S&P futures are trading around the unchanged mark as traders wait for jobless claim data. Tech stocks are once again gapping higher as investors rush into the sector in a FOMO type trade. Since the start of the quarter, there has been a surge in stocks like TSLA, AMZN, NVDA, SQ and countless others. The question is not if these stocks will find gravity, rather it’s a matter of when and what the catalyst will be. The rise of COVID-19 case does not phase the Nasdaq stocks, but they will have to face earnings season in the coming weeks. The[…]
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Buy Low, Sell High
The US’s “V-shape” recovery appears to have come to a pause as daily COVID-19 cases surge, and states begin to roll back reopening. The bulls and the bears are duking it out between S&P 500’s 3,000 and 3,200. Overzealous investors and analysts are driving the equity market rally. Analysts are continually upgrading their price targets as the best-positioned tech stocks hit higher highs seemingly daily. Is their backing to these upgrades, or is it just because these stocks keep blowing past these analysts’ old targets? Buying low and selling high is the idiom of every investor, but what are we[…]
Read more5 Years Of Digitalization In 5 Months
2020 has been a year that will go down in the history books as the year a virus broke the global economy. But something else happened that the world did not expect: prolific digitalization. We have condensed what seems like 5 years of digitalization into only 5 months. Society has been forced to leverage innovative technology to keep businesses operating with cloud computing on platforms like Microsoft’s best-in-class Azure (MSFT). We have turned towards e-commerce giant Amazon (AMZN) to satisfy our shopping needs & wants with brick-and-mortar retailers no longer deemed as “safe”. Video communication has become a primary source[…]
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The Markets Can Remain Irrational Longer Than You Can Remain Solvent
I am starting to get straight-up bearish on the broader market. I know I have been skeptical of the stock market recovery since it began, but the recent surge in COVID cases and a flatlining in economic activity gives my current skepticism backing. The only thing holding up the equity markets at these seemingly unsustainable levels is the hope of another fiscal stimulus package, vaccine/treatment optimism, and a phrase that I’m sure we have all heard enough of: “don’t fight the Fed.” The market bulls and bears are fighting a battle between the S&P 500’s 3,150 and 3,000 levels, while[…]
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Futures Point to a Risk-Off Session
S&P futures are trading moderately lower after the European session saw some selling after yesterday’s rally. The weakness has less to do with virus fears and more with the Hong Kong situation. The new National Security Law that China has imposed on the city is leading to unrest. Additionally, we saw a reaction from the U.K. criticizing China, saying that the law is a “clear violation” of the autonomy of Hong Kong. The world is very upset at China at the moment. If there is joint economic action against the country, it could harm global trade. For that reason, the[…]
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Support Levels & Tech Stocks To Watch As The Market Rally Comes To An End
The market continues to break as another COVID outbreak appears to be running rampant in the US. Investors are worried a second wave now could cause sizable economic impediments and push back the timeline to economic recovery. The S&P 500 has come from over 3,200 in the second week of June to fighting a battle around 3,000, which is being supported by the 200-day moving average at 3,020 (which we bounced off this morning) and a Fibonacci retracement level which I have indicated below. Above is the S&P 500 I charted out utilizing TradingView’s trading tools. The blue circles represent strong support[…]
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The Tech Spread Continues to Expand: Should We Be Worried?
There has been an enormous divergence between US indexes amid one of the most tumultuous years in stock market history. In 2020, the tech-driven Nasdaq 100 has rallied 16%, while the S&P 500 is down over 3%, and value-driven Dow Industrial Average has lost 9%. According to a recent WSJ article, this is the most substantial Nasdaq advantage since 1983 (when tracking year-to-date performance to late June). Below is a YTD chart I created with TradingView charting tool, comparing the Nasdaq 100 (candlesticks), S&P 500 (red), and the Dow 30 (orange). Now the question we need to be posing to ourselves as investors[…]
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Futures Reverse Higher Overnight
S&P futures saw aggressive selling last night after White House adviser Navarro made comments on a Fox interview. When asked a long a detailed question about the China trade deal, Navarro simply said “It’s over” and then when on to criticize China. Markets initially took these words as an indication that the trade deal was in jeopardy and sold off. Futures were down over 1%, but the comments were walked back quickly and futures eventually bounced all the way back into the green. Positive June PMI data out of Europe has helped futures accelerate higher, which will help stocks open[…]
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2 Chinese Tech Stocks To Consider As US Rally Loses Steam
Tech stocks around the world have been rallying from the depths of pandemic trade with a ferocity that hasn’t been seen since the 90s. US tech firms look to be running out of steam, and it may be time to look overseas for opportunities. China equities may still have sizable upside potential for some of the best-positioned enterprises. This pandemic has increased the world’s reliance on technology, accentuating the already rapidly digitalizing Chinese economy. Below are 2 stocks that have been given a sizable pandemic tailwind with rallies that still have legs. My Chinese Picks: Alibaba (BABA) The fact that[…]
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Sea Limited (SE): Leading The Digