, and the local bottom is in.CopperCopper rebound continues, and stabilization at around 4.25 is very constructive for the bulls – bullish chart and fundamentals even if we might go a little sideways first still (the red metal is slowing down a little vs. the CRB).Bitcoin and EthereumCryptos are bidding their time – haven‘t breached any important support just yet. As stated yesterday, backing and filling before another upswing wouldn‘t be at all surprising.SummaryBefore the Jackson Hole, I‘m not looking for extensive and sustainable moves one or the other way. Return of the risk-on trades should be the lens to watch the markets through even though a discreet liquidity tightening is going on under the surface as e.g. margin debt data show. And don‘t look for M2 movements to put a stop to inflation.Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.
Ford Rocketed. Is It Still a Buy?

Ford Rocketed. Is It Still a Buy?

Kseniya Medik Kseniya Medik 13.10.2021 16:10
What happened?The automaker Ford has jumped sharply! What are the main drivers of such rapid growth? Let’s find out! First, the auto giant Ford has started to lay the groundwork to transform its petrol-driven cars into electric vehicles.Ford’s Electrification revolution planThe company is going to spend $30 billion in investments for electrification until 2025.Ford intends to make EVs a significant part of its total product mix: 40-50% of all Ford’s vehicles should be electric by 2030.It makes investors excited. More and more people add the stocks of EVs to their portfolios. Indeed, electric vehicles are the trend of the last years as the key problem for the whole world remains climate change. Thus, renewable energy stocks are on the rise right now. Apart from Ford, pay attention to Tesla, Apple (it plans to launch its EV car), General Motors.Ford’s performanceThe Ford stock has jumped by 65% from $8.79 to $14.50 since the end of 2020. Just to compare, the broad market index, S&P 500 (US 500) has surged by 16% in the same period.Chip shortageLast week, the company claimed it would be forced to cut production even more at its factories in North America amid the current global semiconductor shortage. It may weigh on the stock price in the near to medium term, but this problem is global, so it will impact many stocks linked to semiconductors. Thus, this obstacle is not so serious.Tech outlook There is a nice uptrend in the daily chart. The stock price has broken above the psychological mark of $15.00 and even pulled back to this level after a breakout – a sign of the continuation of an uptrend. We might expect the stock price of Tesla to advance to June’s high of $16.50. If it manages to cross this resistance level, the stock may jump to the next round number of $17.00. Support levels are the recent low of $15.00 and the 100-day moving average of $14.00.Download the FBS Trader app to trade anytime anywhere! For personal computer or laptop, use MetaTrader 5!
Gold FINALLY Breaks Free Amidst S&P INSANITY

Gold FINALLY Breaks Free Amidst S&P INSANITY

Mark Mead Baillie Mark Mead Baillie 08.11.2021 08:13
Gold, after 18 weeks of being stuck in a maniacal Short trend without price really going anywhere, FINALLY broke the bonds of the M word crowd by flipping to Long -- but not without a mid-week scare: more later on that affair. But we begin by assessing the stark INSANITY besetting the parabolic performance of the S&P 500, +25% year-to-date. It settled yesterday (Friday) at 4698 (reaching 4718 intra-day), a record closing high for the seventh consecutive session. Such phenomenon has occurred but five other times in the past 41 years! So here's a multiple choice question for you: Ready? Across all those years (i.e. from 1980-to-date), what is the longest stretch of time between all-time highs for the S&P 500? â–  a) eight monthsâ–  b) just over three yearsâ–  c) slightly less than six yearsâ–  d) all of the above (for you WestPalmBeachers down there)â–  e) none of the above If having answered "e)", you are correct: the longest stint was almost seven-and-one-quarter years from 24 March 2000 through the DotComBomb up to 13 Jul 2007. 'Twas the complete antithesis of the current paradigm of an all-time high every single trading day. But wait, there's more: those of you who were with us way back in the days at AvidTrader may recall our technically having "mild", "moderate" and "extreme" readings of both oversold and overbought conditions for the S&P. Well, get a load of this: yesterday was the S&P's 12th consecutive day with an "extremely overbought" reading. During these 41 years, that has only happened once before, 36 years ago in 1985. And the price/earnings ratio then was a respectable 10.5x: today 'tis five times that much at 54.4x (!!!) easily more than double the S&P's lifetime median P/E (since 1957) of 20.4x. And still more: Every time the S&P moves from one 100-point milestone to the next, 'tis a FinMedia "big headline deal", albeit the percentage increase comparably narrows. Nonetheless, trading gains and losses are measured by the point, not the percentage. And from 1980-to-date, the S&P has gone from 100 to now 4700, (i.e. through 46 milestones. Upon having just achieved the 4600 level on 29 October, the average number of trading days over these past 41 years to reach each 100-point milestone is 236 (just about a year's worth). But now from 4600-4700 took just five days! Cue John McEnroe: "You canNOT be SERious!!" 'Course, every trend reaches a bend, if not its end. And whilst the market is never wrong, something will the S&P upend. You regular readers already know the "earnings are not there" to support even one-half the S&P's current level. Moreover, 'tis said when the Federal Open Market Committee does nudge up its Bank's Funds rate, 'twill be "Game Over" for the S&P, (something of which the Fed is very fearful). "But mmb, even a rise from just 0.25% to only 0.50% maintains a really low rate..." Nominally still low, yes Squire: but upon it occurring, the Fed shall have doubled the cost for every bank that comes to the borrowing window, from which one can then ask banking clientele: "How's that variable rate loan workin' out for ya?" And thus falleth the first domino. And the S&P. Have a great day. Gold had a great day yesterday in settling out the week at 1820. But as noted, 'twas not before a mid-week scare. With Gold wallowing on "The Taper of Paper" Wednesday -- down at 1758 (a three-week low) -- the tried-and-true, widely followed daily moving average convergence divergence (MACD) crossed to negative. Such previous 11 negative crossings had averaged downside follow-through of 86 points. Thus within that technical vacuum, another run sub-1700 was placed on Gold's table. What instead followed was a one-day whipsaw, Gold's MACD finishing the week with a positive cross, and even better, the weekly parabolic Short trend FINALLY being bust per the first Gold-encircled dot in our weekly bars graphic: FINALLY too Gold had its first Friday in five of not being flogged ostensibly by the M word crowd. Should they thus have left the building, in concert with both the daily MACD back on the positive side and the weekly parabolic again Long, the door is open for Gold to glide up into the 1900s toward concluding 2021. As for the five primary BEGOS Markets, here are their respective percentage tracks from one month ago (21 trading days)-to-date, the S&P having swiftly replaced Oil as the leader of the pack. Of more import, note the rightmost bounce for Gold and the Bond. Why are those two stalwart safe havens suddenly getting the bid? (See our opening commentary on S&P INSANITY): Meanwhile as we waltz into the waning two weeks of Q3 Earnings Season, of the S&P's 505 constituents, 426 have reported (450 is typically the total within the seasonal calendar), of which 340 (80%) have bettered their bottom lines from Q3 of a year ago when much of the world purportedly was "shut down". Thus such significant improvement was expected: "They better have bettered!" Yet as noted, our "live" P/E is at present 54.4x. Thus to bring earnings up to snuff such as to reduce the P/E to its lifetime median of 20.4x, bottom lines need increase by 167%: but the median year-over-year increase (for those 396 constituents with positive earnings from both a year ago and now) is only 19%. Thus for those of you scoring at home, a 19% increase is nowhere near the "requisite" 167%. "Look Ma! Still no earnings!" (Crash). Still earning to grasp good grace is the track of the Economic Barometer, which bopped up a bit on the week's headline numbers. To be sure, October's Payrolls improved with a decline in the Unemployment Rate and a jump in the Institute for Supply Management's Services Index. But with a return of folks to the workplace (excluding those who've post-COVID decided they don't need to work) came a plunge in Q3's Productivity combined with a spike in Unit Labor Costs. As well, October's growth in Hourly Earnings slowed and the Average Workweek shortened, such combination suggesting temporary jobs materially lifted the overall Payrolls number. Also less highlighted was September's slowing in Factory Orders, shrinkage in Construction Spending, and the largest Trade Deficit recorded in the Baro's 24-year history. Here's the whole picture from one year ago-to-date with the S&P standing up straight: To our proprietary Gold technicals we go, the two-panel graphic featuring price's daily bars from three months ago-to-date on the left with the 10-day Market Profile on the right. And note the "Baby Blues" of linear regression trend consistency being abruptly stopped in their downward path thanks to Friday's "super-bar" -- Gold's best intra-day low-to-high run in nearly four weeks -- and the highest closing price since 04 September. As well in the Profile, price sits atop the entire stack, which you'll recall for the prior two weeks was at best a congestive mess. But to quote Inspecteur Clouseau, "Not any moooure...": As for Silver, she's not as yet generating as much comparable excitement. At left, her "Baby Blues" continue to slip even as price gained ground into week's end. At right, the price of 24 clearly is her near-term "line in the sand". Still, our concern a week ago of her falling into the low 22s has somewhat abated, albeit the daily parabolic trend remains Short; however a quick move to 24.700 ought nix that condition. "C'mon, Sister Silver!": So there it all is. We see Gold as poised to FINALLY move higher toward year-end, (barring a resurgence of the M word crowd). And we see the S&P as poised for its off-the-edge-of-the-Bell-curve INSANITY to cease, (barring an economic erosion that instead furthers the flow of free dough). After all, bad is good, just as Gold is always good. In that spirit to conclude for this week, here are three good bits from a few of the smartest (so we're told) people in the world: Betsey "With an e" Stevenson says with respect to folks not returning to the workforce post-COVID that "...It’s like the whole country is in some kind of union renegotiation..." That is True Blue Michigan-speak right there. But think about it: when you've got a) the upper labor hand, and b) the aforementioned free dough that you popped into the stock market to thus gain some 38% since the economy first shutdown, why work, eh? Besides, the feeling of marked-to-market wealth is a beautiful thing. Elon "Spacey" Musk now notes that Tesla has not contracted with Hertz to sell 100,000 four-wheel batteries. Recall when that deal first was announced, the price of TSLA went up many times more than the additional incremental return of the transaction. But hardly has it since retracted. 'Course, the company's Q3 earnings were "fantastic", in turn nicely bringing down the stock's P/E to just now 345.8x. And comparably as you already know, the only other two S&P 500 constituents classified as being in the sub-industry category of "Automobile Manufacturers" are Ford (P/E now 26.1x) and General Motors (P/E now 7.7x). But a shiny object that rolls, too, is a beautiful thing. Peter "Techie" Thiel has just opined that the soaring price of bits**t is indicative of inflation being at a "crisis moment" for the economy. 'Tis not ours to question this notion; rather 'tis beyond our pay grade to understand it. What we do understand is that THE time-tested (understatement) indicator and mitigator of inflation -- i.e. Gold -- is priced at such an attractively low level versus where it "ought" be (i.e. 3981 per our opening graphic's decree), that never again such a beautiful opportunity shall we see! Cheers! ...m... www.deMeadville.com www.TheGoldUpdate.com
US tech stocks under pressure ahead of FED speeches

US tech stocks under pressure ahead of FED speeches

Walid Koudmani Walid Koudmani 08.11.2021 12:53
US tech stocks under pressure ahead of FED speeches While US stock markets continued to reach new all time highs and after the FED announced it would be starting its QE tapering in last week's meeting, we are seeing some increased selling pressure at the start of the week with US futures slightly down. This comes after Elon Musk announced over the weekend that he would be selling 10% of his Tesla shares (worth around $21 billion) depending on the results of a poll he held on Twitter, this in turn worried some investors who noted that selling such a significant stake could create significant downward pressure on the share price. On the other hand, it is worth noting that due to the elevated trading volume that Tesla shares experience, any potential impact could be significantly mitigated if the CEO were to spread that sale across several weeks. Finally, today's FED speeches could shed some light on the central bank's outlook heading into the final part of the year and could further elaborate on last week's decision to begin tapering and how that may impact stocks in the near future as the central bank attempts to not worry investors.  Bitcoin approaches all time high as cryptos climb higher After some time spent consolidating in the $60,000 range, Bitcoin has managed to break through the upper limit of the trading range and resume the upward move with the main crypto currency approaching it's recently reached all time high as it trades around $66,000. This positive sentiment is echoed across the majority of other coins with the total market cap once again nearing the $3 trillion mark and with Ethereum once again reaching a new high. While we have seen Bitcoin impact other crypto currencies in the past, a break past the previous all time high could lead to a significant increase in volatility and a potential domino effect as more investors enter the market or reallocate their funds. Download our Mobile Trading App:   Google Play   App Store  
US indices retreat as Tesla drags market

US indices retreat as Tesla drags market

Walid Koudmani Walid Koudmani 10.11.2021 13:14
US indices retreat as Tesla drags market Wall Street interrupted a winning series with the S&P 500 index closing lower for the first time in 9 days and with the Nasdaq being the worst performing index after it was pressured significantly by the plunge of Tesla shares, caused partly by comments made by the CEO Elon Musk in which he indicated the possibility of selling a portion of his shares if a twitter poll were to decide accordingly.  Today, investors await US CPI inflation data which is expected to show an increase of 5.8% y/y and which could potentially influence the FED to further adjust it's QE tapering after it's announcement in the most recent central bank meeting. Furthermore, earnings reports from Disney and Beyond Meat could also be worth keeping an eye on after this earnings season has proved to be surprisingly positive for the majority of companies.  Marks and Spencer posts strong Q3 results  M&S H1 results indicated a significant rebound in sales and a performance recovery which could be attributed to underlying improvements in all main businesses along with a reduction of net debt as the company has managed to effectively adapt to changing conditions. Better than expected financial results, along with a clear plan to continue expanding thanks to more partnerships and store openings, continue to provide reassurance to investors who may be finally looking past the noticeable impact the pandemic has had on the business in recent times.
Profiting on Hot Inflation

Profiting on Hot Inflation

Monica Kingsley Monica Kingsley 10.11.2021 16:08
S&P 500 pause finally went from sideways to down, and might not be over yet. Credit markets aren‘t nearly totally weak – tech simply had to pause, so did semiconductors, and the Tesla downswing took its toll. Value though recovered the intraday downside, and VIX retreated from its daily highs – that may be all it can muster. I‘m looking primarily at bond markets for clues, and these reacted to the PPI figures with further decline in yields.At the same, inflation expectations are moving higher – the more you shorten the maturity, the higher they go, let alone RINF, their key ETF. Markets will be proven very wrong about the transitory inflation complacency – inflation rates aren‘t going to decline if you just leave them alone. And taper coupled with rate hikes hesitancy won‘t do the trick either.S&P 500 is still primed to go higher – the only question is the shape of the current consolidation. Liquidity is still ample, the banking sector is strong, and the Russell 2000 isn‘t really retreating. As stated yesterday:(…) The correct view of the stock market action is one of microrotations unfolding in a weakening environment – one increasingly fraught with downside risks. To be clear, I‘m not looking for a sizable correction, but a very modest one both in time and price. It‘s a question of time, and I think it would be driven by tech weakness as the sector has reached lofty levels. It‘ll go higher over time still, but this is the time for value and smallcaps in the medium term.Precious metals are consolidating – it‘s almost a pre-CPI ritual, but under the surface, the pressure to go higher keeps building. I‘m looking for a strong Dec in gold and silver, with unyielding oil and copper gradually waking up. Cryptos aren‘t taking prisoners either.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 finally declined, and the very short-term picture is unclear – is the dip about to continue, or more sideways trading before taking on prior highs? It‘s a coin toss.Credit MarketsHYG recouped some of the prior downside, but the LQD and TLT upswings give an impression of risk-off environment. Sharply declining yields aren‘t necessarily positive for stocks, and such is the case today.Gold, Silver and MinersGold and silver look like briefly pausing before the upswing continues – miners are pulling ahead, and the ever more negative real rates are powering it all.Crude OilCrude oil bulls continue having the upper hand, and oil sector is also pointing at higher black gold prices to come. Energy hasn‘t peaked by a long shot.CopperCopper went at odds with the CRB Index, but that‘s not a cause for concern. It‘ll take a while, but the red metal would swing upwards again.Bitcoin and EthereumBitcoin and Ethereum are briefly consolidating, and a fresh upswing is a question of shortening time. SummaryS&P 500 remains momentarily undecided, but the pullback shouldn‘t reach far on the downside – the bears are having an opportunity to strike on yet another hot inflation numbers. This isn‘t transitory really as I‘ve been telling you for almost 3 quarters already. Needless to say, the fire under real assets is being increasingly lit – more gains in commodities, precious metals and cryptos are ahead as inflations runs rampant on the Fed‘s watch.Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.
Market Quick Take - November 19, 2021

Market Quick Take - November 19, 2021

Saxo Bank Saxo Bank 19.11.2021 10:43
Summary:  Equity markets charged higher in the US session to close at new record highs, and the upside extended further in the futures market overnight. In FX, the recent USD strength eased slightly, while oil prices are creeping back higher despite the recent fears of strategic reserve releases. Markets are nervously awaiting the announcement of who US President Biden will nominate to head the Fed after the current Powell term ends in February. What is our trading focus? Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) - US equities pushed to new all-time highs yesterday led by technology stocks and strong macro figures across manufacturing surveys and job market data such as jobless claims. Nasdaq 100 futures are trading around the 16,560 level in early European trading with the 16,500 being the intraday day support level. A recent survey among institutional investors shows that a majority is believing in the transitory inflation narrative which can help explain why investors in equities are looking through the latest inflation pressures. EURUSD and EURGBP – the beleaguered euro finally bounced back a bit after its recent remarkable slide, although it is tough to see what could engineer a reversal of the move below the 1.1500 level, which is the key chart resistance now, although Biden announcing Brainard as his pick to head the Fed next February could drive considerable short-term volatility. To stop the euro from a persistent slide, we would need a very different tone from the ECB than it has delivered recently, with no real opportunity to do so until the December 16 ECB meeting. With power prices and a new Covid wave weighing on the outlook, the ECB will very likely be happy to stay firmly dovish. USDJPY – the highs for the cycle near the psychologically important 115.00 look safe as long as US treasury yields at the longer end of the curve remain rangebound, but trading above that level could get volatile if it is broken, as some options structures may be linked to its breaking or not breaking. The next test for the price action is clearly the Fed Chair nomination that appears imminent – possibly today or over the weekend (more below in What are we watching next?). Gold (XAUUSD) has spent the week trading within a relatively narrow range between $1850 and $1870 as it awaits a fresh catalyst following last week’s breakout. The impressive rally that occurred despite headwind from a stronger dollar has stalled with bond yields picking up and the market wondering how the US Federal Reserve will manage the current inflation spike. Silver and especially platinum have both struggled to keep up with gold while ETF investors have yet to show any interest in accumulating exposure. All developments raising the risk of a retracement towards the $1830-35 key area of support. Crude oil (OILUKJAN22 & OILUSDEC21) managed to recover yesterday after the market brushed aside the potential negative price impact of a US SPR release. US attempts to attract wider support from other major importing countries seems to have fallen flat, except for China who is “working” on a release. Having dropped more than five dollars since speculation began, the market has concluded for now that the price impact of a release could be limited. The market, however, may still have to deal with the recent updates from EIA and IEA, in which they both forecast current tight market conditions could start to ease early next year as well as renewed Covid-related reductions in mobility. US Treasuries (IEF, TLT). Yesterday’s 10-year US TIPS auction stopped through, pricing at a record low yield at -1.145%. It is a signal that investors are ever more concerned about inflation risk.  The Treasury also sold 4-week and 8-week T-Bills. While the latter was priced in line with the Reverse Repurchase facility, 4-week T-Bills priced with a yield of 0.11%, more than double the RRP rate. As we approach the day in which the Treasury will run out of cash, we expect volatility in the money market to increase, while long-term yields will remain compressed as they will serve as a safe haven. In the meantime, the move index continues to rise indicating that the bond market remains on the hedge. What is going on? Central Bank of Turkey cut another 100 basis points from the policy rate, lira plunge extends. The Turkish lira has lost more than 10% versus the US dollar this week and trades well over 11.00 after Turkish President Erdogan earlier this week declared himself once again against high interest rates, which he believes cause inflation. Central bank chief Kavcioglu, who is seen as doing Erdogan’s bidding, cut rates for a third time by 1.0% to take the policy rate to 15%, but with the Turkish lira losing over 10% this week alone and more than 30% since Erdogan fired the prior more hawkish central bank head in favour of Kavcioglu, inflation will run far beyond the rate. Not even some guidance that the easing cycle may conclude in December was enough to halt the lira’s slide. US Nov. Philly Fed survey hits 39.0, a very hot reading and fourth highest ever - with Prices Paid at 80 and just missing the 42-year high of 80.7 in June, although the Prices Received was at 62.9, the highest since 1974. Special survey questions in the Novemer  survey included one on inflation expectations, with firms expecting a median 5.3% increase in their own prices, and an increase in wages of 4.8%. The median forecast for 10-year inflation was 3.5%, up from the 3.0% the last time the question was asked in August. The Bloomberg Agriculture Index hit a fresh five-year high this week with food prices likely to stay high in 2022 with labor shortages, La Ninã weather impacts, surging cost of fertilizers being the common denominator across the sector. Recent gains being led by coffee, which we highlighted earlier in the week as a commodity currently seeing multiple price supportive developments. Wheat is heading for a nine-year high in Chicago while hitting record highs in Europe with inventories tumbling amid strong demand from importers and now also a rain threat to the soon-to-be harvested Australian crop. Soybeans have seen a strong bounce after the latest WASDE report showed a tighter than expected outlook for the coming year, and following a recent rush of Chinese buying from the US and South America. Apple doubles down on self-driving cars. The company is aiming to develop fully autonomous driving capabilities for cars by 2025 under the project name Titan. Apple has developed its own chip and is aiming to soon have a car on the roads for testing. However, delivering self-driving cars is a difficult endeavor with Uber Technologies having sold its unit and Waymo (Google’s unit) has been struck by fatigue and key people leaving the project. Tesla is also still struggling to deliver self-driving cars. What are we watching next? Who will US President Biden nominate to head the Fed next February? Powell is still seen as more likely to get the nod that Brainard by roughly two to one, and this Fed Chair nomination issue is hanging over the markets, as the current Fed chair term ends in early February and from comments made earlier this week, an announcement could be made any day now. One uncertainty that would come with a Brainard nomination is the potential difficulty of having her nomination approved by the Senate. The nomination news could generate significant short-term volatility on the choice of the nominally more dovish Lael Brainard over current Fed Chair Powell, though we see little difference in the medium-longer term implications for monetary policy, and the Fed is likely to get a prominent new regulatory role either way (under Brainard or someone else if she is nominated to replace Powell). Vote on $1.7 trillion US fiscal bill today in the House of Representatives after the Congressional Budget office said the bill, which focuses on social spending and climate initiatives, would add some $367 billion to the US Federal deficit (around 1.5% of current US nominal GDP) over the next 10 years. Earnings Watch – there are no important earnings today and this earnings week has been good in the US and Europe, while a bit more mixed among Chinese companies. The list below shows earnings releases next week. Monday: Sino Pharmaceutical, Prosus, Zoom Video, Agilent TechnologiesTuesday: Xiaomi, Kuaishou Technology, Compass Group, Medtronic, Analog Devices, Autodesk, VMWare, Dell Technologies, XPeng, HP, Best Buy, Dollar TreeWednesday: DeereThursday: AdevintaFriday: Meituan, Pinduoduo Economic calendar highlights for today (times GMT) 0830 – ECB President Lagarde to speak1200 – UK Bank of England Chief Economist Huw Pill to speak1330 – Canada Sep. Retail Sales1715 – US Fed Vice Chair Clarida to speak on global monetary policy coordination Follow SaxoStrats on the daily Saxo Markets Call on your favorite podcast app: Apple Spotify Soundcloud Sticher
Global Markets In Times Of Affection Of Situation In Eastern Europe

On the radar this week...

Chris Weston Chris Weston 22.11.2021 08:18
Powell vs Brainard Fed chair nomination  Covid trends and restrictions in Europe US core PCE inflation (Thursday at 2 am AEDT) RBNZ and Riksbank central bank meeting US cash markets shut Thursday for Thanksgiving (Pepperstone US equity indices still open)  Eurozone PMI (Tuesday 20:00aedt) – ECB speakers in play BoE speakers to drive the GBP – will they cast doubt on a December hike? With Covid risks on the rise in Europe and ultimately restrictions being implemented we’ve seen renewed selling interest in the EUR, and the oil-exporting currencies (NOK, CAD, MXN). Certainly, the NOK was the weakest G10 currency last week, and GBPNOK has been a great long position – a pair to trade this week, but consider it is up for 9 straight days and has appreciated 5.2% since late October.  I questioned last week if the divergence in EURCHF plays out, and the break of 1.05 negates that, suggesting staying short this cross for now as the CHF is still a preferred safe-haven.  EURUSD has been in free-fall EURUSD has been in free-fall and will likely get the lion’s share of attention from clients looking for a play on growing restrictions and tensions across Europe. The pair has lost 3.5% since rejecting the 50-day MA on 28 Oct and has consistently been printing lower lows since May – predominantly driven by central bank divergence and a growing premium of 2-year US Treasuries over German 2yr - with the spread blowing out from 78bp to 128bp, in favour of USD. For momentum, trend followers and tactical traders, short EUR remains attractive here.  It will be interesting to see if we see any pickup in shorting activity in EU equities – notably the GER40, with the German govt warning of lockdowns ahead. A market at all-time highs (like the GER40) is a tough one to short, but if this starts to roll over then I’d go along for a day trade. There is a raft of ECB speakers also to focus on, notably with President Lagarde due to speak on Friday.  Playing restrictions through crude While we can play crude moves in the FX, equity and ETF space, outright shorts in crude have been looking compelling. Although we see SpotCrude now sitting on huge horizontal support and a break here brings in the 50-day MA. Of course, as oil and gasoline fall, the prospect of a release of the SPR (Strategic Petroleum Reserves) diminishes, however, the Biden administration could use this move lower move to their advantage and capitalize to keep the pressure on.  (SpotCrude daily) A rise in restrictions also means market neutral strategies (long/short) should continue to work, and long tech/short energy has been popular. We can express this in our ETF complex, with the XOP ETF (oil and gas explorers) -8.1% last week and that works as a high beta short leg. Long IUSG (growth) or the QQQ ETF against this would be a good proxy on the opposing leg. In fact, looking at the moves in Apple, Nvidia, Alphabet and Amazon, and we can see these ‘safe haven’ stocks are working well again, as is Tesla although for different reasons.  Stocks for the trend-followers For the ‘buy strong’ crowd, I have scanned our equity universe for names above both their 5- and 20-day MA AND at 52-week highs. Pull up a daily chart of any of these names - they should nearly always start at the bottom left, and end top right. Playing the RBNZ meeting tactically By way of event risks, the RBNZ meeting (Wed 12:00 AEDT) is one of the more interesting events to focus on. Will the RBNZ raise by 25bp or 50bp? That is the question, and of 19 calls from economists (surveyed by Bloomberg) we see 17 calling for a 25bp hike – yet the markets are fully pricing not just a 25bp hike but a 43% chance of 50bp – from a very simplistic perceptive if the RBNZ hike by ‘just’ 25bp, choosing a path of least regret, then we could see a quick 25- to 30-pip move lower in the NZD. The focus then turns to the outlook and whether the 8 further hikes priced over the coming 12 months seems to be one shared by the RBNZ.  Traders have been keen to play NZD strength via AUD, as it is more a relative play and doesn’t carry the risk on/off vibe, which you get with the USD and JPY. I’d be using strength in AUDNZD as an opportunity to initiate shorts, especially with views that RBNZ Gov Orr could talk up the possibility of inter-meeting rate hikes.  GBP to be guided by the BoE Chief The GBP is always a play clients gravitate to, with GBPUSD and EURGBP always two of the most actively traded instruments in our universe. A 15bp hike is priced for the 16 Dec BoE meeting after last week’s UK employment and inflation data, but consider we also get UK PMI data (Tuesday 20:30 AEDT), and arguably, more importantly, speeches from BoE Governor Bailey and chief economist Huw Pill – perhaps this time around expectations of hikes can be better guided – although, a bit of uncertainty into central bank meetings is very pre-2008 and makes things a little spicy/interesting.  (BoE speakers this week) GBPUSD 1-week implied volatility is hardly screaming movement, and at 6.5% sits at the 10th percentile of its 12-month range. The implied move is close to 130pips, so the range at this juncture (with a 68.2% level of confidence), although I multiple this by 0.8 to get closer to the options breakeven rate. So at this stage, 100 pips (higher or lower) is the sort of move the street is looking for over the coming five days, putting a range of 1.3557 to 1.3349 in play – one for the mean reversion players. Personally, I would let it run a bit as that volatility seems a little low, and a break of 1.3400 could see volatility pick up. I’d certainly be looking for downside if that gave way.  Happy trading.
Interest rate sensitivity is back in town haunting technology stocks

Interest rate sensitivity is back in town haunting technology stocks

Peter Garnry Peter Garnry 23.11.2021 16:23
Summary:  Interest rate sensitivity came back roaring yesterday pushing down all of our growth baskets. Yesterday's move shows the potential for a correction in US technology stocks should the US 10-year yield continue to rapidly advance towards the highs from March. We also show how the Nasdaq 100 and STOXX 600 move in opposite direction during large up or down days in the US 10-year yield. Growth baskets look awfully vulnerable Yesterday’s move in the US 10-year yield of 8 basis points made it the 10th biggest move higher in US yields this year. Back in March when technology stocks were under pressure we wrote a lot about interest rate sensitivity in growth stocks as their present value are derived from expected cash flows further into the future than the typical MSCI World company. If interest rates rise faster than future growth expectations then the net effect is negative on the present value and more so for growth stocks as they have a higher duration. We saw downside beta (higher sensitivity) in all of our growth equity baskets with the gaming basket down 2.3% and the worst performers being the E-commerce and Crypto & Blockchain baskets down 4.2% and 5.1% respectively. This tells you a lot about the sensitivity and given the drawdown in technology stocks back in March, we could easily experience a 15-20% drawdown in technology stocks. The local highs from March in the US 10-year yield is the key level to watch for a breakout and a new trading environment. With all the options activity in Tesla dwarfing the combined options activity in FTSE 100 constituents, we believe Tesla will be at the center of the next risk-off move in technology. Nasdaq 100 vs STOXX 600 are yin and yang of interest rates We have previously tried to calculate the interest rate sensitivity, but this time we are pursuing a different approach. We look at the past 231 trading days this year and group the 1-day difference in the US 10-year yield into deciles. In order to measure interest rate sensitivity we calculate daily excess log returns for Nasdaq 100, S&P 500 and STOXX 600 against the MSCI World Index and compute their average daily excess return for each decile. As the barplot shows, there is significant negative excess return in Nasdaq 100 in the 1st decile (the 10% days with the highest positive difference in US 10-year yield) and significant positive excess return in STOXX 600. This makes perfect sense because Nasdaq 100 is high duration growth stocks and STOXX 600 has a clear value tilt towards financials, energy and mining which exhibit much lower duration. The pattern is completely reversed in the 10th decline (days with large negative difference in US 10-year yield). The other eight deciles do not show the same clear spread between Nasdaq 100 and STOXX 600. In other words, if interest rates suddenly move aggressively higher then growth portfolio will take a serious hit and hence why we recommend investors to improve the balance between growth and value stocks, or said differently reduce the equity duration.
Market Digest Friday 10 Dec; hold your breath, big elements to watch inflation, volatility and iron ore

Market Digest Friday 10 Dec; hold your breath, big elements to watch inflation, volatility and iron ore

Jessica Amir Jessica Amir 10.12.2021 10:34
Equities 2021-12-10 00:00 4 minutes to read Summary:  Markets are facing speed bumps again as investors await key inflationary numbers and the Feds meeting outcome, key catalyst that will ultimately change market dynamics, with fiscal stimulus being taking away. The US benchmark the top 500 stocks fell from record high territory, falling for the first time in 4 days, while the ASX200 fell for the second day, dipping below its 50 day moving average. Growth names are being sold down and safe haven assets, bonds, the USD, the JPY, are gaining appeal. It is for three important reasons. Here is what you need to know and consider, plus the five elements to watch today. Firstly, investors are holding their breath ahead of key events: Friday’s US inflation data (tipped to show inflation rose 6.8% YOY in November), plus we are also seeing investors pre-empt that the Federal Reserve next week, will map out tapering and interest rate hikes for 2022. A poll by Reuters showed that 30 of the 36 economists expect the Fed to hike rates sooner than thought, rising rates four times from the third quarter of the year 2022 to the second quarter of 2023 (expecting rates to be 1.25-1.50%). This explains why investors took profits from nine of the major 11 US sectors overnight. So growth stocks and sectors that thrive in low interest rates; consumer discretionary, real estate and information technology, saw the most selling as a result. From a stock perspective Tesla fell 6%, Semiconductor giant Advanced Micro Devices, and Etsy-the e-commerce vintage store, both fell 5%, and chip maker Nvidia fell 4%. If you look at Saxo Markets themes that we track, you can also see the most money on a month-on-month basis, has come out of semiconductors, while the other themes we track are posting monthly gains. Secondly, it’s critical to be aware, the UK Prime Minister announced restrictions to curb Omicron’s spread -  so the UK entered new work-from-home guidance, that could cost the UK economy $2.6 billion a month (according to Bloomberg). Meanwhile, a study by a Japanese scientist found the new variant to be 4.2 times more transmissible in its early stage than delta. As such some companies are responding like Lyft saying their workforce can work remotely in 2022, while Jefferies asked staffers to WFH. This means, travel and tourism stocks could see short term pressure, Australian and US stocks that are exposed to the UK could also see pressure, while oil could see demand weakness here. Plus, it could be time to again rethink exposure to the office property sector, as it’s a likely to remain squeezed, while industrial and logistics real estate remain supported given the likely new shift to WFH. Thirdly – be aware of volatility. A measure of this, VIX CBOE Volatility Index rose for the first time in four days, rising back above the 50 day average. Volatility has fallen from its 12-month high and remains contained right now as Pfizer said its vaccine can neutralize the new COVID strain Omicron after three doses (two doses offer protection again severe disease). However, keep your ears to the ground. If tomorrow’s inflation data from the US is worse than expected, expect volatility to spike, and growth stocks to see further selling and expect safe haven assets (USD, bonds, USDJPY) to gain more attraction. Aside from the above – here’s 5 things to watch today; Firstly - let's go over Fortescue Metals (FMG) 1.FMG’s CEO, Elizabeth Gains just announced she is standing down, right in the thick of iron ore having a murky outlook. It’s not been an easy 12 month for FMG holders. FMG trades 7% lower this year, but it’s a far cry from its all-time high, down 30% from its peak as iron ore price remains in a bear market (down 40% from May). 2. FMG’s trading range has been restricted for two weeks as the world holds its breath to learn more about China’s property sector. FMG shares have broken out above their 50 day moving average but its trading has been even more so restricted over the last three days as its stock hit a key resistance level awaiting news from China. If good news comes, FMG could break out higher. But it looks murky. Majority of FMG revenue (94%) comes from iron ore, and its majority sold to China (90%) (unlike BHP that now diversifies its sales to other countries). And now… we are getting mixed signals from China, making iron ore’s outlook look hazy. 3. On the positive side; week-on-week Australian iron ore exports are up. China has increased its monthly imports of Australian iron ore in November, more than expected. This has supported the iron ore price rising 8.9% this week. 3. But on the negative side - Evergrande, one of China’s biggest property developers was just officially downgraded -labelled a defaulter by Fitch Ratings after failing to meet two coupon payments after a grace period expired Monday. This may now trigger cross defaults on Evergrande’s $19.2 billion of dollar debt. Also at the same time JP Morgan downgraded its outlook for iron ore expecting the iron ore to fall 7% to $92, while Citi expects seaborne iron ore prices to fall 60-$80/t in 2022 on Chinese policy changes. 4. However, Fortescue has been in the news this week, for its shift to a green future. Was this a tactic? A smoke Bomb? Yesterday FMG announced its Future Industries department signed a pact with the Indonesia to explore hydrogen projects. The day before Fortescue Future Industries (FFI) and AGL Energy (AGL) teamed up to explore repurposing NSW coal-fired power plants and turning them into green hydrogen production facilities – to hopefully create renewable electricity production, 250 megawatts (which will generate 30,000 tonnes of green hydrogen per year). AGL and FMG will undertake a feasibility study to repurpose AGL’s Liddell and Bayswater power stations, that both accounted for 40% of NSW’s carbon dioxide emissions. Sheesh. Secondly  – Australian analyst rating changes to consider ANZ AU: Reiterated as a Bell Potter BUY, PT $30.00, RRL AU: Regis Resources Raised to Outperform at RBC; PT A$2.50 EBO NZ: EBOS Raised to Outperform at Credit Suisse; PT NZ$43.14 FMG AU: JPMorgan downgrades FMG from Overweight to Neutral, dropping its PT from $22 to $20. RIO AU: JPMorgan downgrades RIO from Overweight to Neutral, dropping its PT from 113.00 to 102. MIN AU:  Reiterated as JPMorgan hold/neutral, dropping its PT from $47 to $40 Thirdly  - what else to watch today Annual General Meetings: HMC AU, PDL AU, PH2 AU, SOL AU Other Shareholder Events: AOF AU, HMC AU THL NZ: Tourism Holdings Halted in NZ Pending Proposed Transaction ADPZ NA: APG Buys 16.8% Stake in Ausgrid from AustralianSuper EBO NZ: Ebos Successfully Raises A$642m From Share Placement Fourthly - Economic news out 8:30am: (NZ) Nov. Business NZ Manufacturing PMI, prior 54.3 8:45am: (NZ) Nov. Card Spending Total MoM, prior 9.5% 8:45am: (NZ) Nov. Card Spending Retail MoM, prior 10.1% Fifthly - Other news to keep in mind: Australia Seen Facing Steeper Borrowing Costs If Slow on Climate RBA Likely to Stick With QE Until Election Over, BofA Says      ---   Markets - the numbersUS Major indices fell: S&P 500 -0.7% Nasdaq -1.7% Europe indices closed lower: Euro Stoxx 50 lost 0.6%,London’s FTSE 100 lost 0.2% flat, Germany’s DAX fell 0.3%Asian markets closed mixed: Japan’s Nikkei fell 0.5%, Hong Kong’s Hang Seng rose 1.1%, China’s CSI 300 rose 1.7%. Yesterday Australia’s ASX200 fell 0.3% Futures: ASX200 hints of a 0.14% fall today Commodities: Iron ore rose 1.3% to $110.50. Gold fell 0.4%, WTI crude fell 2% to  $70.94 per barrel. Copper fell 1.4% Currencies: Aussie dollar trades 0.4% lower at 0.7146 US. Kiwi down 0.3% to 0.6788 per US$ Bonds: U.S. 10-year yield fell 3.5bps to 1.4871%,Australia 3-year bond yield fell 0.8bps to 0.95%, Australia 10-year bond yield rose 6bps to 1.68%
Tesla (TSLA) Stock Price and Forecast: Will Tesla fall to $900?

Tesla (TSLA) Stock Price and Forecast: Will Tesla fall to $900?

FXStreet News FXStreet News 06.12.2021 19:29
Tesla (TSLA) stock continues to slide as Friday sees 6% loss. Tesla (TSLA) now nearing key $1,000 support and pivot. Tesla (TSLA) is likely to move quickly to $910 if the stock breaches $1,000. Tesla stock continues to remain under increased selling pressure as markets take a risk-off approach in the current environment. The emergence of the omicron covid variant appears to have put the brakes on the latest rally but the move had become overdone anyway and some correction was necessary. While 2021 has been the year to buy dips, is this one different? We think not and reckon now is the time to wade back in but we take a differing approach here with Tesla (TSLA). The stock has had a standout 2021 and is likely to suffer from now into year-end. The temptation of profit taking is just too strong here. Technically $1,000 is key. Holding will put in place a bullish double bottom and make us change our call but we, for now, remain bearish and see $1,000 breaking, leading to a sharp acceleration to $910. Our daily chart for Tesla (TSLA) above shows just how much pain the stock has taken this past couple of weeks. Tesla was nearing gains of 80% for 2021 in early November but now is back to a gain of 45% for the year so far. Still a strong outperformance against the benchmarks. Tesla (TSLA) stock news The most anticipated of product launches, that of the cybertruck, has been delayed to the end of 2022 according to a Twitter post from CEO Elon Musk. He gave more details about the proposed cybertruck saying it will have four motors, one for each wheel, and will be able to crab sideways. Elon Musk will give more details on Tesla's next earnings call. China sees a recall for some Tesla cars with a report in Electrek stating "According to a statement from China’s State Administration for Market Regulation (SAMR), Tesla Shanghai filed a recall plan for 21,599 Model Y EVs manufactured in the country. The automaker cited issues pertaining to the strength of front and rear steering knuckles, stating they may not meet the automaker’s design requirements". Also of note is Elon Musk selling another $1 billion worth of stock, while Cathie Wood of ARK also is still trimming her funds holding in the name. Tesla (TSLA) stock forecast $1,000 is huge, break and it is likely straight to $910. Hold and we would expect more all-time highs before year-end. It is that simple in our view. This one is big. $910 closes the gap from the whole Hertz parabolic move and markets love to fill gaps. Holding on the other hand confirms a double bottom which is a powerful bullish reversal signal. We would need some confirmation with either a stochastic or MACD crossover or a bullish divergence from the RSI. So far we have none of these, making a break lower more likely in our view.
TSLA Stock Price and Forecast: Why Tesla will break $1,200 on Wednesday

TSLA Stock Price and Forecast: Why Tesla will break $1,200 on Wednesday

FXStreet News FXStreet News 01.12.2021 16:20
Tesla emerges unscathed from another equity sell-off on Tuesday. TSLA is likely to break higher on Wednesday as buyers return. Tesla CEO Elon Musk takes a bite out of Apple. Tesla (TSLA) stock can do no wrong in 2021, and it avoided another market meltdown on Tuesday. While panic ensued following Powell's remarks about the taper and inflation, TSLA held firmly in the green. Equity indices finished nearly 2% lower on Tuesday, but Tesla shares closed at $1,144.76 for a gain of 0.7%. This was another strong outperformance for a stock that is up 62% year to date. Contrast that with the Nasdaq, up 25 % for 2021, and the S&P 500, up a similar amount. 2021 has been the year of the electric vehicle, and Tesla paved the way for others to follow, notably Rivian (RIVN) and Lucid (LCID). Our chart above shows the strong correlation between Tesla and Lucid with both stocks putting in a stellar second half for 2021. Tesla (TSLA) stock news Elon Musk is nothing if not entertaining, and on a slow news day for Tesla he livened things up by taking a pop on Twitter toward Apple. Don’t waste your money on that silly Apple Cloth, buy our whistle instead! — Elon Musk (@elonmusk) December 1, 2021 The Apple cloth he is referring to is a polishing cloth available from Apple for $19. Tesla recently launched a Cyberwhistle for what reason? Who knows, but it is currently sold out. At $50 for a whistle, it is not exactly cheap. It seems people just love a Tesla product. Apple was no slouch either on Tuesday as the stock set all-time highs. Tesla (TSLA) stock forecast The triangle formation still holds and a breakout is awaited. A triangle pattern is usually a continuation pattern, and Wednesday could provide the catalyst to break higher. The stock has consolidated well despite some strong headwinds: notably, Elon Musk selling a Cybertruck load of stock, and Tesla not performing well in a recent reliability test. It did however score highly on customer satisfaction, and investor satisfaction is also high given the strong performance. We expect more all-time highs this week even with the surrounding Omicron volatility. Our view will change if Tesla cracked below key support at $1,063. TSLA 1-day chart
TSLA Stock Price and Forecast: Why is Tesla is going to break below $1,000?

TSLA Stock Price and Forecast: Why is Tesla is going to break below $1,000?

FXStreet News FXStreet News 10.12.2021 16:09
Tesla stock underperforms strongly on Thursday as continued profit-taking strikes blow. Equity markets remain nervous as VIX inches up again on Thursday and indices lose ground. TSLA also feels pressure from more sales by CEO Elon Musk. Tesla (TSLA) shares lost a lot of ground on Thursday as investors cashed in recent gains ahead of the year end. TSLA has to be included in practically all indices, passive and active funds, and the temptation to book some strong profits ahead of the new year is just too tempting. Added to this is the strong retail investor base who will also be much more inclined to sell out before the holiday season, and the stock has been coming under heavy selling pressure. Call options have been a strong feature of the rise in Tesla this year, especially the last six months. Call option volumes have been steadily decreasing. Tesla (TSLA) stock chart, 15-minute As we can see from the chart above, December has not been kind to Tesla stock so far, and we see this continuing. Tesla (TSLA) stock news Added to profit-taking and Elon Musk selling stock was news yesterday that the National Highway Traffic Safety Administration (NHTSA) is scrutinizing a feature in some Tesla versions that allow users to play video games in the car. Obviously, this would be a distraction to the driver. We are assuming it is a passenger feature but nonetheless still distracting. Elon Musk sold another $963 million worth of Tesla this week, and Cathie Wood of ARK is still selling small amounts. Tesla (TSLA) stock forecast Somehow $1,000 is still holding in there as support, but surely today is the day when that will finally break. Then it is a pretty clear path in terms of support straight to $910. $1,000 is psychological, but it has been tested quite a few times and the more a level is tested the weaker it becomes. Tesla is putting in a series of lower highs and knocking on the door of $1,000 each time. So the bounce from $1,000 can be said to be weaker each time. We also have a falling Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) confirming the price action. Tesla (TSLA) stock chart, daily
Will Stocks Continue Their Rally?

Will Stocks Continue Their Rally?

Paul Rejczak Paul Rejczak 13.12.2021 15:37
  The S&P 500 index got back above the 4,700 level on Friday after gaining almost 1%. The only way is up now? For in-depth technical analysis of various stocks and a recap of today's Stock Trading Alert we encourage you to watch today's video. Nasdaq 100 Remains Close to the 16,400 Level Let’s take a look at the Nasdaq 100 chart. The technology index got back to the 16,400 level last week. It is the nearest important resistance level, marked by some previous local highs. Tech stocks remain relatively weaker, as the Nasdaq 100 is still well below the Nov. 22 record high of 16,764.85. Conclusion The S&P 500 index will likely slightly extend its last week’s advances this morning. However we may see a short-term profit-taking action at some point. There have been no confirmed short-term negative signals so far, and we may see an attempt at getting back to the late November record high. Here’s the breakdown: The S&P 500 is expected to open slightly higher this morning but we may see a consolidation above the 4,700 level. Our short-position is very close a stop-loss level, and we’ll close it if it breaks above it again. Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Paul Rejczak,Stock Trading StrategistSunshine Profits: Effective Investments through Diligence and Care * * * * * The information above represents analyses and opinions of Paul Rejczak & Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. At the time of writing, we base our opinions and analyses on facts and data sourced from respective essays and their authors. Although formed on top of careful research and reputably accurate sources, Paul Rejczak and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Rejczak is not a Registered Securities Advisor. By reading his reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Paul Rejczak, Sunshine Profits' employees, affiliates as well as their family members may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Tesla (TSLA) Stock Price and Forecast: Will Tesla break $1,000

Tesla (TSLA) Stock Price and Forecast: Will Tesla break $1,000

FXStreet News FXStreet News 13.12.2021 16:09
Tesla (TSLA) just cannot break below key support at $1,000. Equity markets remain supportive with more all-time highs for the indices. Tesla (TSLA) is still seeing selling from CEO Elon Musk. Tesla shares are still holding above the key $1,000 level as we approach the final lap of the year. Tesla (TSLA) is up an impressive 44% so far this year in what has been the year of the mega tech names. Indeed Goldman Sachs notes this morning that five stocks account for more than half of the S&P's return since the end of April. Those names are all familiar big tech, Tesla, Microsoft, Alphabet, Nvidia, and Apple. This so-called narrowing of the returns or a lack of market breadth is often cited as a bearish factor. Goldman adds that the market cap of the top 10 stocks in the S&P make up 31% of the total S&P 500 market cap. That is the highest since 1980. While all this is beginning to sound increasingly alarmist fear not Goldman said. They estimate that this narrowing trend is set to continue and to stick with growth stocks into 2022. Tesla (TSLA) should see more benefits if that strategy is maintained, adding further to the large headache the stock gives value to investors. Price/earnings multiples are out the window with Tesla. It is pure momentum. Tesla (TSLA) chart, 15 minute Tesla (TSLA) stock news Not exactly stock specific but Elon Musk is Time magazine Person of the Year for 2021. Time CEO said, "Person of the Year is a marker of influence, and few individuals have had more influence than Musk on life on Earth, and potentially life off Earth too.".In relation to EV's the CEO added: "a market that Musk almost single-handedly created, seeing long before others the demand for clean-energy transportation that the world’s climate crisis would eventually propel." In other more specific news, Tesla has had to stop accepting orders for new Model S and Model x orders outside North America, according to electrek. Tesla is rumored to have a large backlog of orders. Demand obviously remains strong as more and more countries offer incentives for electric vehicle purchases. Tesla (TSLA) stock forecast We are still forecasting Tesla to return to the gap at $910 before year-end. $1,000 held again on Friday but the level is seeing increasing bombardment. The more a level is tested the weaker it becomes. We fear the next time it will go and that will signal a sharp move to $910. The stock is already well capped by the 9 and 21-day moving averages and only a break above $1063 will change our bearish stance. Tesla, daily chart
Market Quick Take - December 14, 2021

Market Quick Take - December 14, 2021

Saxo Strategy Team Saxo Strategy Team 14.12.2021 11:57
Macro 2021-12-14 08:35 6 minutes to read Summary:  Risk sentiment soured yesterday, with some attributing the market nervousness to uncertainty on how hawkish a pivot the Fed is set to make at the FOMC tomorrow, although Fed rate expectations for next year as expressed in the most liquid futures have eased from recent highs. That meeting is the most significant major macro event risk for the 2021 calendar year, although important ECB and BoE meetings are set for Thursday. What is our trading focus? Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) - yesterday was a very disappointing session for US technology stocks with Nasdaq 100 futures looking to push higher early during the session but ended on the lowest close in four trading sessions. Nasdaq 100 futures are trading around the 16,110 level this morning with the 50-day average around the 15,810 level as the key support level to watch on the downside should risk-off continue. EURUSD – the EURUSD supermajor continues to coil in a tight range ahead of the FOMC meeting tomorrow and ECB meeting on Thursday, both of which are set to bring refreshed forecasts for the economy and policy. The FOMC meeting is likely to carry more weight in terms of the market reaction, especially if the Fed waxes more hawkish than expected (more below) and takes Fed rate expectations for next year to new highs for the cycle. The lines in the sand on the chart include the 1.1186 lows of November, while the recent pivot highs of 1.1355 and 1.1384 bar the upside, with 1.1500 a more structural resistance/pivot zone. AUDUSD – watching the US dollar closely over the next couple of sessions, particularly in the wake of tomorrow’s FOMC meeting and what it brings in the way of a crystallization of the Fed’s hawkish shift (more below) and in the market reaction. If the meeting brings a spike in market volatility, traditionally risk-correlated currencies like the Aussie could show high beta to swings in the US dollar in either direction (I.e., if the Fed waxes more hawkish than expected and this triggers risk-off and a stronger USD). AUDUSD recently broke down through the prior 2021 lows near 0.7100 and tested the huge 0.7000 level before staging a sharp bounce. That 0.7000 level could serve as a kind of “bull-bear” line from here. Crude oil (OILUKFEB22 & OILUSJAN22) has settled into a relatively narrow range with Brent finding resistance at $76, the 21-day moving average while support remains the 200-day moving average at $73.15. OPEC in its monthly oil market report maintained their 4.2 million barrels per day demand growth outlook for 2022 with current omicron-related weakness being offset by a strong recovery during Q1. The Saudi energy minister said the energy transition will cause an oil-price spike later this decade while also warning traders against shorting the market at a time where large speculators have reduced their Brent crude oil long to a 13-month low. On tap today we have IEA’s Monthly Oil Market Report. Gold (XAUUSD) remains stuck just below its 200-day moving average at $1794 with focus on what 20 central bank meetings this week will deliver in terms of inflation fighting measures at a time where the omicron variant continues to cloud the economic outlook. With US inflation rising at the fastest pace since the 1980’s, Wednesday’s FOMC meeting remains the top event. The market is currently pricing in three rate hikes next year with the first one due around June. The other semi-investment metals of silver (XAGUSD) and platinum (XPTUSD) both struggling with the latter’s 850-dollar discount to gold, near a one year high, potentially deserving some attention. US Treasuries (TLH, TLT). The US yield curve bulled flatten yesterday with 10-year yields falling by 7bps to test support at 1.41%. To contribute to this move was news of the first omicron death in the UK, and the winding done of short US Treasury positions before the end of the year. Price action will remain volatile ahead of the Federal Reserve meeting, where Powell is expected to announce an acceleration of the pace of tapering. The focus is going to be also on the Dot plot, where longer term projections might be moved higher, pushing up the long part of the yield curve. However, long-term yields can move higher only that much, as omicron distortions will continue to keep them compressed. It looks likely that 10-year yields will continue to trade rangebound between 1.40% and 1.70% until the end of the year. European sovereign bonds (IS0L, BTP10). The Bund yield curve bull flattened yesterday led by safe-haven buying amid concerns over omicron. Italian BTPS gained the most as the market pushes back on interest rate hikes in 2022. The focus, however, continues to be on the ECB meeting on Thursday. An announcement of the end of the PEPP program in March 2022 is widely anticipated. What’s not clear is whether it will be announced that bond purchases will be compensated by another scheme, such as the APP. It is likely that the ECB will stall as members are torn between inflation and a new wave of Covid infections. If investors feel the support of the central bank is fading, European yields might resume their rise with the periphery and Italian BTPS leading the way. Yet, the move will be contained as yields will remain compressed by covid concerns. UK Gilts (IGLT, IGLS). The BOE might not deliver on a 10bps interest rate hike this week as members are divided concerning Covid restrictions. Michael Saunders, one of the most hawkish MPC members, said that he will need to think about it twice before voting for a rate hike. As expectations for interest rate hikes in the UK are the most aggressive among developed economies. It is possible that if the central bank does not hike, the Gilt yield curve will be steeping with short-term Gilts gaining the most as the market pushes back on next year’s rate expectations. What is going on? China reports first omicron variant case of covid - bringing fears of supply chain disruptions due to the country’s zero tolerance policy on virus cases that can mean profound shutdowns in response to outbreaks. Chinese property developers under new pressure, with the focus this time on Shimao Group Holdings, whose Hong-Kong listing is down over 75% this year and down over 30% over the last week on concerns that a deal between the company’s business units is a sign of financial stress for the company. The company’s 2030 USD-denominated bonds lost almost 13% overnight as the yield rose above 10%. Other Chinese property developer shares were also under pressure overnight. Tesla shares down 5% as growth stocks are under pressure. Tesla shares pushed below $1,000 yesterday adding further pressure to related assets in the Ark Innovation ETF and Bitcoin is also seen lower this morning. Elon Musk sold $907mn worth of shares yesterday according to a filing overnight in order to pay taxes on another round stock options that were exercised. Toyota finally pushes into EV. Japan’s largest carmaker wants to compete with Tesla and Volkswagen announcing $35bn of investments into battery electric vehicles showing the first sign that Toyota is acknowledging that this is the future of the industry. Toyota has so far pursued hybrids on the ground of being more economical, but this push into BEV with 30 new models validates BEVs once and for all, even though Toyota is still saying that it does not know which technology will win. US Harley-Davidson set to spin-off EV motorcycle unit – the plan to spin off Harley’s EV business via a SPAC saw Harley-Davidson shares spike 19% before surrendering most of the gains. Harley’s LiveWire EV business unit will combine with SPAC AEA-Bridges Impact to form a new publicly traded company. The move is meant to take advantage of the premium the market is willing to pay for pure-play EV companies. EU diplomats suggest time running out on Iran nuclear deal - as Iran is progressing rapidly toward enriching uranium for potential use in nuclear weapons. The diplomats worry that without a breakthrough soon, the original 2015 agreement “will very soon become an empty shell.” What are we watching next? The Wednesday FOMC as the year’s final major macro event risk. The FOMC meeting tomorrow is set to bring a very different monetary policy statement from the prior statement after the Fed’s clear pivot to inflation fighting mode. As well, the meeting will see an update of economic forecasts and interest rate policy forecasts (the “dot plot” in which 19 Fed members forecast where the Fed funds rate will likely be in 2022-24 and in the longer term). Most interesting will be the degree to which Fed members have raised their policy rate forecasts relative to what the market is predicting, which is for just under three rate hikes through the end of next year. Prior forecasts have generally come in lower than market expectations. The baseline expectation for the pace of QE “tapering”, or slowing of purchases, is that the Fed will double the pace of tapering, which would mean the Fed’s balance sheet is set to stop growing by the end of March. Anything that suggests a faster pace of tapering than this doubling (for example, a promise to wind down before March) and that hints that a hike at the March FOMC meeting is possible would be a hawkish surprise. The European Council meets on Thursday, and apart from having to deal with Covid-19 and the Russian threat on its eastern borders, the council is also set to decide whether investments in gas and nuclear energy should be labelled climate friendly. The design of the EU green investment classification system is closely watched by investors worldwide and could potentially attract billions of euros in private finance to help the green transition, especially given the need to reduce the usage of coal, the biggest polluter. Earnings Watch – the earnings calendar is getting very thin this week and no major earnings expected today. Wednesday: Inditex, Toro, Lennar, Heico, Trip.com, Nordson Thursday: FedEx, Adobe, Accenture Economic calendar highlights for today (times GMT) 0830 – Sweden Nov. CPI 1000 – Euro Zone Oct. Industrial Production 1100 – US Nov. NFIB Small Business Optimism 1300 – Hungary Central Bank Rate Decision 1330 – US Nov. PPI 1900 – New Zealand RBNZ Governor Orr before parliament committee 2130 – API Weekly Report on US Oil and Fuel Inventories 2330 – Australia Dec. Westpac Consumer Confidence 0200 – China Nov. Retail Sales 0200 – China Nov. Industrial Production During the day: IEA’s Monthly Oil Market Report   Follow SaxoStrats on the daily Saxo Markets Call on your favorite podcast app: Apple Spotify Soundcloud Sticher
Bitcoin, Ethereum, Metaverse Tokens Sink After Holiday Crypto Rally

Crypto market clings to last line of defence

Alex Kuptsikevich Alex Kuptsikevich 15.12.2021 08:47
Bitcoin continues to cling to its 200-day simple moving average, calming the entire crypto market. In the past 24 hours, the total value of all cryptocurrencies rose 3.3% to $2.19 trillion. The Fear and Greed Index rose 7 points to 28, which it was a week ago. Bitcoin has stabilised near the $48K level, keeping almost equal chances for gains and declines. A meaningful move away from the 200-day moving average line in one direction or the other promises to kick-start a strong momentum. Today the financial markets are wary of the words of the Fed Chairman and the comments of the FOMC. Deviations from expectations can affect the whole financial world, including bitcoin. And through it, the entire spectrum of cryptocurrencies. Ether has been showing close to zero momentum since the start of the day, remaining at $3850. On the chart, it is easy to see the activation of the bears near the 50-day moving average: a sharp breakdown in early December when this line became a resistance. The significant exception was the DOGE. The coin soared more than 40% after Musk tweeted that Tesla was considering selling merchandise for this coin. The explosive growth here is more of a secondary effect of its low liquidity and knee-jerk reaction to the message of Twitter’s chief influencer. Overall, there is also a downtrend here, which has taken 40% off the price from November 8th. However, taking a step back, it is still worth remaining cautious about expectations from the Fed and market dynamics after the announcement. Bitcoin’s technical support and Ether’s attempts to hold near $4000 are more likely to be buyers’ last hope of maintaining the illusion of a bull market. Overall, however, cryptocurrencies have been in a downtrend for more than a month now. These are not sharp dips and short squeezes but methodical selling by funds, as they are very similar to the dynamics of traditional markets. Other coins, where there are few market professionals, have a general downward trend.  
MSFT Stock News and Forecast: Why Microsoft is on target for $300

MSFT Stock News and Forecast: Why Microsoft is on target for $300

FXStreet News FXStreet News 15.12.2021 16:08
Microsoft stock falls over 3% on Tuesday ahead of Fed. Tech stocks suffer as rate hikes hit high growth names. MSFT is close to all-time highs, volume remains elevated. Microsoft (MSFT) is pausing for breath near all-time highs as the market awaits Fed taper talk Wednesday. While high growth stocks may wait in trepidation, more established names such as Microsoft and Apple (AAPL) have continued to attract fresh investors. High growth usually means low profits, but this is certainly not the case for Microsoft or Apple. Indeed, recent research from Goldman Sachs demonstrated the divergence between mega tech names this year versus unprofitable tech names. Unprofitable tech names are down circa 20% for the year, while mega tech is up nearly 30%. The logic is sound – higher rates disproportionally hit high growth rates. By comparison, established mega tech are cash cows that offer huge profits, huge leverage, huge purchasing power and operate in a quasi-monopolistic stance whereby inflationary pressures can be passed on to consumers. GOOGL, AAPL, MSFT outperformance versus Nasdaq since the start of the year Microsoft stock news It used to be the case that consumer staples were the de facto defensive stocks that investors retreated to in times of stress. After all, we all need food for survival. Utility stocks also were well-used defensive mechanisms for much the same logic, basic necessity. However, with the advent of mobile technology, essentials are now seen as communication and news stocks. Big tech fulfills all these roles. Our smartphone is a means of communication, a means of news service, television, shopping, etc. We now view many big tech services as essential and ones we cannot live without. Combine this with huge revenue, in many cases monopolistic qualities, and piles of cash, and you have the perfect defensive stocks for the 21st century. This is why Apple actually appreciated during last week's Omicron sell-off. What we are currently seeing is high growth meme names taking a disproportionate hit ahead of the Fed. Think Tesla down again, and AMC and GME collapsing. The Nasdaq index was the underperformer on Tuesday. Microsoft stock forecast $318 is our key short-term pivot. Already MSFT has put in a lower high, albeit just below all-time highs. A break of $318 sets a lower low and puts a short-term trend in motion. We specify short term here. This is what most of you likely are interested in. The longer-term trend remains bullish, fundamentals are strong, earnings power is consistent and defensive qualities mentioned above can shield it from inflationary pressures. However, there are some bearish points to note for short-term swing traders. We have a decling MACD and RSI. We also have bearish divergences from both indicators, significantly so in the case of the RSI. Based on this we feel $318 is likely to break, and below we see support at $300. We base this not only on the round number theory but on the volume profile. Volume means price acceptance and support. MSFT 1-day chart
Tesla Stock Price and Forecast: TSLA ready to rally for third day

Tesla Stock Price and Forecast: TSLA ready to rally for third day

FXStreet News FXStreet News 23.12.2021 16:03
TSLA shares shot up 7.5% on Wednesday after Elon Musk claimed he was done selling. NHTSA investigates 580,000 Teslas over video game safety issue. Tesla secures four-year supply of graphite for battery anodes from Australian company. Tesla (TSLA) did not underwhelm those expecting a banner session on Wednesday. TSLA shares careened up 7.5% after Elon Musk added even more color to Tuesday's statement about soon ending his season of selling. Specifically, he said there were a few tranches left, but that he was "almost done." The stock is trading up 1% in Thursday's premarket at $1,019. Tesla Stock News: Tesla secures graphite supply Tesla secured the majority of battery-grade graphite from a new Louisiania processing plant owned by Australia-based Syrah Resources, according to Bloomberg. The processor will have an initial supply capacity of 10,000 short tons a year, and Tesla will have first right to any increased supply capacity. Graphite is used for battery anodes, and China currently produces most of the world's battery-grade graphite. Syrah Resources will supply its graphite from Mozambique on the other hand. Syrah says it could raise its output from Mozambique to 40,000 tons by the middle of this decade. Early Wednesday morning the National Highway Traffic Safety Administration (NHTSA) announced a safety investigation into 580,000 Tesla vehicles sold since 2017 that come equipped with video games that can be played on the center console touchscreen. The NHTSA says that prior to December 2020, the games could only be played when the vehicle was in park. Starting a year ago, however, the agency claims the games were made available to the front passenger when the vehicle was in drive, which "may distract the driver and increase the risk of a crash," the NHTSA said. Musk's tweet on Wednesday that he was "almost done" with selling shares refers to his promise in early November that he would sell 10% of his stake in the EV maker. On a podcast on Tuesday, the Tesla CEO had said he had "sold enough" TSLA stock to meet his 10% goal. Wednesday's admission that he was "almost done" sounds closer to the truth, and some observers think he has sold about 15 million shares thus far with about 2 million to go. TSLA key statistics Market Cap $1.02 trillion Price/Earnings 330 Price/Sales 25 Price/Book 38 Enterprise Value $1.02 trillion Operating Margin 10% Profit Margin 7% 52-week high $1,243.49 52-week low $539.49 Short Interest 3% Average Wall Street Rating and Price Target Hold, $849.64   Tesla Stock Forecast: this is what a reversal looks like On Wednesday, Tesla's share price bounded past December's top trend line that has herded TSLA stock lower since December 1. Before the market opened on Wednesday, FXStreet wrote: "To confirm the reversal, TSLA price must close above the December 17 swing high at $960.61. Further confirmation that the three-week price decline is over would be a close above the December 16 high of $998.54." Indeed, the market has seen both levels broken in a single session. Now TSLA faces resistance at $1,020 from December 10. If bulls can break above this price, then the target will become December 8's $1,072 resistance point. Overpowering here will bring $1,165 into view, which provided resistance on November 30 and December 1. TSLA 1-hour chart
Rivian sprints past Volkswagen on market value – what’s going on?

Rivian sprints past Volkswagen on market value – what’s going on?

Peter Garnry Peter Garnry 18.11.2021 16:15
Summary:  Rivian has become a new phenomenon we have never seen before getting a $153bn market value with zero revenue booked. However, the company has pre-orders for around $9.4bn in revenue but even with optimistic assumptions the estimated cash flow from these orders can not even remotely justify the current valuation. Too high expectations are always a dangerous thing for investors and Rivian has taken speculation to a new level in EV stocks. In yesterday’s equity update, we wrote about the current bonanza in EV stocks with the 11 largest EV-makers in the world now worth more than the 11 largest ICE-makers. The recent IPO of Rivian has taken equity valuation and high expectations of the future to a whole new level. Rivian reached a market value of $153.3bn on yesterday’s close more than double the IPO valuation in just a few trading sessions. But here is the kicker, the EV-maker has never booked any revenue. This dwarf anything we have ever seen before and makes our bubble stocks look cheap. Source: Saxo Group Expectations are so high that Rivian can only disappoint Let’s look at some facts. Rivian is backed by Amazon which has made an order for 100,000 EDV (Rivian’s electric delivery van) with an attached exclusivity for the next 4-6 years from the first delivery with an option of first refusal. This is a key execution risk and could impact Rivian from diversifying their revenue. In addition, they have around 55,000 pre-order for their R1T and R1S trucks/SUV (for passengers). If we assume an average selling price of $50,000 for the vans, which is close to the normal price for a Ford van, and $80,000 on average for their passenger vehicles, then they have orders worth $9.4bn. If we assume that they can get to the same operating margin as Tesla has had in the last 12 months (9.6%) and we assume 25% cash tax rate, then this revenue constitute net operating income after taxes of $677mn. Assuming cost of capital of 10% (primarily equity financed with a high beta and early-start risk premium) and we play with the thought that this revenue/orders were a perpetuity and it could pass on inflation of 3% in the future, then this cash flow is worth $10bn today, a far cry from the current $153bn valuation. While these estimates are crude and not meant to provide the definitive answer to Rivian, it gives an idea of the expectations that the current share price reflects relative to what the company has in terms of orders. Expectations are so high that there is an elevated probability that EV-maker will disappoint investors. Ramping up production of EVs has proven to be difficult with only Tesla and Volkswagen looking to have found a way.
Tesla (TSLA) amazes (as always), this time - with a fantastic session

Tesla (TSLA) amazes (as always), this time - with a fantastic session

FXStreet News FXStreet News 04.01.2022 15:55
TSLA shares spiked 13.5% on January 3. Tesla announced 308,000 deliveries in the fourth quarter. Tesla stock almost closed a gap from early November, closing just shy of $1,200. Tesla's (TSLA) first trading session of the year was spectacular. A 13.5% gap up on the heels of a massive vehicle delivery beat seemed to even surpise the bulls. The close at $1,199.78 nearly filled the gap created by the gap down on November 8, and now TSLA shares are set to attempt the all-time high during the first week of 2022. Tesla Stock News: massive delivery beat Sunday's announcement that Tesla had delivered approximately 308,000 vehicles during the fourth quarter (a figure that may be revised higher once official Q4 earnings arrive during the final week of January) was well ahead of even Tesla's most bullish analyst and caused the massive upswing. The amateur analyst who uses the Twitter handle @TroyTeslike had forecast 289,000 deliveries, while Wall Street consensus had bet on 266,000. This positive news has all but left the market forgetting that Tesla is still dealing with a massive recall that came in right before the new year. Chinese regulators ordered Tesla to recall 19,697 Model S vehicles, 35,836 imported Model 3s and 144,208 Chinese-made Model 3 vehicles. This is part of a wide-scale recall with the US National Highway Traffic Safety Administration (NHTSA) that found the rearview camera can be damaged when the trunk is shut. Tesla is expected to recall a total of 475,000 Model 3 and Model S cars as a result. The recall amount is nearly equivalent to last year's delivery numbers. There is a bit of a kerfuffle continuing on Tuesday after it was reported on Monday that Tesla is opening a showroom in China's Xinjiang region, where the controversial detentions and reeducation of the Uighur minority carried out by the federal government has made it a focus of foreign human rights criticism. TSLA key statistics Market Cap $1.2 trillion Price/Earnings 330 Price/Sales 25 Price/Book 38 Enterprise Value $1.02 trillion Operating Margin 10% Profit Margin 7% 52-week high $1,243.49 52-week low $539.49 Short Interest 3% Average Wall Street Rating and Price Target Hold, $851.98   Tesla Stock Forecast: $1,243 is the focus TSLA shares are nearing the all-time high from November 4 of $1,243.49. With the premarket showing a small price rise to $1,205, the likelihood of achieving a new all-time high this week is high. The stock would only need to gain 3.7% to get there. To close the gap between November 5 and 8, TSLA stock needs to hit $1,208, which it likely will on Tuesday. The Relative Strength Index (RSI) is at 66, nowhere near overbought, especially for Tesla. Tesla price has a tendency to hinge on big psychological prices like $1,300. That is where Tesla is headed next. Mark my words. Support is at $1,117, $1,072 and $893. TSLA 1-day chart
Dogecoin (DOGE) allowed by Tesla (TSLA) in some way. BTC and ETH with decreases

Dogecoin (DOGE) allowed by Tesla (TSLA) in some way. BTC and ETH with decreases

Alex Kuptsikevich Alex Kuptsikevich 14.01.2022 10:05
Pressure on US tech stocks was a significant theme in US trading yesterday, dragging cryptocurrencies down. The Crypto market capitalisation adjusted 1.1% overnight to $2.05 trillion. Bitcoin is losing 2% overnight, down to $42.8K, and ether is losing about 1.5% to $3.3K. Other top coins are declining with much less amplitude, as investment fund darlings rather than crypto enthusiasts have been hit the hardest. The Doge, which has become accepted as a means of payment for some (inexpensive) Tesla goods, deserves a separate story. Some have noted that goods for Doge are selling out even faster than for dollars. On this news, the coin is adding 18% today at $0.20, near the highs for the month. This news is a good illustration of crypto's continued penetration of corporate culture. On the other hand, Tesla won't necessarily hold these coins forever. People will be more active in spending their investments in DOGE. The technical view of the ETHUSD is disappointing because the selling intensified earlier in the week while it tried to break the 200 SMA again. The dip and consolidation below suggest a break of the bullish trend formed in May 2020, when the pair consolidated above this line. In a worst-case scenario, it could be a road to $1300-1700, about half of the current levels. It is doubtful that in this bear market cycle, the price of ether will lose 95% of its peak, as it did in 2018, which could completely nullify the rise from 2020. Bitcoin's disposition is no less worrisome. A death cross forms in it as the 50-day dips below the 200-day. At the same time, the price is below these averages, which reinforces the bearish signal. Attempts earlier in the week to form a rebound are encountering more substantial selling, further indicating seller pressure. The bearish picture in Ether and Bitcoin makes the entire cryptocurrency sector appear cautious in the near term. Individual growth stories, like DOGE, run the risk of quickly losing strength today when the overall backdrop turns negative.
(TSLA) Tesla Stock with +1.75% There are many factors which can influence its price.

(TSLA) Tesla Stock with +1.75% There are many factors which can influence its price.

FXStreet News FXStreet News 17.01.2022 15:56
Tesla gains on Friday as Nasdaq finished in the green. TSLA stock closes at $1049.61 for a gain of 1.75%. Tesla shares are still in a downtrend but holding above the key pivot. Tesla (TSLA) returned to the green on Friday as the NASDAQ took the crown for best performing index, while the Dow suffered a bank burnout. Bank stocks reported on Friday in the form of Citigroup (C), JPMorgan (JPM) and Wells Fargo (WFC), and the results were decidedly mixed. Citigroup and JPMorgan fell heavily and dragged the Dow down with them. Yields though remained under control, allowing the Nasdaq to breathe lighter and make some headway after recent losses. This helped Tesla back into the green, but the stock remains choppy and sideways in motion. Tesla Stock News The Wall Street Journal reported over the weekend that a Tesla lawyer asked Cooley LLP, an international law firm, to fire one of its lawyers who had previously worked at the US SEC. The lawyer in question had supposedly interviewed Elon Musk in the SEC investigation in 2018 into Musk after he claimed on Twitter that he had gotten funding in place to take Tesla private. The SEC investigation led to Elon Musk and Tesla each paying $20 million fines. According to the WSJ article, a Tesla lawyer asked Cooley LLP to fire the attorney late last year, but Cooley did not follow through on the request. Tesla has used alternative law firms on several cases since December. Tesla and Cooley LLP have not yet responded to CNBC requests for comment. This may add to pressure on the stock despite Friday's rebound. Earlier in the week, investors and Cybertruck fans were left disappointed with a further delay to the truck's production timeline release, which has now been pushed to 2023. Tesla Stock Forecast Irrespective of the news, we have an indecisive chart here. TSLA stock's most recent high was a lower one than the previous and has put in a series of lower lows. This means it is currently in a short-term downtrend. $980 is the key pivot that will signify more losses. Breaking $980 makes the target $886. Holding above $980, and the target is $1,200. However, we have a declining Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD). The MACD has also crossed into negative territory. Tesla chart, daily
Tesla Stock Price and Forecast: Despite market sell-off, TSLA finished Thursday in the green

Tesla Stock Price and Forecast: Despite market sell-off, TSLA finished Thursday in the green

FXStreet News FXStreet News 21.01.2022 16:06
TSLA finished Thursday in the green, gaining 0.06% to $996.27. Equities had gyrated sharply but fell as the close approached. Tesla stock outperforms as Nasdaq and S&P 500 both fall sharply. Tesla (TSLA) managed to hold onto intraday gains but only just barely on Thursday. Stocks (https://www.fxstreet.com/markets/equities) had opened well and were up some 1% for the main indices at the halfway stage of Thursday, but jitters resurfaced as the finish line approached. Investors began dumping positions, and the main indices closed in the red. The S&P 500 shed 1.1%, the Dow closed 0.89% lower and the Nasdaq closed down the most at 1.34% in the red. Tesla however just held onto a green day, up 0.06%. Given that it is a volatile name and a high beta one, this was a strong outperformance. Tesla Stock News: bearish Bank of America forecast a worrying sign Tesla (TSLA) stock may have held its ground in anticipation of its Q4 earnings, which are due out next week. Bank of America and Piper Sandler fought it out with conflicting analyst reports. Bank of America took a dim view of Tesla's market share forecasts, saying it would drop from 69% to 19% of the EV market due to legacy automakers ramping up EV production. However, Piper Sandler noted that it sees Tesla beating delivery estimates for the year due to factories in Texas and Berlin ramping up production. For now, it appears investors are putting more focus on those delivery numbers and anticipating a strong earnings report. The Bank of America report is more alarming, but it does have a longer term outlook with the market share fall predicted for 2024. Tesla Stock Forecast: $886 is a futher downside target Yesterday's move has kept Tesla above the key short-term pivot at $980, but note that yesterday's high price was stuck at the 9-day moving average and Tesla failed to break through. This gives us more belief in an imminent break of $980. If this level does go, then the move to $886 will likely be quick due to a lack of volume. Tesla (TSLA) chart, daily
Crypto and FOMC As Always Interact, Waiting for FED Decision and Tesla (TSLA) Reports

Crypto and FOMC As Always Interact, Waiting for FED Decision and Tesla (TSLA) Reports

Walid Koudmani Walid Koudmani 26.01.2022 12:20
Today’s highly anticipated FED decision could have wide ranging implications across markets as it could alter the current state of economic policy and ultimately favour some markets over others. While there are several scenarios of what’s expected today from the US central bank, the most likely one seems to be a rate increase in March while maintaining QE for the time being , which many investors could see as a slight step back compared to the tone used by the FED recently. On the other hand, if the FOMC decides to surprise investors with a more hawkish than expected approach, it could lead to significant reactions across stock markets and cryptocurrencies even after the recent corrections we have already seen so far. The FED must be very cautious today as it appears to be stuck in a challenging situation, unable to ignore record inflation levels while also having a market that relies heavily on its fiscal policy and any misstep could have greater than expected consequences. Cryptocurrencies attempt to recover ahead of FOMC decision Cryptocurrencies and tech stocks have seen the majority of the volatility and pullbacks from recent uncertainty noticed across a wide range of markets to different extents. However, due to their exceedingly volatile nature, cryptocurrency prices moved significantly with the total market cap falling around $1 Trillion as the majority of top 100 tokens dropped around 20% reaching the lowest level in several months and shaking investor confidence in the sector. On the other hand, we are seeing an attempt to recover today with most tokens trading slightly higher ahead of the FOMC decision as some investors expect the US central bank to back off after seeing the massive reaction it’s recent announcements have had. While it remains to be seen whether the FED will go through with its plan, it is clear that a significant increase in volatility has the potential to scare many investors who may not be interested in projects for the long term and are mainly attempting to speculate on their prices for short term gains. Investors await Tesla earnings report While many investors will be focusing on the FED’s key decision today, earning season has also been a main topic of discussion with several major companies already publishing their reports. We have seen a variety of contrasting results with some exceeding expectations while others disappointed and ultimately reflected that in a significant share price drop. Tesla will be publishing it’s results today and investors will be looking closely to ascertain if the company is living up to the forecasts or if it also appears to be struggling with rising inflation and supply chain issues. A better than expected result could renew investor confidence in the company that has been able to impress many since being listed on the S&P 500 not long ago, while a disappointment could impact future prospects in addition to share price in the short term.  
NASDAQ, Non-Farm Payrolls, GBPAUD, Gold and More in The Next Episode of "The Trade Off"

Stock Market in 2022: Momentum on the Stocks in the Market Are In a Solid Footing

Finance Press Release Finance Press Release 28.01.2022 10:51
The year 2022 is seemingly a mixed bag, even as markets start reopening. The year looks promising, though, with issues like inflation and COVID to contemplate. Historic rallies in 2021 after lockdowns are looking to inspire trading in various industries, with some assets to look out for by investors. Growth will surely return at some point, but so will disappointing instances where tumbles will dominate trading desks. The S & P's historic gains of 30 percent dominated the press at the close of 2021, making investors using Naga and other optimistic platforms. The ended year had one of the longest bull markets. However, the Fed rate tightening and the direction the pandemic will take are some things to expect, notwithstanding that the stock market might grow by a whopping 10 percent in 2022. Trading Movements In Week One 2022 European markets have opened with a lot of optimism in 2022, the pan-European STOXX 600 closed at 489.99 points; this is 0.5 percent higher than the opening figure. The European benchmark was some percentage lower than the overall S&P 2021 performance, though with a surge of 22.4 percent. Record gains in the stock markets have relied on the positions taken by the governments during the pandemic. In the USA and Europe, increasing vaccination rates and economic stimulus measures have improved investor confidence. However, there are indications for more volatility in 2022, a situation investors must watch keenly. There has been little activity in London markets in the first week of 2022, while in Italy, France, and Spain gains of between 0.5-1.4 percent made notable highlights. European markets had diverse industries drive up the closing gains witnessed; the airline sector, in particular, has had a significant influence. Germany’s Lufthansa (LHAG.DE) had an impressive 8.8 percent jump while Air France KLM (AIRF.PA), a 4.9 percent gain. Factory activity is another factor to thank for the first week's gains all over Europe. Noteworthy, the Omicron variant influenced trading in the entirety of December, but the reports that it is milder than Delta has energized market activities coming into January. S&P and DOW Jones 2022 First Week Highs Across the Atlantic, the Dow Jones Industrial Average (DJI) and S&P 500 (SPX) closed at a record high, highlighting a similar aggressiveness as the European markets. While the jump was industrial-wide, Tech stocks continued to dominate, as Apple finally touched the $3 trillion valuation, though for a short time. Tesla Inc. (TSLA.O) posted a 13.5 percent jump thanks to increased production in China and an unprecedented goal to surpass its target. The US market, like the European market, is also in a fix; the Omicron variant of COVID-19 continues to cause concern with the wait-and-see approach, the only notable strategy. Currently, every country is reporting a jump in the number of Covid cases, with the UK going above 100K cases for the first time and the US recording some new records as well. School delays and increased isolation by key workers will surely debilitate the markets, with the global chip shortage another point to contemplate. However, markets can still ride on the increased development of therapies to help fight Covid. The U.S. Food and Drug Administration (CDC) has been quick, as now children can have their third doses as well. Industries to Look Out For In 2022 European automakers have seen early peaks, while the airline sector has also picked up fast. In the US, tech shares continue to dominate, and 2022 might witness new records never seen before. However, the energy sectors have also dominated the news in 2021, and in 2022; the confidence in them will continue to rise because of an anticipation of stabilization in energy prices. The same goes for crude oil prices. Regardless, shareholders will continue watching the decisions by the Federal Reserve, a review in the current interest rates will surely tame inflation. Conclusion 2022 will see its highs and lows in investments. Some assets will make the news and investors will be keen to use any information to make key decisions. Tech will continue to shine, but it is important to anticipate the direction of the pandemic, as it will be an important factor in investor decisions.
Tesla Stock Price and Forecast: Why did TSLA fall despite beating earnings estimates?

Tesla Stock Price and Forecast: Why did TSLA fall despite beating earnings estimates?

FXStreet News FXStreet News 27.01.2022 15:59
Tesla stock swung around violently post the earnings release. TSLA shares quickly dropped 6% despite beating earnings estimates. Tesla then recovered to trade down 2% as buyers stepped in. Tesla (TSLA) swung around pretty wildly in the after-hours market on Wednesday following its earnings release. The stock dropped 6% fairly rapidly despite beating on the top and bottom lines. Buyers then went bargain hunting as the market struggled to grasp what metric to focus on. By the time things settled down, we were nearly back to where things started. At the time of writing, Tesla is back to $930 in the premarket on Thursday, so only $7 or less than 1% lower from where Tesla stock was trading at the close of the regular session and before the earnings drop. Tesla Stock News Tesla beat on earnings per share (EPS), coming in at $2.54 versus the $2.26 average estimate. Revenue also beat forecasts, coming in at $17.72 billion versus the $16.35 billion estimate. This was a pretty strong performance beat on both top and bottom lines. Margins also held up well, coming in at 30.8% versus estimates for 30%. So far so good. However, Tesla then mentioned that its factories were not at full capacity and it saw this continuing into 2022. Supply chain issues were to blame, and investors took a dim view of this and sold the stock sharply lower. However, buyers then stepped in as arguments over demand versus supply issues surfaced. The demand profile remains strong and Tesla stuck to its strong outlook for demand going forward. If it can address supply issues and with new factories in Texas and Berlin coming on line, it may be in a position to drive more supply to meet demand. It is certainly better to have a problem meeting demand than it is to have a lack of demand. This is a case of "if you build it, they will come" for Tesla going forward. Tesla Stock Forecast TSLA bottomed out at $879 after the release, but in reality it spent very little time down there. This is interesting to us on a technical view as it prints a higher low than Monday's sell-off and puts in place the potential for a bottoming formation. From the 4-hour chart below we can see this price action in play. The lows from Monday at $855 are our short-term pivot. Above there things have a chance to turn bullish in a more medium-term view. Below and it is on to $813 to test the 200-day moving average. Tesla chart, 4 hourly
Swissquote MarketTalk: A Look At XAUUSD, Swiss Secrets, Tesla And More

A Lot To Watch In The US, What About Big Tech Companies?

Swissquote Bank Swissquote Bank 31.01.2022 11:11
US stocks recorded a last-minute rally on Friday, but gains remain on jeopardy as the hawkish Fed expectations and the Russia-Ukraine tensions are weighing on the risk appetite. The geopolitical tensions, in fact, push energy prices higher, further boosting the inflation fears and the Fed hawks. The consensus now is that the Fed would raise the interest rates five times this year. In this environment, US dollar is certainly a good place to park, while gold is doing surprisingly poorly despite having most factors that would normally support a better pricing on its side. In the stock markets, value stock investors are finally being praised for their patience. At today’s episode, I have an interesting comparison of Warren Buffet and Cathi Wood’s performances over the past two years! Watch the full episode to find out more! 0:00 Intro 0:24 Market update 1:34 Energy prices jump on Russia-Ukraine tensions 3:10 USD consolidates gains, XAU performs surprisingly bad 3:55 Warren Buffett vs Cathie Wood 5:43 Big Tech gains at jeopardy as Fed hawks gain field 8:45 This week's economic calendar: ECB, BoE, RBA & OPEC 9:25 This week's corporate calendar: Google, Facebook & Amazon Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020.
Tesla (TSLA) Price Also Has Its Ups and Downs. It's Below $920 Currently

Tesla (TSLA) Price Also Has Its Ups and Downs. It's Below $920 Currently

FXStreet News FXStreet News 31.01.2022 15:49
Tesla stock tumbles after beating earnings estimates TSLA shares hit by concerns over supply chain issues. Apple and big tech could turn the market next week. Tesla (TSLA) staged a modest recovery on Friday, but the real damage was done on Thursday when the stock shed nearly 12%. Friday's move was not even that impressive given Tesla's high beta, a fact that would usually see it bounce significantly more than the major indices. As we know well by now high, growth is not the sector of choice this year, and Tesla does straddle this space. Investors are moving back to more traditional sectors and metrics for their portfolios, and the era of high flying growth is coming to an end, for now at least. We view this as a positive event, stretching too far would have resulted in an ugly snapback or bubble popping most likely. This stabilisation should continue for the year with one or two speculative dead cat bounces along the way. We may just get one of those next week as the remainder of big tech gets a chance to continue on from where Apple led. Amazon (AMZN), Google (GOOGL) and Facebook (FB) are all reporting earnings this week. Positive earnings should steady sentiment, and this would then also likely spread to some high growth names. However, in the longer term, we expect balance sheets rather than growth to outperform this year. Tesla Stock News Tesla is not just pure growth, although it is managing to do that rather impressively if the latest results are anything to go by. It will stay with the pace, while other start-up EV manufacturers are more likely to fade away. Tesla created the EV space and remains the brand leader. This will likely not change since it has positioned itself as a premium brand. It will likely face more competition, but we do not see it losing quite as much market share as that forecast by Bank of America. Forecasting a drop from 69% to 19% market share in the space of two years does seem a bit headline-grabbing. The problem for Tesla is its valuation got too ahead of itself, so it is likely to underperform in this new environment despite continued strong earnings and revenue growth. Tesla Stock Forecast The bearish trend is now well-established. Thursday's losses only followed on from what we identified back in early January. The spike higher failed, and then it created a lower low, which confirmed the mid-December low. Even Friday's price action set a lower low than Thursday before the bounce set in. Resistance at $987 is last week's high and is first up. A close above that is significant and a new bar above that will signify a small short-term uptrend. Otherwise, the medium-term downtrend remains in control with support at the 200-day moving average, which sits at $814 currently. Tesla (TSLA) chart, daily
Market Shrugs Off Chinese Signals and Keeps the Yuan Bid

Market Shrugs Off Chinese Signals and Keeps the Yuan Bid

Marc Chandler Marc Chandler 22.11.2021 13:35
November 22, 2021  $CHF, $USD, BOE, China, Currency Movement, FOMC, Japan, Philippines, Russia Overview:  The US dollar has come back bid from the weekend against most currencies following the talk by a couple of Fed governors about the possibility of accelerating the tapering at next month's FOMC meeting.  The weekend also saw protests against the social restrictions being imposed by several European countries in the face of a surge in Covid cases.  The Swedish krona, yen, and sterling are the weakest, while the dollar-bloc currencies are resisting the greenback's tug. Most of the freely accessible and liquid currencies among emerging market currencies, including Russia, Hungary, South Africa, and Mexico, are heavy. At the same time, the Turkish lira recoups a little of the ground lost last week, and the Chinese yuan shrugged off apparently warnings from the PBOC to post its first gain in three sessions.  Equity markets in the Asia Pacific area mostly fell, though China and South Korea were notable exceptions.  Europe's Stoxx 600 snapped a six-week advance last week but has begun the news week with a small gain through the European morning.  US futures are trading higher.  The bond market is heavy, with the 10-year US Treasury up about three basis points to around 1.58%.  European benchmark yields are 2-3 bp higher.  Gold finished last week on a softer note and edged lower today to trade below $1840 for the first time since November 10.  Resistance is around $1850.  News that Japan may join the US to release oil from reserves saw January WTI slip below $75 but recover back above $76.  It met the (38.2%) retracement of the rally from the late August low near $60.75.  European natural gas (Netherlands) is lower for the fourth consecutive session, during which time it has fallen around 11%.   Iron ore extended the 5.6% gains before the weekend with another 4% gain today.  On the other hand, copper rose 3.3% in the past two sessions and has come back offered today.  Lastly, the CRB Index eased less than 1% last week and is off two of the past three weeks.  Its seven-month rally is at risk.   Asia Pacific Despite China's economic success, it remains clumsy and heavy-handed.   As the US and some other countries were considering a symbolic diplomatic boycott of the winter Olympics in Beijing, the tennis star Peng Shuai is being censored or worse for allegations against a former Politburo member.  Meanwhile, at the end of last week, three Chinese coast guard vessels launched water cannons against two Filipino boats sent to resupply a garrison on the Second Thomas Shoal (Ayungin Shoal), which is within the Philippines' Kalayanan Island Group.  The aggressive harassment brought a rebuke by the US, which reminded Beijing of its mutual defense agreement with Manila.   The Philippines will attempt to bring provision again this week.  Separately, note that after being notified by the US of the military nature of the Chinese construction project in the UAE, the project has been halted.   With the yuan at six-year highs against a trade-weighted basket, Chinese officials have begun expressing more concern about the one-way market.  The FX Committee, composed of industry participants, wants members to do a better job monitoring prop trading, and it follows the PBOC works of caution about risk management at the end of last week.  In its quarterly monetary review, the PBOC made a few tweaks that suggest it could ease policy.   Japan's Prime Minister Kishida acknowledged that releasing oil from its strategic reserve was under discussion.  China indicated it would tap its reserves last week for the second time since September, while it is still under review in the US.  Currently, Japan keeps reserves that are intended to last 90 days, while the private sector must hold reserves to last 70 days, according to reports.  Japan is considering selling oil and using the funds to subsidize the rising gasoline prices.  It may also reduce the duration of the reserves.   The dollar is straddling the JPY114.00 level as its hugs the pre-weekend range (~JPY113.60-JPY114.55).  The JPY114.30 area offers initial resistance, while the focus in early North America may be on the downside.  Still, it appears to be going nowhere quickly.   The Australian dollar finished last week at its lowest level since early October.  That low, just below $0.7230, held, and momentum traders covered shorts, helping lift the Aussie back to session highs near $0.7260.  A move above here allows gains into the $0.7270-$0.7290 area.  The PBOC set the dollar's reference rate at CNY6.3952 today.  The market (Bloomberg survey median) had projected a CNY6.3931 fix.  Although the dollar is softer today, it held above last week's lows as consolidation is evident.  It remains within the range set last Tuesday (~CNY6.3670-CNY6.3965).   Europe With the Swiss franc appreciating to six-year highs against the euro, it would not be surprising to see the SNB intervene.  The first place to look for it is in the weekly domestic sight deposits.  They rose by CHF2.58 bln, the second-most in the past three months.  Recall the mechanics.  The SNB buys euros but just sitting on them distorts the allocation strategy.  So it needs to either sell some euros for dollars or Swiss francs for dollars.  If it does the latter, its overall level of reserve growth accelerates.  Many suspect it will do the former, i.e., sell some euros for dollars.   The US continues to warn that Russia's troop and equipment movement is consistent with a rapid large-scale push into Ukraine from multiple spots simultaneously.  The suggestion, according to reports, is that the operation could take place early next year.  Both Ukraine and Georgia are seeking more US assistance.  Recall Russia invaded Crimea in February 2014.   Bank of England Governor Bailey has toned down his rhetoric, though he blames the market for misconstruing his remarks last month.  He warns now that next month's decision is finely balanced and that the price pressures are emanating primarily from supply-side disruptions for which monetary policy is less directly effective.   The implied yield of the December 2021 short-sterling interest rate futures contract is slipping for the fourth consecutive session.  Today's yield of about 21 bp is the lowest since early October.  The yield peaked in mid-October near 62 bp.  Lastly, while progress on the UK-EU talks has been reported, the two sides are still far apart.  Talks between Frost and Sefcovic will resume at the end of this week.   The prospect that a new German government could be announced this week has not helped the euro very much.  The single currency, which was sold through $1.14 and $1.13 last week, is struggling to find a base.  It has held above the pre-weekend low near $1.12560 but only barely (~$1.1260), and the attempt to resurface above $1.1300 was rebuffed. A move above $1.1320 may suggest some near-term consolidation, perhaps ahead of Wednesday's US PCE deflator report.  That said, tomorrow's flash PMI composite reading for the eurozone is expected to have weakened for the fourth consecutive month.  Sterling could not rise 15 ticks from its pre-weekend close (~$1.3450).  The downside was also limited (~$1.3420).  It caught a bid in the European morning that could extend into the US morning.  Still, the $1.3460-$1.3480 band may be a sufficient cap.  The market does not appear inclined to see trigger the $1.3395 option that expires today for about GBP425 mln.   America President Biden's announcement on the Fed's leadership could come as early as tomorrow, as he is set to deliver a speech on the economy tomorrow.  But it probably would be a separate announcement.  Given the expiration of the terms of the two vice-chairs, changes among a few of the regional presidents, and the challenging situation, President Biden is likely to follow Treasury Secretary Yellen's recommendation to re-appoint Powell.  Moreover, a tradition goes back to Volcker of one party making the initial nomination and the other party approving of another term.  This helped "depoliticize" monetary policy.  Trump broke with that tradition, and as Biden has done in a number of other areas, is restoring some traditions.  Lastly, we suspect that if Bernanke or Yellen, or Brainard were at the helm of the Fed, there would not be substantive monetary policy differences.   Vice-Chair Clarida and Governor Waller joined regional Fed President Bullard to suggest that Fed may consider accelerating the pace of tapering at next month's FOMC meeting.  We suspect others will be sympathetic after this week's October PCE and deflator news.  The economy is rebounding in Q4 from the disappointing 2% annualized pace in Q3 (which is likely to be revised higher on Wednesday), and a critical part is consumption.  Personal consumption expenditures are expected to rise by 1% after a 0.6% increase in September.  The headline PCE deflator, which the Fed targets 2% on average, which Governor Brainard reportedly helped devise, is expected to jump above 5% from 4.4% in September.  The core rate is expected to exceed 4%.  No Fed officials are slated to speak this week, but the minutes from the November 3 FOMC meeting will be released on November 24.   El Salvador caught the crypto world's attention again.  It is the first country to make Bitcoin legal tender.  It announced plans to issue a $1 bln bond, and half the proceeds will be used to buy Bitcoin (~2000 coins).  The other half will be used to fund infrastructure projects to build the infrastructure of more Bitcoins.  It will offer a 6.5% coupon, which is lower than current dollar issues.  It looks like one pays a lot for BTC exposures.  El Salvador is rated BB+ of the equivalent by the top three rating agencies.  This makes El Salvador bonds risky, to begin with, and adding Bitcoin on top of that would seem to preclude most retail and institutional investors.  It seems like a desperate act that only an impoverished country can try.  The idea that other countries will quickly follow seems to be a stretch.  There is a good reason why Tesla had few corporate followers to buy Bitcoins with reserve funds.  The same principle would seem to apply to countries.   The economic calendar for North America begins off slowly this week.  Today's main feature is the US existing home sales report.  A pullback after September's heady 7% gain is expected, the strongest in a year.  After a weak start to the year, existing home sales have recovered.  They averaged 5.66 mln (seasonally adjusted annual rate) last year and have averaged more than 6.0 mln for the past three months.  The Canadian dollar has weakened for the past four weeks.  It briefly poked above CAD1.2660 ahead of the weekend to reach its best level since early October.  The greenback is in about a 15-tick range on either side of CAD1.2645 today.  Support is seen in the CAD1.2600-CAD1.2620 area, but it may take a break of CAD1.2585 to boost confidence that a high is in place.  The US dollar rose 1.5% against the Mexican peso last week.  It was the third weekly gain in the past four weeks.  The greenback is trading above last week's high (~MXN20.89) and looks set to test the high set earlier this month near MXN20.98.  Lastly, the Chilean presidential election will go to a run-off next month, as widely expected between the far-right and far-left candidates.   The dollar snapped a five-week pullback against the Chilean peso last week, rising 3.6%, the most in three months.  Year-to-date, the peso is off nearly 14.25%.   Disclaimer
SEC Rejects Valkyrie, Kryptoin Spot Bitcoin ETF Applications

Bitcoin Hovered Around Ca. $44k Yesterday, Ether (ETH) Gains 5%, Solana Increases by 4%, Ripple by 18.5%

Alex Kuptsikevich Alex Kuptsikevich 08.02.2022 08:31
On Monday, Bitcoin rose 5.5%, ending the day around $44,100. Ethereum added 5%, and other leading altcoins from the top ten also showed growing dynamics: from 4% (Solana) to 18.5% (XRP). The total capitalization of the crypto market increased by 5.5% over the day to $2.10 trillion. The Bitcoin dominance index has not changed, remaining at 39.2%. The Bitcoin chart continues to paint a bullish picture. With the price at $45K on Tuesday morning, BTCUSD is trading above the 50-day moving average just above the mid-January pivot area and above the down channel resistance level. At the same time, the RSI on the daily charts has not yet entered the overbought area, leaving room for further growth.  The same can be said about the entire cryptocurrency market, where the fear and greed index has reached a neutral point of 48 and is still far from the greed area. The next target for the bulls looks to be $48K, the December support area in December. Further targets are $49-50K, where the 200-day moving average and significant round level are concentrated. The XRP token soared amid reports of a significant approach to the resolution of Ripple's legal dispute with the US Securities and Exchange Commission (SEC).Cryptocurrencies briefly stopped responding to movements in US stock indices, which started the week with a decline. The purchases probably included retail investors, who were driven by the desire not to miss the beginning of the market growth (FOMO). However, their buying potential is unlikely to be enough if stock indicators intensify their decline and large institutional investors come into play, wishing to resume profit-taking. KPMG, one of the world's largest auditors, has added Bitcoin and Ethereum to its Canadian division's corporate reserves. This is the firm's first direct investment in cryptocurrencies. Meanwhile, at the end of 2021, Tesla received a loss of $ 101 million from a decrease in the cost of previously purchased bitcoins, which it spent $ 1.5 billion on. Previously, Elon Musk called the decision to acquire BTC as a reserve asset quite risky. 
Tesla Stock Price and Forecast: Should I buy TSLA, RIVN or LCID?

Tesla Stock Price and Forecast: Should I buy TSLA, RIVN or LCID?

FXStreet News FXStreet News 14.02.2022 15:59
TSLA drops nearly 5% on Friday as macro factors in charge. All EV stocks LCID, Chinese names suffer the same fate. Tesla once again is targetting its 200-day moving average. Tesla (TSLA) followed many EV names (all, if we are correct) lower on Friday as macro factors took charge over equity markets. The dominant theme so far in 2022 has been one of rising rates and inflationary pressures. This has led to high growth and tech names underperforming, while energy and financial stocks have been the place to be. That is likely to remain the theme for at least the next quarter if not also Q2. Russia and Ukraine tensions have pushed the oil price above $90, and financial stocks benefit from higher interest rates. Growth stocks, however, do not benefit from higher interest rates as investors look for businesses with cash. With higher interest rates, future cash flows become less valuable. So of the three names mentioned, Tesla, Rivian (RIVN) or Lucid (LCID), we would not want to currently be long any of them. We expect TSLA to perform best of the three due to its market-leading position and revenue, but this sector is out of favour and likely to remain so. Tesla Stock News The latest data from the China Passenger Car Association (CPCA) confirms what we saw from Chinese EV companies earlier. Deliveries for January were down versus December. This is due to the lunar new year in China. Tesla sold 59,845 vehicles in January, down from 70,847 China-made vehicles in December. The Chinese electric vehicle market remains the largest EV market in the world, helped by government incentives and population demand. Tesla Stock Forecast Tesla remains in the strong downtrend identified earlier this year. $945 was tested multiple times as resistance and failed. This has resulted in the recent pullback. Now $824 remains as the 200-day moving average. Below we have trendline support at $752. The 200-day is the key level. Tesla has not closed below its 200-day moving average since June 2021. It has broken the 200-day on an intraday basis several times since but always failed to close below. Notice how volume has steadily been declining in Tesla this month, despite some hugely volatile days. This is indicative of a lack of conviction in the stock. Tesla (TSLA) chart, daily
Tesla Stock News and Forecast: TSLA, RIVN or LCID stock, which is the best buy?

Tesla Stock News and Forecast: TSLA, RIVN or LCID stock, which is the best buy?

FXStreet News FXStreet News 16.02.2022 16:18
Tesla bounces strongly on Tuesday as risk assets surge. TSLA stock gains just over 5% on Tuesday. Geopolitical tensions falling help risk appetites return. Tesla (TSLA) shares bounced strongly on Tuesday, eventually closing up over 5% in a strong day for equities. The stock market was buoyed by news of some Russian deployments returning to their bases. Russia then appeared to confirm this as hopes grew for a diplomatic solution. This saw an obvious bounce in equities (https://www.fxstreet.com/markets/equities) with the strongest names being those that were previously the weakest. Understandable, but is this gain sustainable? NATO this morning has said it sees no sign of Russian troops pulling back from the Ukraine border. NATO has said it sees Russian troop numbers still growing along the Russian-Ukraine border. This news (https://www.fxstreet.com/news) still has legs. Volatility has been high as a result and will likely continue that way. Tesla Stock News The latest quarterly SEC filings have provided much information to pore over. In particular, Tesla, they do note some hedge fund selling. This is not too surprising given the record highs TSLA stock pushed on to before Elon Musk sold a stake. Benzinga reports that the latest filing shows Ray D'Alio's Bridgewater cutting its stake in Tesla. Cathie Wood of ARK Invest was regularly top-slicing her firm's stake in Tesla recently. CNBC also reported yesterday that hedge fund Greenlight Capital had made a bearish bet on Tesla shares. Greenlight, according to the report, has been a long time Tesla bear. Apart from those snippets though, macroeconomic factors are the main driver of the Tesla stock price currently. Electric vehicle stocks have not been a strong sector so far in 2022 as growth, in general, is out of favor with investors. This has led to steep falls in other names such as Rivian (RIVN) and Lucid (LCID). Both are at a much earlier stage of development than Tesla (TSLA) and on that basis, we would favor Tesla (TSLA) over them. But we must stress we would ideally avoid the sector entirely until perhaps the second quarter. Once markets have adjusted to the prospect of higher rates, some high-growth stocks may benefit. historical in a Fed (https://www.fxstreet.com/macroeconomics/central-banks/fed) hiking cycle the main indices do advance but growth sectors struggle. Rivian so far is down 36% year to date, Lucid is down 24% while Tesla is the outperformer, down 12% for 2022. Tesla Stock Forecast We remain in the chop zone between the two key levels of $945 and $886. Breaking $945 should lead to a move toward $1,063. That would still be consistent with the longer-term bearish trend. Nothing goes down or up in a straight line. TSLA is unlikely to be able to fight the current overpowering macroeconomic backdrop of rising rates (https://www.fxstreet.com/rates-charts/rates) hitting high growth stocks. But breaking $945 is still significant in the short term and should see some fresh momentum. While $886 is significant, the 200-day moving average at $826 should have our real attention on the downside. Tesla has not closed below this level in over 6 months, so that would be significant and again lead to a fresh influx of momentum. Just this time though, it would be selling momentum. Tesla (TSLA) chart, daily Short-term swing traders should note the volume momentum behind moves. Once volume dries up, Tesla tends to fall off intraday. From the 15-minute chart below, we have an opening gap from Tuesday down to $880. This is short-term support, but a break will see the bottom of Monday's range at $840 tested. Tesla (TSLA) 15-minute chart
Swissquote MarketTalk: A Look At XAUUSD, Swiss Secrets, Tesla And More

A Week Of Many Events Is Ending But An Equally Interesting Is Incoming

Swissquote Bank Swissquote Bank 18.02.2022 09:56
Tensions between Ukraine and Russia escalated yesterday, sending gold to $1900 per ounce, but investors are calmer this morning, as planned talks between the US and Russia gives a certain relief before the weekly closing bell. But the risk taking will likely remain limited, offering a limited recovery potential to equities & cryptocurrencies. Oil on the other hand tanked despite the rising Ukraine tensions, rupturing a well-justified positive trend between geopolitical risks and energy prices. In the FX, the safe haven yen gained, the EURUSD remained steady as the macro pricing was put on hold. In individual stocks, Tesla tanked 5% after it sank to the bottom of the latest Consumer Report’s ranking. Ouch. Watch the full episode to find out more! 0:00 Intro 0:31 Ukraine update 2:02 Gold up 2:48 Why is oil down?! 4:57 Market update 6:08 FX update 7:15 Bitcoin tests $40K support 7:41 US yields down 8:20 Tesla tanks on big ranking drop on latest Consumer Report Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020.
Tesla Stock Price and Forecast: TSLA continues Thursday rebound, adds 2% in premarket

Tesla Stock Price and Forecast: TSLA continues Thursday rebound, adds 2% in premarket

FXStreet News FXStreet News 25.02.2022 16:18
Tesla bounces strongly on Thursday as markets decide to ignore Ukraine. TSLA stock gains 4.8% on general market bounce back. Shares are up more than 2% in Friday's premarket. Tesla (TSLA) shares bounced strongly on Thursday after dropping off a cliff due to Russia's invasion of Ukraine, Tesla is now charging higher in Friday's premarket. TSLA stock bottomed out at $700 after opening just above it on Thursday, before spending the entire session climbing back to $800. The stock closed at $800.77, a surprising 4.8% above Wednesday. It is now up 2% in the premarket near $820. Tesla Stock News: Odd trades The latest news is a family affair. Trades made by CEO Elon Musk and his brother Kimble, who sits on Tesla's board, are being scrutinized by the Securites & Exchange Commission (SEC). The Wall Street Journal reports that Kimble sold $108 million worth of shares just one day before his brother Elon posted his infamous Twitter poll asking if he should sell 10% of his Tesla stake. Once the poll was answered strongly in the affirmative, Elon began selling. This caused an approximate 25% sell-off in the share price over the following month. Daiwa Securities Group, Japan's second-biggest investment bank, plastered an outperform rating on the stock due to what it said makes the company more attractive due to the Ukraine-Russia affair. The Japanese bank gave TSLA a $900 price target, writing that "higher oil prices and potential scenario of fuel shortages, especially in Europe, could accelerate the shift to EVs. While the start of production at the Berlin plant could be delayed, recent media reports of Tesla increasing capacity at its Shanghai facility gives it more flexibility to meet European demand." The bank also pointed to the company raising output at its Shanghai plant to 1 million units per year and increasing production to 500,000 units at its Austin plant. Currently, the Shanghai factory can produce about 450,000 units a year. One reason why increasing Shanghai output is key is that gross profit margins run at about 40% there, whereas the automaker's original factory in Fremont, California, has gross profit margins closer to 20%. Last but not least, Tesla has lost its Director of Engineering, Brian Dow, to Generac Holdings (GNRC), a maker of energy storage systems and batteries. Tesla Stock Forecast: Ukraine invasion provides $700 as support One benefit of the rollercoaster ride that hit markets on Thursday is that shareholders now know where long-term support sits. Ahem, it is $700. There must have been enough automatic buying there to spur the price higher since shares were pushed up steadily to $765 by midday. The $700 mark is, however, right in line with a descending bottom side trend line in place since November 10. The region around $945 is still the target to break back into bullish territory. This $945 mark has served as both support and resistance over the past four months going back to October. Before that, however, TSLA shares must close back above the 200-day moving average, which is now at $832.61. It broke through this moving average on Tuesday and may signal there is more downside ahead. TSLA 1-day chart
Is It Too Late To Begin Adapting To Higher Volatility In The Market?

Is It Too Late To Begin Adapting To Higher Volatility In The Market?

Chris Vermeulen Chris Vermeulen 07.03.2022 22:18
Now is the time for traders to adapt to higher volatility and rapidly changing market conditions. One of the best ways to do this is to monitor different asset classes and track which investments are gaining and losing money flow. Knowing what the Best Asset Now is (BAN) is critical for consistent growth no matter the market condition.With that said, buyers (countries, investors, and traders) are panicking as the commodity Wheat, for example, gained more than 40% last week.‘Panic Commodity Buying’ in Wheat – Weekly ChartAccording to the US Dept. of Agriculture, China will hold 69% of the world’s corn reserves, 60% of rice and 51% of wheat by mid-2022.Commodity markets surged to their largest gains in years as Ukrainian ports were closed and sanctions against Russia sent buyers scrambling for replacement supplies. Global commodities, commodity funds, and commodity ETFs are attracting huge capital inflows as investors seek to cash in on the rally in oil, metals, and grains.How does the Russia – Ukraine war affect global food supplies?The conflict between major commodity producers Russia and Ukraine is causing countries that rely heavily on commodity imports to feed their citizens to enter into panic buying. The breadbaskets of Ukraine and Russia account for more than 25% of the global wheat trade and nearly 20% of the global corn trade.Last week, it was reported that many countries have dangerously low grain supplies. Nader Saad, an Egypt Cabinet spokesman, has raised the alarm that currently, Egypt has only nine months’ worth of wheat in silos. The supply includes five months of strategic reserves and four months of domestic production to cover the bread needs of 102 million Egyptians. Additionally, Avigdor Lieberman, Israel’s economic minister, said on Thursday (3/3/22) that his country should keep “a low profile” regarding the conflict in eastern Europe, given that Israel imports 50 percent of its wheat from Russia and 30 percent from Ukraine.Sign up for my free trading newsletter so you don’t miss the next opportunity!The longer-term potential for much higher grain prices exists, but it’s worth noting that Friday’s close of nearly $12.00 a bushel for wheat is not that far away from the all-time record high of $13.30, recorded 14-years ago. According to Trading Economics, wheat has gone up 75.08% year-to-date while other commodity markets like Oats are up a whopping 85.13%, Coffee 74.68%, and Corn 34.07%.How are other markets reacting to these global events?Year-to-date comparison returns as of 3/4/2022:-9.18% S&P 500 (index), -7.49% DJI (index), -15.21% Nasdaq (index), +37.44% Exxon Mobile (oil), +20.08% Freeport McMoran (copper & gold), -20.68% Tesla (alternative energy), -24.49% Microstrategy (bitcoin play), -40.51% Meta-Facebook (social media)As stock holdings and 401k’s are shrinking it may be time to re-evaluate your portfolio. There are ETFs available that can give you exposure to commodities, energy, and metals.Here is an example of a few of these ETFs:+53.81% WEAT Teucrium Wheat Fund+41.79% GSG iShares S&P TSCI Commodity -Indexed Trust+104.40 UCO ProShares Ultra Bloomberg Crude Oil+59.32% PALL Aberdeen Standard Physical Palladium SharesHow is the global investor reacting to rocketing commodity prices and increasing market volatility?We can track global money flow by monitoring the following 1-month currency graph (www.finviz.com). The Australian Dollar is up +4.25%, the New Zealand Dollar +3.72%, and the Canadian Dollar +0.30% vs. the US Dollar due to the rising commodity prices like metals and energy. These country currencies are known as commodity currencies.The Switzerland Franc +0.96%, the Japanese Yen +0.35%, and the US Dollar +0.00% are all benefiting from global capital seeking a safe haven. As volatility continues to spike, these country currencies will experience more inflows as capital comes out of depreciating assets and seeks stability.We also notice that capital outflow is occurring from the European Union-Eurodollar -4.55% and the British Pound -2.22% due to their close proximity (risk) to the Russia - Ukraine war.www.finviz.comGlobal central banks will need to begin raising their interest rates to combat high inflation!Due to the rapid acceleration of inflation, the US Federal Reserve may have been looking to raise interest rates by 50 basis points at its policy meeting two weeks from now. However, given Russia’s invasion of Ukraine, the FED may become more cautious and consider raising interest rates by only 25 basis points on March 15-16.What strategies can help you navigate current market trends?Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets have begun to transition away from the continued central bank support rally phase and have started a revaluation phase as global traders attempt to identify the next big trends. Precious Metals are starting to act as a proper hedge as caution and concern start to drive traders/investors into Metals and other safe-havens.Now is the time to keep your eye on the ball!I invite you to learn more about how my three Technical Trading Strategies can help you protect and grow your wealth in any type of market condition by clicking on the following link: www.TheTechnicalTraders.com
Tesla CEO Elon Musk To Save His Bitcoins And Other Crypto

Tesla CEO Elon Musk To Save His Bitcoins And Other Crypto

Alex Kuptsikevich Alex Kuptsikevich 15.03.2022 08:36
Bitcoin slightly strengthened over the past day to 38,800 (+0.5%). Ethereum lost 0.8%, while other leading altcoins from the top ten range showed an amplitude from -2.4% (Avalanche) to +3.7% (Terra). According to CoinMarketCap, the total capitalization of the crypto market grew by 0.4% in 24 hours, to $1.73 trillion. The Bitcoin Dominance Index rose 0.3 points to 42.7%. The fear and greed index is at 21 (-2 points) now and is remaining in a state of "extreme fear". The FxPro Analyst Team emphasized that Bitcoin updated its weekly lows around $37,500 today. Subsequently, the first cryptocurrency bounced up, briefly rising above $39,300 in the middle of the day on the news from Elon Musk. The CEO of Tesla said he had no plans to sell his cryptocurrencies. Musk tweeted that he owns not only Bitcoin but also ETH and DOGE. However, BTC did not show a strong reaction to this statement: during the American session, it levelled a slight increase against the backdrop of a fall in US stock indices. Dogecoin reacted to Musk's comment much more violently, jumping more than 7% at the time. According to CoinShares, institutional investors withdrew about $110 million from crypto funds last week, despite seeing the largest capital inflow in three months the week earlier. The European Union abandoned plans to introduce a virtual ban on mining based on the Proof-of-Work (PoW) mechanism. At the same time, Russian State Duma deputy Alexander Yakubovsky said that Russia has a real opportunity to create its own crypto exchanges.
Tesla Stock News and Forecast: Shareholders to vote on TSLA stock split

Tesla Stock News and Forecast: Shareholders to vote on TSLA stock split

FXStreet News FXStreet News 28.03.2022 16:34
Tesla stock surges on news of a potential stock split dividend.TSLA is up at $1,066 of +5.6% in Monday premarket trading.Tesla stock has rallied sharply from early March lows.Tesla stock (TSLA) is back to the top of the social media chatter on Monday, usurping GameStop and AMC in the process. The stock is surging this morning on news of a potential stock split dividend. Tesla previously did a 5-for-1 stock split back in August 2020, and other companies have followed suit, notably Amazon. This makes it easier for retail investors to own the stock when it has a more affordable share price.Tesla Stock News: Stock split imminent?Tesla's board of directors has already approved the plan to split the shares for a stock dividend and will put it to a vote of the shareholders. The news was well-received by retail shareholders who tend to be more active in the premarket than other holders. A stock dividend is exactly what it sounds like. Instead of receiving cash, shareholders receive new shares in the company. This means companies do not use up cash to fund the dividend. Stock dividends are usually dilutive to earnings per share (EPS) as more shares are in issue after the event. Tesla is up nearly 6% before the open. It is not all plain sailing though for the EV giant as more Chinese covid lockdowns are announced. Tesla will close its Shanghai giga plant for at least a day on the back of lockdowns in the city. Tesla Stock ForecastA powerful rally with the next target now set at $1,210. This would set up Tesla's (TSLA) stock to break to all-time highs. Currently, on the longer-term time horizon, the narrative is still bearish with a series of lower highs and lower lows. So breaking $1,210 turns Tesla bullish on all time horizons. Naturally, it is already bullish in the short term after last week's strong rally. Holding above $945 is the key pivot for medium and long-term traders. TSLA 20-hour chartThere is a short-term pivot at $1,000, with high volume at this level. Below sees a volume gap to $945, the key as mentioned above. Tesla chart, 15-minute
(TSLA) Tesla Stock Split: Should You Buy Tesla Shares?

(TSLA) Tesla Stock Split: Should You Buy Tesla Shares?

Dividend Power Dividend Power 01.04.2022 14:53
In recent weeks there have been several companies announcing stock splits. First, there are the big tech giants such as Alphabet (GOOGL), Amazon (AMZN), and now Tesla has jumped up to make their announcement of a stock split, the second stock split in two years. Tesla has not announced the split ratio yet but will do so after shareholder approval. You may be wondering why these mega-cap tech companies are doing so many stock splits. These companies use stock splits in many ways. For example, they use stock splits to get into a different Index like the Dow 30, which is based on the stock price. Or they may be trying to get a lower share price to entice retail investors to invest. Many of these companies stocks have gotten a little expensive for retail investors. They could easily buy more shares through fractional shares, which can be purchased through some investing apps. However, the appeal of buying cheaper shares may bring in more retail investors to hold whole shares of a company. The EV Market Impact There are many reasons why Tesla could be doing a stock split, but one of the biggest reasons is its control over the electric vehicle (EV) market. With the growing inflationary prices of gasoline and petrol worldwide, people are looking for other options to combat these prices. One way is to drive less, but in a car-centered culture like the USA, that is not an option taken very seriously. The second option would be to drive an EV. In the 4th quarter of 2021, car buyers bought 21% fewer vehicles. However, the vehicles shoppers did buy were EVs, and sales boomed 72% higher than usual in the US. EV car sales usually make up 1% - 2% of the car sales, but between October and December of 2021, EV car sales made up 4.5% - 5% of all car sales. Out of around 148,000 EV cars sales reported in the US in the 4th quarter of 2021, 72% came from Tesla. Of course, many companies besides Tesla are making EVs, but Tesla has been innovating and marketing continuously, allowing the company to remain the market leader. The Expansion of Tesla Tesla is in a growth phase with many people purchasing their vehicles; they see the high demand. Consequently, the company is opening a new Tesla factory in Germany to provide over 500,000 Teslas to Europe. In addition, Tesla is about to open a new factory in Austin, Texas. With the opening of the new factories, you can see that demand is increasing for EVs and especially Tesla cars. People want a vehicle that can save them money. Tesla vehicles are answering the call of consumers. Why is Tesla Splitting Their Stock The year 2022 seems to be the year for stock splits, and almost every mega-cap tech company is starting to do it. Since Tesla is once again splitting its stock, here are some reasons they may be doing so. To Help Retail Investors As you may have noticed, their company is doing well on all the fundamentals. They are producing quality products and dominating the sector; revenue and earnings are increasing. With the rise in popularity of Tesla and its vehicles, more retail investors would like to own this company. At more than $1,000 per share, the stock price is still too steep for most regular retail investors. Of course, they could buy a diversified S&P 500 Index fund or ETF like SPY or VOO, but it is not like holding whole shares of Tesla. Splitting the stock allows average retail investors to purchase shares at a lower price in the stock market and be a part of this significant growth. Adding Value to the Price Announcing a stock split doesn't happen often. For example, Amazon did a few of them from 1997 to 1999 and has not split the stock again until 2022. Tesla is doing it for the second time in 2 years, and the last time they split the stock, the price rose to $2,000 per share. After this most recent announcement, the price went up 8% on March 29th when it was announced the split would happen. Teslas added $84 billion to its market capitalization in that one day alone. That is approximately the market cap of Volvo. Think about that. The value of Telsa has gained so much. They want the company not to be just owned by their employees but allow the retail investors to have more ownership of the company. As that happens, the value of the company will continue to rise. Become Competitive for Employees Another reason for the stock split could be the employee stock options. Many employees have stock options, and with the high prices of the stock, it can be challenging to exercise some of these options without having significant tax implications. With a lower price, the employees can have an opportunity to exercise some of their options and continue to diversify their wealth and portfolio allocations. With many other tech giants doing the same, Tesla creates a more competitive atmosphere in retaining good employees. Nicholas Colas, a co-founder of DataTrek Research, said, "A lower-priced stock makes it easier for employees with equity as part of their compensation to sell a more specific amount to satisfy tax liabilities and manage their personal wealth," After one company starts doing stock splits, many others will do the same to compete or retain similar talent. So it is not just a competition over the market cap in the stock; it is a competition over the best talent to create a thriving company. What Should You Do? There are many options that you could do. Stock splits are happening more often now than they have in recent years. Many companies are growing in market cap higher than they had ever imagined. For instance, Apple (APPL) became a $3 trillion stock earlier this year. You could start by buying some of these companies' stocks or keep it simple and invest in a nice index fund that holds these companies. If you are a retail investor, then the news of stock splits can be good news. You can add more shares of your favorite companies to your portfolio at a lower price per share. Author Bio: Dividend Power is a self-taught investor and blogger on dividend growth stocks and financial independence. Some of his writings can be found on Seeking Alpha, TalkMarkets, ValueWalk, The Money Show, Forbes, Yahoo Finance, FXMag, and leading financial blogs. He also works as a part-time freelance equity analyst with a leading newsletter on dividend stocks. He was recently in the top 1.2% (98 out of over 8,252) of financial bloggers as tracked by TipRanks (an independent analyst tracking site) for his articles on Seeking Alpha. Disclaimer: Dividend Power is not a licensed or registered investment adviser or broker/dealer. He is not providing you with individual investment advice. Please consult with a licensed investment professional before you invest your money. 
Can GBP/USD Reach 1.24!? Will EUR/GBP Prove British Pound's Strength? It's Good To Diagnose EUR/CHF Performance This Week. Can DXY (US Dollar Index) Go Down?

Twitter-Elon Musk Interaction Shocks Investors, Price Of Crude Oil Fluctuates Again

Swissquote Bank Swissquote Bank 05.04.2022 10:16
Twitter jumped 27% in a single move on the news that Elon Musk took a 9.2% stake in the company. The jump in Twitter shares gave an energy boost to the US equities, especially to the technology stocks. Tesla jumped 5.5% on record deliveries. But news regarding the war and oil prices were less encouraging. EU leaders will reportedly meet tomorrow and announce additional. Lithuania became the first European country to announce a total ban on Russian gas imports, and the possibility of other nations joining Lithuania in banning Russian oil and gas gives a boost to oil bulls. US crude quickly bounced above the $100 mark yesterday on escalating tensions in Ukraine. Elsewhere, US factory orders fell for the first time in ten months on supply constraints, the PMI data will give a hint on the European activity levels amid war in Ukraine, and the Reserve Bank of Australia (RBA) kept its policy rate unchanged at the historical low of 0.10% for the sixteenth consecutive month. The Aussie rebounded more than 9% against the US dollar since the beginning of February, as iron ore prices jumped due to the Ukraine war, and the medium-term outlook remains positive for the Aussie, as long as commodity prices remain supported by geopolitical threat to the supply. Watch the full episode to find out more! 0:00 Intro 0:25 Twitter rallied 27% as Elon Musk bought 9.2% stake 1:46 ... pulled US tech stocks higher 2:16 Tesla revealed record car deliveries 4:29 Oil rebounded from $100pb ahead of new Russia sanctions 7:00 Investing in rare earth metals 8:12 US factory orders, PMI data & RBA decision Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020.
On Concentrated Positions

On Concentrated Positions

David Merkel David Merkel 13.04.2022 03:29
Photo Credit: John.U || Look at all those eggs in one basket! The owner *is* watching it carefully, right? Jason Zweig recent wrote an article on owning stock in the company that you work for. Then today in his WSJ newsletter he asked the following question: What’s the most concentrated investment position you’ve ever had? (In other words, what single investment made up the greatest proportion of your portfolio?) Did it work out well or poorly? What did you learn from it? I have one article to answer both questions called Life with Wife. It’s a cute article which runs through two times in my life where I had an overly concentrated investment position. The first one was regarding The St. Paul (acquired by The Travelers), where I took my first big bonus, and put it all into shares of The St. Paul. I got derided for doing that by my colleagues in the investment department, but with a AA balance sheet, trading at 55% of tangible book value, and 8x forward earnings, I felt I had a reasonable provision against adverse deviation — a margin of safety. If you read the article, you will see that I almost doubled my money in six months, then sold. At the peak it was half of my net worth, and I had a mortgage then. So should you invest in your own company? Well, are you working for Tesla or Enron? I am being facetious here, as the guys at Enron thought they were working for a cutting-edge company like Tesla. But any analyst worth his salt would have seen that free cash flow at Enron was deeply negative. I have a neighbor who is a Tesla mechanic. As I was mowing my lawn one day, he waved me over. He wanted advice. He hinted to me how much his Tesla shares were worth. He had consulted an investment advisor who had told him to sell the wad, and the advisor would create a growth and income portfolio allowing him to retire (he is in his 60s). But he was conflicted, because Tesla was doing so well. He asked me what I would do if I was in his shoes. (Note: the TSLA shares were likely 95% of his net worth.) I said, “Do half, or sell 10-20% per year over time, until you do sell half.” Doing that frees you from the binary decision that you might regret. After selling half, if the price goes up, you still have more capital gains. If the price goes down, you sold some at a good time. You can be happy with yourself no matter what. I have no idea what my neighbor did. Hopefully he sold some. The second situation in Life with Wife regarded my only significant private equity position, Wright Manufacturing, which makes the best commercial lawn mowers in the world. At that point, my holdings were 15% of my net worth, with no mortgage. The founder was throwing everything into growth, and sacrificing safety. If he hadn’t been my friend, I probably would not have invested with him. As it was, when I sold half, I had recouped my investment. After the Life with Wife article, I bought out several of the founder’s relatives, ending up with 2.2% of the company. I’ve made 5x on my money here, with distributions, and using the very thin “market” for shares. One of the founder’s sons leads the company now, and he is a far better manager than his father. I like this company, and am more likely to buy more than to sell at this point. But at this point, it is only 10% of my net worth. I may offer to buy more, but I am thinking about it. It trades at 6x earnings, with a stronger balance sheet than the founder worked with, and a stronger competitive position. The most recent price is still below where I sold it to the second largest shareholder. Price discovery is tough when there are only 20 shareholders, and new shareholders may only enter at the pleasure of the board of directors. Closing So, over my life, I have reduced the relative amount at risk on my biggest positions. Does that make sense? Of course — I have less time to make up for mistakes as I grow older. The only people who should be taking high risks when they are old are who are ultra-rich. If they fail, they will still have enough for a moderate existence. Be careful with concentrated positions. You need certainty about safety most, earnings second, and growth third. Otherwise you are a gambler, and most gamblers lose.
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Fluctuations Of Crowdstrike, Apple (APPL) To Rise Again, Elon Musk Makes Other Twitter Shareholder Angry

Saxo Bank Saxo Bank 13.04.2022 11:25
Equities 2022-04-13 05:30 6 minutes to read Summary:   Crowdstrike shares surge putting cybersecurity in the limelight. Apple and BHP poised to announce share buy backs, which will support further share price growth. Oil rocks back over US$100 lifting oil stocks in New York and Australia. A Twitter shareholder sues Elon Musk for allegedly committing fraud. Iron ore and aluminium are back in vouge, boosting Rio Tinto shares. US defaults to double according to S&P Global. New Zealand makes its biggest increase in interest rates in 22-years. Co-written by Market Strategists Jessica Amir in Australia, Redmond Wong in Hong Kong. What’s happening in equites that you need to know? US stocks fell for the third day. The S&P 500 (US500.I) and the Nasdaq 100 (USNAS100.I) lost 0.3%. As always, there were bright sparks at the stock level. The world’s biggest cybersecurity company, Crowdstrike (CRWD) rose 3.2% to US$223.51 (its highest level since November last year), after Goldman Sachs upgraded the stock to a buy. We’ve previously mentioned Crowdstrike as a stock to watch. It makes 94% of its money from subscriptions, and we like businesses like these, given they are set to benefit from elevated demand to address cyberattack fears. The market also likes Crowdstrike with 93% of analysts rating the stock as a BUY. Goldman Sachs expects Crowdstrike’s shares to rise to $285 in a year. Also in MegaCaps, Apple (AAPL) shares jumped over 1% after whispers that Apple could announce a buyback of US$80-$90 billion (and buy backs support share price growth). Hang Seng Index (HSI.I) and CSI300 (000300.I) are little changed. Hang Seng Tech (HSTECH.I) was up 0.6%.  Energy and mining stocks outperformed.  Zijin Mining (02899) surged 7%.  Jiangxi Copper (00358), China Molybdenum (03993), MMG (0128) rose more than 5%.  CNOOC (00883) rallied 4% and China Coal was up from the 6%.  In A shares, logistics names outperformed while real estates, airlines, online entertainment led declines.  Twitter (TWTR) shareholders sue Elon Musk (TSLA CEO). A Twitter, shareholder sued Elon Musk for allegedly committing fraud by delaying the disclosure of his ownership of more than 5% of Twitter, so Musk could buy more shares at a cheaper price. The investor said Musk should  have disclosed his holding by March 24, instead of April 1. Twitter shares rose 27%, from $39.31 on April 1, to $49.97 on April 4. Twitter shareholder, Marc Bain Rasella is also looking to represent a class of investors who sold Twitter shares from March 24 to April 1. Crude oil (OILUKJUN22 & OILUSMAY22) jumps 6% to $101, ... ...as OPEC said the obvious, that’s it’s impossible to replace supply losses from Russia, while China also hints of restrictions easing. This supports gains in oil stocks in the US overnight and in Australia today.  The Australia share market more (ASX200) rose 0.2% by 1pm local time with energy and mining stocks fueling the market higher. Also of note, Rio Tinto (RIO) rose 2.2% after the aluminium and iron ore price extended their rebound. Both prices are important to Rio as it makes 58% of its revenue from iron ore and 22% from aluminium . Also consider demand for aluminium  is expected to grow with company’s like Apple and Nestle's Nespresso to use more of the material to reduce CO2 emissions. Iron ore (SCOA) rebounded yesterday rising 2.5%, but today it’s about 0.9% lower, but holds 8-month highs, at US$154.25. It comes as China again pledged to stabilise its economy and this brightened the outlook for steelmaking ingredient. BHP (BHP) shares are holding at $51.71, and remain in their long term uptrend. So it's worth keeping an eye on BHP. BHP is also touted to annouce a record profit this year and a share buy back, which also supports share price growth. What you need to consider US defaults to double according to S&P Global.  S&P Global Rating anticipates the US’s default rate will swell from the current 1.5%, to 3% by year-end, amid financial conditions tightening. In China, the S&P Global Ratings expects more property developer defaults, with $18 billion in maturing debt and the likelihood of home sales falling 15-20%. Inflation is uncomfortably high.  March CPI hit 8.5% year-on-year. The hottest inflation since 1981. Core CPI moderated a bit, mostly due to a cooling of oil prices, and rose 6.5%. This is still the highest rate since 1982. The largest prices rises were in; fuel oil (70%), gas (48%), used cars (35%), hotels (29%), airfares (24%) and utility gas (22%) on a year on year basis. See the full list here (scrolling to pdf page 9). Simply this tells us, the US Federal Reserve is behind in fighting inflation, so expect a 0.5% interest rate hike at the May FOMC meeting, with rates to hit 2.6% at the end the year. In RMB terms, March China exports rose 12.9% while imports fell 1.7%.  In USD terms, March exports climbed 14.7% from a year ago and imports declined 0.1%. Trade surplus increased to USD47.4 billion (vs consensus $21.7bln, Feb $30.6bln). New Zealand makes its biggest increase in interest rates in 22-years,  while also announcing quarantine free travel. The RBNZ increased interest rates by 0.5% to 1.5%. The surprise caused the New Zealand stock market to fall 0.4% with their tech stocks falling 1.4%. However, as NZ announced quarantine-free travel, the travel industry got a kick, Auckland International Airport (AIA) shares rose 1.1% higher. Trading ideas to consider Aussie dollar and Kiwi ‘up and at em’, amid travel boost.  The Australian dollar (AUDUSD) is back in vogue, rising for the second day, after Australian business confidence rose to its highest level in 5 months. While the NZ dollar (NZDUSD) also rallied for the second day, heading toward 0.69 US. It’s worth watching these two currencies as travel takes off as well between the two nations. Travel stocks.  Air stocks like Air New Zealand (AIZ) and Auckland International Airport (AIA), and Qantas (QAN), Singapore Airlines (SIAL), China Eastern Airlines (CEA) could be worth watching as they have not recovered from the covid falls in 2020. If China restrictions ease and tourism reopens, it’s worth keeping these on your radar. For a global look at markets – tune into our Podcast 
Tech Stocks: Elon Musk Firing Employees!? Can (TSLA) Tesla Stock Price Change If Costs Cut Is Introduced? | Saxo Bank

Popular Stocks Like MSFT, APPL And MSFT Will Publish Their Earnings Shortly. How Will Indices (e.g. SPX) React?

Paul Rejczak Paul Rejczak 13.04.2022 15:41
Stocks fluctuated following their recent decline on Tuesday and the S&P 500 index closed slightly below the 4,400 level. Is this still just a downward correction? The S&P 500 index lost 0.34% on Tuesday following its Monday’s decline of 1.7%. There is still a lot of uncertainty concerning the Ukraine conflict and Fed’s monetary policy tightening plans. On Monday it led to a more pronounced profit-taking action. However, the coming quarterly earnings releases season may be a positive factor in the near term. This morning the broad stock market is expected virtually flat following the Producer Price Index release. The nearest important resistance level is now at around 4,475-4,500, marked by the recent support level and Monday’s daily gap down. On the other hand, the support level is at 4,350-4,400. The S&P 500 index retraced more of its March rally, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Futures Contract – Short-Term Consolidation Let’s take a look at the hourly chart of the S&P 500 futures contract. Recently it broke below the 4,400 level and our profitable long position was closed at the stop-loss (take-profit) level of 4,440. Overall, we gained 100 points on that trade in a little less than two months’ time (it was opened on Feb. 22 at 4,340 level). So now we will wait for another profit opportunity. (chart by courtesy of http://tradingview.com): Conclusion The S&P 500 index is expected to open 0.1% lower following the producer inflation number release. Stocks will likely extend their consolidation. For now it looks like a relatively flat correction within a short-term downtrend. Here’s the breakdown: The S&P 500 index trades within a short-term consolidation following the recent declines. Our profitable long position was closed at the 4,440 level (a gain of 100 points from the Feb. 22 opening). Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Paul Rejczak,Stock Trading StrategistSunshine Profits: Effective Investments through Diligence and Care * * * * * The information above represents analyses and opinions of Paul Rejczak & Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. At the time of writing, we base our opinions and analyses on facts and data sourced from respective essays and their authors. Although formed on top of careful research and reputably accurate sources, Paul Rejczak and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Rejczak is not a Registered Securities Advisor. By reading his reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Paul Rejczak, Sunshine Profits' employees, affiliates as well as their family members may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Can GBP/USD Reach 1.24!? Will EUR/GBP Prove British Pound's Strength? It's Good To Diagnose EUR/CHF Performance This Week. Can DXY (US Dollar Index) Go Down?

Shocking! Elon Musk To Acquire Twitter (TWTR)!? What About Tesla (TSLA)? Will He Swap The Company For Twitter!? Who Owns Tesla Now!?

Mikołaj Marcinowski Mikołaj Marcinowski 14.04.2022 12:30
Is it possible that Elon Musk will acquire Twitter!? It's not the first time Tesla's CEO is shocking the world and the markets with his "shopping" plans. Firstly Elon Musk had become the largest share holder, then rejected joining the board and today, according to Investing.com...  âš ï¸ÂBREAKING: *ELON MUSK SAYS OFFERING TO BUY 100% OF TWITTER FOR $54.20 PER SHARE IN CASH$TWTR pic.twitter.com/QRXUxGDE0C — Investing.com (@Investingcom) April 14, 2022 Look at this! (TWTR) Twitter Stock Price Has Jumped in Premarket! TWTR Stock Price is influenced by many factors - fluctuations are caused by i.a. Elon Musk rhetoric and market moves. The most significant were acquiring ca. 9% of Twitter's stake and then rejecting to become a member of board. What's more, Twitter has been commented by Elon Musk before. Eg. he was wondering if Twitter "is dying" showing the statistics of most popular accounts' activity: Most of these “top” accounts tweet rarely and post very little content. Is Twitter dying? https://t.co/lj9rRXfDHE — Elon Musk (@elonmusk) April 9, 2022  Twitter Stock Price Chart (TWTR) What about Tesla (TSLA)? It has decreased! What Will Happen On The Market Opening? Tesla had its ups and down throughout last five days. The brand is definitely growing and recently opened manufacture in Germany will surely make the price go up even further. Elon Musk published the link to the offer he made What will be the next targets of famous inventor? Which companies are in interest of Tesla's CEO? I made an offer https://t.co/VvreuPMeLu — Elon Musk (@elonmusk) April 14, 2022   Source/Data: Investing.com, TradingView.com Charts: Courtesy of TradingView.com
Poland’s central bank raises rates by another 75 basis points

(TSLA) Tesla To Beat A Record!? (NFLX) Netflix Earnings Has Moved The Markets, But Elon Musk's Company Surely Has Something Up Its Slevee!

Walid Koudmani Walid Koudmani 20.04.2022 13:22
Netflix plunged over 20% in the after-hours trading, following the release of Q1 2022 earnings report. Subscriber base shrank by 200,000, marking the first drop in overall users in more than a decade. The drop was led by a loss of 700 thousand subscribers from Russia as the company suspended services in the country and as competition in the streaming sector continues to become more challenging. Read next: (UKOIL) Brent Crude Oil Spikes to Highest Price For April, (NGAS) Natural Gas Hitting Pre-2008 Prices, Cotton Planting Has Begun US indices have been increasingly reactive to this earning season Today, investors will focus on the highly anticipated earnings release form Tesla, which managed to mostly mitigate the impact of supply shortages and rising inflation thus far while expanding its production facilities. While growing concerns relating to covid-19 related lockdowns in China persist, investors will be keeping a close eye on Q1 results along with the company's outlook for the rest of 2022 after Elon Musk attracted additional attention after offering to buy Twitter at a significant premium. US indices have been increasingly reactive to this earning season after many investors have started to look past the initial shock caused by the Russia-Ukraine conflict and today could be no exception. Read next: Altcoins' Rally: Solana (SOL) Soars Even More, DOT and SHIBA INU Do The Same! | FXMAG.COM Oil prices attempt to recover after 6% drop Oil is trading higher after prices dropped significantly following the long easter weekend. WTI broke above $103 per barrel while Brent jumped above $108 at the start of today's session but appear to remain constrained in a narrow range for the time being. Traders await today's EIA inventory report which is expected to show a 2.5 million barrel increase after yesterday's API report defied expectations by indicating a 4.5 million barrel drop. While rising demand concerns caused by the increase in covid lockdowns in China continue to pressure the price, the uncertain situation relating to the potential import ban of Russian energy from Europe remains a key topic to watch and may cause noticeable volatility if things were to change suddenly.  
(TSLA) Tesla And Elon Musk Continue to Outperform the Market! What About Elon Musk-Twitter Negotiations' (TWTR) Influence?

(TSLA) Tesla And Elon Musk Continue to Outperform the Market! What About Elon Musk-Twitter Negotiations' (TWTR) Influence?

Rebecca Duthie Rebecca Duthie 21.04.2022 15:08
Since the market opened this morning, the price of Tesla’s stock has increased largely, this surge came after the earnings announcement for Tesla that took place late one Wednesday, which showed large increases in earnings and profits, reflecting unexpected growth for Q1. Tesla share price has surged in the past 24 hours as a result of musks earning announcement that took place late on Wednesday (CET) Read next: (XAGUSD) Price of Silver Vs. U.S Yields, Lumber and Corn Futures Dependent on Demand and Supply | FXMAG.COM The stock price was also affected by Musk’s determination to take over Twitter (TWTR) The price of Tesla's stock has shown very volatile price movements over the past week as a result of market sentiment and current market conditions. In addition, the stock price was also affected by Musk’s determination to take over twitter, an announcement that took place just over a week ago, since then the price has been rising again in general. Read next: Unexpectedly Gold Price (XAUUSD) Falls, Canada And Chicago - Weather Makes Wheat Futures Fluctuate. The Price Of Palladium - Industrial Activity Is Taking Strain | FXMAG.COM Research has shown that the value of Tesla's stock has a correlation between stock movements in the near term and earnings estimates. Currently the market sentiment for the stock is mixed as investors in general are unsure where the markets will go at this point and investors are seemingly more risk-averse amid the rising inflation and possibility of a looming recession. Tesla Stock Price Chart Sources: Finance.yahoo.com, investors.com  Read next: ECB Announcements to Possibly Tighten Monetary Policy Strengthens the Euro. EUR/USD, EUR/GBP, AUD/NZD and EUR/CHF All Increased | FXMAG.COM  
The Swing Overview - Week 16 2022

The Swing Overview - Week 16 2022

Purple Trading Purple Trading 22.04.2022 15:00
The Swing Overview - Week 16 Jerome Powell confirmed that the Fed will be aggressive in fighting the inflation and confirmed tighter interest rate hikes starting in May. Equity indices fell strongly after this news. Inflation in the euro area reached a record high of 7.4% in March. Despite this news, the euro continued to weaken. The sell-off also continued in the Japanese yen, which is the weakest against the US dollar in last 20 years.  The USD index strengthens along with US bond yields Fed chief Jerome Powell said on Thursday that the Fed could raise interest rates by 0.50% in May. The Fed could continue its aggressive pace of rate hikes in the coming months of this year. US 10-year bond yields have responded to this news by strengthening further and have already reached 2.94%. The US dollar has also benefited from this development and has already surpassed the value 100 and continues to move in an uptrend. Figure 1: US 10-year bond yields and USD index on the daily chart Earnings season is underway in equities Rising interest rates continue to weigh on equity indices, which gave back gains from the first half of the last week and weakened significantly on Thursday following the Fed’s information on the aggressive pace of interest rate hikes.   In addition, the earnings season, which is in full swing, is weighing on index movements. For example, Netflix and Tesla reported results last week.   While Netflix unpleasantly surprised by reducing the number of subscribers by 200,000 in 1Q 2022 and the company's shares fell by 35% in the wake of the news, Tesla, on the other hand, exceeded analysts' expectations and the stock gained more than 10% after the results were announced. Tesla has thus shown that it has been able to cope with the supply chain problems and higher subcontracting prices that are plaguing the entire automotive sector much better than its competitors.   The decline in Netflix subscribers can be explained by people starting to save more in an environment of rising prices. Figure 2: The SP 500 on H4 and D1 chart The SP 500 index continues to undergo a downward correction, which is shown on the H4 chart. The price has reached the resistance level at 4,514-4,520. The price continues to move below the SMA 100 moving average (blue line) on the daily chart which indicates bearish sentiment.  The nearest resistance according to the H4 chart is at 4,514 - 4,520. The next resistance is around 4,583 - 4,600. The support is at 4,360 - 4,365.   The German DAX index The DAX is also undergoing a correction and the last candlestick on the daily chart is a bearish pin bar which suggests that the index could fall further. Figure 3: The German DAX index on H4 and daily chart This index is also below the SMA 100 on the daily chart, confirming the bearish sentiment. The price has reached a support according to the H4 chart, which is at 14,340 - 14,370. However, this is very likely to be overcome quickly. The next support is 13 910 - 14 000. The nearest resistance is 14 592 - 14 632.   The DAX is affected by the French presidential election that is going to happen on Sunday April 24, 2022. According to the latest polls, Macron is leading over Le Pen and if the election turns out like this, it should not have a significant impact on the markets. However, if Marine Le Pen wins in a surprise victory, it can be very negative news for the French economy and would weigh on the DAX index as well.   The euro remains in a downtrend The Fed's hawkish policy and the ECB's dovish rhetoric at its meeting on Thursday April 14, 2022, which showed that the ECB is not planning to raise rates in the short term, put further pressure on the European currency. The French presidential election and, of course, the ongoing war in Ukraine are also causing uncertainty.  Figure 4: The EURUSD on the H4 and daily charts. The inflation data was reported last week, which came in at 7.4% on year-on-year basis. The previous month inflation was 5.9%. This rise in inflation caused the euro to strengthen briefly to the resistance level at 1.0930 - 1.0950. However, there was then a rapid decline from this level following the Fed's reports of a quick tightening in the economy. A support is at 1.0760 - 1.0780.   The sell-off in the Japanese yen is not over The Japanese yen is also under pressure. The US dollar has already reached 20-year highs against the Japanese yen (USD/JPY) and it looks like the yen's weakening against the US dollar could continue. This is because the Bank of Japan has the most accommodative monetary policy of any major central bank and continues to support the economy while the Fed will aggressively tighten the economy. Thus, this fundamental suggests that a reversal in the USD/JPY pair should not happen anytime soon. Figure 5: The USDJPY on the monthly chart In terms of technical analysis, the USD/JPY price broke through the strong resistance band around the price of 126.00 seen on the monthly chart. The currency pair thus has room to grow further up to the resistance, which is in the area near 135 yens per dollar.  
The Scale Versus the Casino

The Scale Versus the Casino

David Merkel David Merkel 28.04.2022 07:55
Photo Credits: Jen and www.david baxendale.com with help from pinetools || The casino is exciting. The scale is honest and unrelenting. I want to give an update to one of the major concepts of Ben Graham, in order to make it fit the modern era better. Ben Graham said: “In the short run, the market is a voting machine but in the long run, it is a weighing machine.”https://www.goodreads.com/quotes/831517-in-the-short-run-the-market-is-a-voting-machine quoted from The Intelligent Investor So let me modify it: In the short run, the market is a casino, but in the long run, it is a scale. Is this an improvement? Probably not, but speculation has become so rampant that it may be a necessary modification to change voting machine to casino. The voting machine makes sense, but typically we think of voting as being democratic. We only get one vote per person. Markets are different. Someone who brings a little money to the market will not have the same influence as the one who brings a lot of money to the market. Thus my analogy of the casino, though typically casinos will place limits on how much the casino will wager. They want to avoid random large losses so that they can live to extract money from rubes for many years to come. The winner can brag that he “broke the bank,” but the casino survived to play on. Bill Hwang and his CFO were formally charged with fraud today. What did they do? They synthetically borrowed a lot of money from investment banks to own huge amounts of a few companies. Their buying pushed the prices of the stocks higher, allowing them to borrow more against the positions. But eventually as the stocks they owned had some bad results, the margin calls on his positions wiped him out as the stock prices fell. The scale trumped the casino. The same is true of crypto and meme stocks. Cryptocurrencies require a continuing inflow of real cash (admittedly fiat money) in order to appreciate. If people stop buying crypto on net, and that may be happening now, cryptocurrencies will decline. The scale says crypto is a zero — no intrinsic value. The casino begs for more people to bring real money to buy fake money. That applies to meme stocks as well. You can throw a lot of money at a stock and it will rise. But for it to stay there or rise further, it will need increasing free cash flows to validate the value of the firm. Going back to crypto, it lacks any link to the real economy. Crypto will only become legitimate when you can buy groceries and gasoline at a fixed amount of bitcoin that varies less than the same price in US dollars. As a final note on the Scale versus the Casino, I give you Elon Musk. He borrows against his shares of Tesla to buy Twitter. He either did not realize or ignored the fact that he could lose his stake in Tesla if the price of Tesla falls enough. Do you really want the margin desk to control your fate? This may not totally impoverish Musk, but it is not impossible that he could the entirety of his holdings of Tesla in order to keep his holdings of the unprofitable Twitter. All it would take is for short sellers to push Tesla below $740, and then the margin desk starts selling his shares into a falling market. Momentum, aided by an agreement leading to forced selling. The market abhors a vacuum. So it is for those who assume that things will continue to go right for them.
Tesla Stock News and Forecast: TSLA got help from Shanghai to reopen Giga plant

Tesla Stock News and Forecast: TSLA got help from Shanghai to reopen Giga plant

FXStreet News FXStreet News 03.05.2022 16:31
TSLA stock recovered on Friday to close up 3.7% at $902.94. Tesla stock has been under pressure from Musk selling the stock for Twitter deal. Reports surfaced of a club of billionaires urging Musk on for the TWTR deal. News just in from a Reuters report says that Tesla received help from Shanghai authorities to help Tesla reopen its Giga Shanghai factory. A letter seen by Reuters claimed to be from Tesla says that Shanghai authorities helped transport 6,000 workers to the factory and that authorities also helped to disinfect the plant. TSLA stock is trading at $906.45, up 0.5% in Tuesday's premarket. Tesla (TSLA) stock recovered a decent bit of ground on Monday as the US equity indices staged a late recovery to move higher. The Nasdaq was the big winner closing up 1.7% but naturally, Tesla being high beta, outperformed that and settled nearly 4% higher. The stock remains well below recent levels but may be set for a comeback as sentiment reaches extremely bearish levels, meaning a countertrend rally could be set to unfold this week. That is once we get through the Fed's interest rate decision. However, with most participants either short or neutral we expect something of a positioning rally Tuesday and Wednesday as investors rebalance from overly bearish positions. Yes, the Fed will hike 50bps but the market has this well priced in. The risk-reward is for a less than hawkish commentary and a strong equity market rally. The bad news and overly hawkish commentary are expected. Anything even slightly more accomodating will see a rush back to equities. Tech is one of the most beaten-down sectors so it will stand to have the strongest rally. Don't say you haven't been warned. Tesla (TSLA) stock news: Billionaires pitching Twitter deal Some interesting news over the weekend from an article in the Wall Street Journal. The paper reports that a group of billionaires has been urging Elon Musk to go ahead and purchase Twitter (TWTR). The Wall Street Journal reported cited a group including some former Paypal execs, of which Mr. Musk is one and Peter Thiel another one. It is not clear if this influenced Mr. Musk in any way and he does always appear to be very definite in his own views and motives. Twitter (TWTR) stock news: Musk reducing margin loan financing? TWTR stock also traded higher on Monday as it appears Elon Musk is in talks to reduce his collateral on the Twitter deal. It was revealed last week that Elon Musk had to put down a large stake of his Tesla holdings as collateral, but a Reuters report suggested he is in talks with Apollo Global Management (APO) and Ares Management (ARES) to reduce the margin loan element of his Twitter financing. This should naturally help relieve the pressure on Tesla stock and was partly the reason for Monday's strong rally. Both Apollo and Ares are private equity firms. Tesla (TSLA) stock forecast: Potential for short-term bounce Very little of note to comment on here compared with last week. TSLA stock price remains in a medium-term downtrend but we have some potential for a short-term bounce. $975 is the key resistance. Tesla (TSLA) stock chart, daily Below is the 15-minute chart, showing more detail on a short-term basis. Witness the large volume gap from $920 to $975, so a move above $920 should then accelerate quickly to fill this gap. Tesla (TSLA) stock chart, 15 minute
(DOGE) Dogecoin and Musk - How Elon Musk Has Single Handedly Created Price Changes In This Memecoin.

(DOGE) Dogecoin and Musk - How Elon Musk Has Single Handedly Created Price Changes In This Memecoin.

Rebecca Duthie Rebecca Duthie 09.05.2022 17:41
Summary: The history of Elon Musk and Dogecoin. Dogecoin’s possible multiple uses going forward.   Read next: Shell (SHEL) Stock Price Soars Along With The Rest Of The Industry.    The Dogecoin drone show. At the latest Tesla launch in Texas in April, Elon Musk used drones to project the symbol of Dogecoin, the public display of support caused the price to rally high initially. However, as of today the market has restored to the norms for the price of this cryptocurrency. Elon Musk has hinted in a series of tweets that subscribers and members may be able to pay for their Twitter (TWTR) accounts using their Dogecoins going forward. Inlight of Musks plans to take over Twitter, this could be a likely outcome. It is no surprise that Musk is a big fan of Dogecoin, he has integrated the crypto coin into Tesla by allowing the purchase of accessories with Dogecoin and plans to fund some of SpaceXs missions with Dogecoin going forward. The volatility seen by this coin is due to both investor sentiment and Elon Musk's interest in it. Over the past weeks the price of DOGE has been falling, this doesn't come as a surprise given the current global investor sentiment, going forward it wont come as a surprise to see Musk try to come to the coins rescue. DOGE Price Chart   Read next:  Lyft Stocks Face Major Negative Sentiment Despite Q1 Results Exceeding Expectations.    Sources: finance.yahoo.com
Tech Stocks: Tesla Stock News and Forecast: As TSLA struggles, will the TWTR deal still go ahead at $54.20?

Tech Stocks: Tesla Stock News and Forecast: As TSLA struggles, will the TWTR deal still go ahead at $54.20?

FXStreet News FXStreet News 12.05.2022 16:35
Tesla stock falls just over 8% on Wednesday. Twitter stock also falls and is now nearly 20% below its takeover price. TSLA still holding above $700 key support. Tesla (TSLA) stock suffered another humbling day on Wednesday as it yet again suffered more steep losses. As the broader equity market appears to crash, so too does the Tesla share price. This time it dropped by 8% to trade into the low $700s. $700 was the low seen back in February when market panic sold the Ukraine invasion news. Since then Tesla has recovered and held up well. Part of this was the reasonably good earnings quarter it posted. Now though a combination of macro factors and the Twitter (TWTR) deal are weighing on the stock. Read next: Stablecoins In Times Of Crypto Crash. What is Terra (UST)? A Deep Look Into Terra Altcoin. Terra - Leading Decentralised And Open-Source Public Blockchain Protocol | FXMAG.COM Tesla Stock News The latest Tesla recall news hit yesterday, and that certainly helped the stock underperform all the main indices. Tesla has had to recall 130,000 vehicles due to CPU problems affecting the central display unit. There have been a number of recalls for Tesla vehicles this year, none of which seems to have hindered the share price. But this environment has turned more bearish, and any bad news is seized upon. This week we also have had news of a supply problem hindering production at Giga Shanghai, which comes just days after getting the factory back online after covid lockdowns. Adding to pressure on Elon Musk but not directly attributable to Tesla is a report from The Wall Street Journal saying that Elon Musk is facing a federal probe over delays in his filing for his initial stake in Twitter. Read next: Altcoins: What Is Polkadot (DOT)? Cross-Chain Transfers Of Any Type Of Asset Or Data. A Deeper Look Into Polkadot Protocol | FXMAG.COM We also note a report from Bloomberg saying smaller investors and hedge funds will get the chance to invest in the Twitter acquisition by way of special purpose vehicles that pool money together. The minimum investment is $5 million. This is not reassuring in our view. Still scrambling around for investors at this late stage in this type of market does not inspire confidence in the deal going through in its current guise. Hindenberg Research also released a report outlining similar concerns last week. Tesla Stock Forecast $700 remains the key support and target for now. As long as this holds then, there is the chance of a strong bear market rally. But it likely is getting too close for comfort now and should be triggered today. That level most likely has stops just beneath, so it could spike lower on a beak. That would then be the time to reassess. Both the Money Flow Index (MFI) and the Relative Strength Index (RSI) are close to oversold, and a break of $700 could put both into oversold territory. Breaking $700 brings $620 as the next support. Resistance and the bullish pivot is all the way up at $945 now. Read next: Where XRP price could bottom and how to reenter the market| FXMAG.COM Tesla (TSLA) chart, daily
What is next turn for (TSLA) Tesla? Elon Musk-Twitter Interacting With Tesla Stock Price | FxPro

What is next turn for (TSLA) Tesla? Elon Musk-Twitter Interacting With Tesla Stock Price | FxPro

Alex Kuptsikevich Alex Kuptsikevich 19.05.2022 15:45
Tesla stock has always been more volatile than the stock market. It closed the Thursday session on the lowest level since last August, and it is a common question, what is the next turn for the leading EV producer. For now, it looks like the downside impulse is not over yet but did its main part. Musk’s deal with Twitter The list of variables in this stock ranks from the outlook for demand for electric cars (i.e., oil prices) and interest in the ESG agenda, including the economic outlook and monetary policy, and ends with the tone of the tweets of its founder, Elon Musk. But in recent days, it has also been affected by Musk’s deal with Twitter, where Tesla shares were used as collateral. For investors, the latest news of Musk’s potential break-up of the agreement to buy the social network is good news. The opposite is also true. The promotion of the deal has caused Tesla shares to sell off with acceleration in the market. Read next: Altcoins: What Is Polkadot (DOT)? Cross-Chain Transfers Of Any Type Of Asset Or Data. A Deeper Look Into Polkadot Protocol | FXMAG.COM Locally, buyers are eyeing current levels to purchase Tesla Shares in the leading electric car maker are now trading 38% below their peaks at the start of April and 43% below their all-time highs in November last year. The company’s shares are looking better than many other pandemic favourites, which have zeroed in on all and much of the gains from the March 2020 lows, while Tesla has become about ten times more expensive in that time. Read next: Altcoins: What Is Monero? Explaining XMR. Untraceable Cryptocurrency!? | FXMAG.COM Locally, buyers are eyeing current levels to purchase Tesla, which is aggressively ramping up production and is well ahead of other electric car makers in sales in an era of record fuel prices. On the one hand, the technical analysis points to a return of the stock from oversold territory, which could be followed by both a recovery bounce and the start of a new wave of growth that could return the price to levels above $1000 in just a few weeks. On the other hand, the share price may not face much of an obstacle moving down another 10% from current levels, regaining half of the pandemic rally to levels near $650, where it has traded repeatedly since December 2020.
Surprise OPEC decision could be a turning point for oil! | MarketTalk: What’s up today? | Swissquote

Tough day for retailers and Tesla in the US, and Tencent broadens the rout in Asia | Saxo Bank

Saxo Bank Saxo Bank 19.05.2022 08:15
Summary:  Asian markets joined the overnight selloff in US equities although some reversals were seen subsequently. Risk sentiment saw a mild recovery but the outlook for consumer discretionary remains murky amid rising cost pressures and inventory building. Australia’s unemployment rate dipped to record lows and watch for Japan’s CPI and China’s loan prime rates due on Friday. What’s happening in markets? Wall Street stocks hit new lows as the market anticipates earnings declines and further slowdowns in consumer spending, amid tighter financial conditions. This is what’s dragging tech and consumer spending stocks (ex-reopening stocks) to new lows. The S&P500 fell 4% on Wednesday, eroding most of its recent gains. The Nasdaq fell 4.7%, taking the top 100 stock index to its lowest level since November 2020. We think the market is not yet at capitulation point - further selling is ahead. The extra risk now is that volatility, is causing boutique investment managers to be on the brink of margin collapse, which could add to further selling pressure in markets and stocks that are down heavily. Asian equity markets join the global sell-off. Japan’s Nikkei (NI225.I) was down over 2.5% led by tech such as Tokyo Electron (8035) and consumer discretionary with Fast Retailing (9983) down over 3%. Singapore’s STI index (ES3) also dropped close to 1% on Thursday morning after Singapore Airlines reported earnings with a narrower loss and an upbeat outlook. Hong Kong and mainland China equity markets gapped down but losses narrowed at mid-day.  Following overnight US equity market’s worst sell-off since June 2020, Hang Seng Index (HSI.I) slumped as much as 3.5% in the morning. Tencent’s (00700) over 8% plunge in share price after reporting Q1 results below market expectations dampened sentiment further. Tencent’s Q1 revenues and EPS coming at flat and -23% YoY respectively and both were 4% below consensus estimates. Online games revenues (PC + mobile) declined 2% YoY and online advertising revenue dropped 18% YoY. Investors were also troubled the management’s remarks saying support initiatives from the Chinese Government to the tech industry takes time and will not benefit the Company much in near-term.  By mid-day, Tencent is down 6.6% and Hang Seng Tech Index (HSTECH.I) is down 3%.  Hang Seng Index and CSI300 (00300.I) fell 2% and 0.3% respectively. Tesla (TSLA) shares slide 7%, more selling to come as S&P500 boots it out of ESG Index, at a time when market anticipates earnings growth to fall and costs to rise. S&P explained why it kicked Tesla out of its ESG index saying Tesla’s “lack of a low-carbon strategy” and “codes of business conduct,” along with racism and poor working conditions reported at Tesla’s factory in Fremont, California, affected the score. Separately, new research suggests battery cell prices will surge 22% from 2023 to 2026 amid the scarcity in raw materials needed to make EV batteries. This is why we continue to advocate that clients would be better served in commodity companies who are benefiting from price inflation, rather than commodity consumers (EV makers). Read next: Altcoins: What Is Litecoin (LTC)? A Deeper Look Into The Litecoin Platform| FXMAG.COM Cisco (CSCO) – a proxy for business IT spending, guides for weaker earnings. Cisco is of the largest IT and networking businesses in the world (catering to a 1/3 the world’s market). It reported its Euro and Asian sales fell 6%. But the real story is its weak guidance. Cisco CEO guided for a drop in revenue ahead, expecting a 1-5% revenue decline for Q4, at a time when the market expected revenue growth of over 5%. This reflects that businesses are not willing to open up their pockets, at a time when inflation (wages, energy) is rising and interest rates are going higher. Consumer spending retail proxies hugely disappoint - as their profit outlooks dim. Target (TGT) shares fell 25% (biggest drop since Black Monday). Walmart (WMT) fell almost 8% as both retailers cut their forecasts for profit amid a slowdown in home-good sales at a time when they’re guiding for rising costs pressures (fuel, freight costs, rising wages). Target and Walmart make $600 billion in combined revenue, that’s double the size of the biggest company on the ASX. So given that both the retail giants are proxies for consumer spending, their demise could translate to other companies. What to consider? US retailer earnings signal shifting consumer spending patterns. We have seen a number of weak retailer/ecommerce earnings from the US now starting with Amazon (AMZN) to Walmart (WMT) to Target (TGT) reporting a 52% decline in profits overnight. While US retail sales show that the consumer is still resilient, there is certainly a shift in spending patterns away from home appliances that were the most sought after during the pandemic to reopening and travel related items such as luggage and services. But it is also important to note that inventory levels are building up, which may mean more write downs or a mark down in prices to sell off. Higher costs are also weighing and only likely to get worse in the second quarter. This means retailers will continue to face the brunt for now. Offshore investors were net seller in onshore RMB bonds for the 3rd consecutive month.  In April, foreign investors sold RMB88 billion (USD13.3bn equivalent) worth of onshore RMB bonds.  The amount of selling moderated somewhat from March’s RMB98 billion. Net inflow of foreign currency from China’s trade settlement declined. In April, net trade settlement was only 42% of China’s trade surplus of that month, below the 2021 average of 58%.  The key driver for the low net inflows seems coming from higher than usual demand from importers to buy foreign currencies, staying at escalated level of 65.1% in April versus 2021 average of 55.8%.  Exporters repatriated 60.8% of the total goods exports in April.  It was down from March’s 65.8% but still well above 2021 average of 54.6%.  Dollar trimmed gains in Asia. The USD moved higher as risk sentiment was eroded overnight, but trimmed gains in Asia. GBPUSD rose back towards 1.2400 while EURUSD was seen back above 1.0500. UK inflation shot up to 9% y/y in April from 7% previously, continuing to complicate the task for the BOE. Yen weakened in Asia, but the cap in 10-year yields as equities lose momentum is suggesting yen weakness has mostly run its course, at least on the crosses. Read next: Altcoins: What Is Monero? Explaining XMR. Untraceable Cryptocurrency!? | FXMAG.COM AUDUSD rises 0.9%, off its low as Australian unemployment fell to a new historical monthly low (3.9%). This is the lowest reading for the survey. Unemployment was lower in 1974 when survey was quarterly. However, the AUD rose modestly off low, up 0.9% today to 0.7020, as the strong employment data gives the RBA more ammunition to raise rates - given Australia’s economy strengthened. China’s reopening theme also adds to upside for the AUD. However, longer term, as the Fed raises rates, this strengthens the USD, will likely cut the AUD’s grass. Japan imports swell on energy and weak yen. April trade deficit was seen at 839 billion yen as exports grew 12.5% y/y but imports rising 28% on higher energy prices and the drop in yen to two decade lows. Following a negative GDP print for Q1 reported yesterday, the impeding trade position is adding to Q2 risks and pent up demand remains the key to provide an offset in order to avoid a technical recession. Rising inflationary environment may however weigh on consumer spending and Japan’s April CPI will be on watch tomorrow. Consensus expects a rise to 2.5% y/y from 1.2% in March with core CPI also turning positive at 0.7% from -0.7% previously. Potential trading ideas to consider? Short CNHJPY trade that we put on last month may still have room to go. The larger foreign currency outflows due to offshore investors’ bond selling and smaller inflow of foreign currency from trade settlement tend to give add to the depreciating pressure the renminbi. At the same time, the Japanese Yen is benefiting from a safe haven bid in the midst of global equity sell-offs.  Both Japanese investors and overseas leveraged investors who fund their positions in Yen tend to repatriate and need to buy Yen in the time of turmoil.  In addition, the prospect of a pickup in inflation in Japan may trigger traders to cover their bearish positions in the Japanese Yen.  Asian retailers likely to see pressure from global counterparts. Consumer discretionary sector was leading the decline in the S&P overnight, and the rout is likely to spread to Asia. Watching key Asian retailer shares like Japan’s Fast Retailing (9983), Hong Kong’s Sun Art Retail (6808) and Australia’s Harvey Norman (HVN). With liquidity conditions only starting to tighten, there is likely room for the equity rout to run further, but cash is not a viable asset for long term investors. We remain overweight commodities and reopening.   Key economic releases this week: Friday: Japan nationwide CPI, China loan prime rates   Key earnings release this week: Thursday: Xiaomi, Generali, National Grid, Applied Materials, Palo Alto Networks, Ross Stores, DiDi Global   For a global look at markets – tune into our Podcast. 
Could XAU extend rally? Are Apple, Tesla good to short? | MarketTalk: What’s up today? | Swissquote

Could XAU extend rally? Are Apple, Tesla good to short? | MarketTalk: What’s up today? | Swissquote

Swissquote Bank Swissquote Bank 20.05.2022 10:23
The US equities closed Thursday’s session in the negative following a choppy trading session, as investors’ hearts pounded between buying the dip, or selling further on recession fear. The US 10-year yield declined yesterday, and the sharp retreat in the US yields gave a boost to gold, raising question on whether the gold rally could be sustained, and if yes, how high could it extend. The dollar gave back gains, letting the EURUSD and GBPUSD rally, but the gains may remain short-lived if the dollar skew in market pricing continues. Tesla got kicked out of the S&P’s ESG index, which could have implications on its long-term price potential   On the individual stocks, news that Michal Burry opened a bet against Apple heated conversations about whether Apple is a good ‘short’. And finally, Tesla got kicked out of the S&P’s ESG index, which could have implications on its long-term price potential. Read next: Altcoins: What Is PancakeSwap (CAKE)? A Deeper Look Into The PancakeSwap Platform| FXMAG.COM Watch the full episode to find out more! 0:00 Intro 0:28 Market update 1:20 Is Apple a good stock to short? 3:50 US yields boosted gold. Is gold rally sustainable? 6:25 FX update: euro, pound up on softer dollar 7:58 Tesla out of S&P ESG index: what does it mean for stock performance? Ipek Ozkardeskaya Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020. Follow FXMAG.COM on Google News
Podcast: Commodities rout points to recession fears

Elon Musk Firing People!? Will (TSLA) Tesla Stock Price Plunge!? | FXStreet

FXStreet News FXStreet News 21.06.2022 16:34
TSLA stock is up 3% to $670 in Tuesday's premarket. Musk announces plan to cut 3% to 3.5% of total headcount. Tesla being sued for recent mass layoffs in US. Tesla (TSLA) CEO Elon Musk announced at the Qatar Economic Forum on Tuesday morning that his market-leading EV manufacturer was planning to lay off as much as 3.5% of its workforce immediately, including 10% of salaried workers. This is actually a reduction in scope by Musk, who said earlier in June that he had a "super bad feeling" about the economy not long after JPMorgan CEO Jamie Dimon said a "hurricane" was on its way toward the US economy. At that time an internal memo from Musk called for a 10% reduction in headcount. TSLA stock is up 3% to $670 in Tuesday's premarket on the news. Tesla Stock News: Layoffs appear short-lived At the Qatar forum in an interview with Bloomberg's News' Editor-in-Chief John Micklethwait, Elon Musk said the 10% of job cuts were meant only for salaried workers, as opposed to hourly manufacturing workers, because the salaried workforce had grown too quickly. “A year from now, I think our headcount will be higher," Musk added. Tesla, headquartered in Austin, Texas, now has around 100,000 employees, so this would mean that approximately 3,000 to 4,000 employees would be terminated overall. The company is already facing lawsuits for terminating 500 employees at its Nevada gigafactory earlier this month. Two employees, John Lynch and Daxton Hartsfield, have brought suit, arguing that Musk's company violated the 60-day notification period required for mass layoffs under the Worker Adjustment & Retraining Notification Act. "It's pretty shocking that Tesla would just blatantly violate federal labor law by laying off so many workers without providing the required notice," said attorney for the workers Shannon Liss-Riordan in an interview with Reuters. Musk downplayed the lawsuit when asked about it in Qatar, calling it "trivial". It is uncertain how, if at all, these layoffs would affect overseas workers. Tesla's gigafactory in Shanghai has only just gotten back in gear with exports resuming in May. Tesla exported over 22,000 vehicles from its Chinese factory in May after covid lockdowns in March and April forced it to only export 60 units. News from its factory outside Berlin is that the EV maker is being forced to raise salaries to attract talent from other automakers. Birgit Dietze, a representative for the IG Metall regional union, said that Tesla's hiring is behind schedule as it plans to hire 12,000 employees by the end of the year. This has forced Tesla to raise starting salaries by as much as 20% in order to reach hiring goals. Dietze said this will difference in pay between early hire and late hires will cause consternation at upcoming collective bargaining talks. Tesla Stock Forecast: $700 is the barrier to beat With TSLA shares rising as Elon Musk seeks to control costs, $620 remains the key support for now. Its strength comes from February 24's steep loss that held up there, but it also worked back in August 2021. Breaking through $700 turns this resistance level back into support and places TSLA stock back in neutral territory. The 20-day moving average sits nearby $700 and should also provide some resistance. If Tesla stock fails to conquer $700, then shares will likely descend back to support at $620. From there, based on the descending lower trend line, TSLA is destined for either $600 or more likely $550. That last price held strong in March and May of 2021. It is important to remember that the 20-day is way below the 50-day moving average, and that means TSLA share price is definitely still in a downtrend. Do not expect it to end until Tesla breaks and holds $700 for at least a week. Above $700 lies further resistance at $756. Breaking through the last swing high close of $775 and closing above it will spell a new bull market for the EV leader. Tesla stock daily chart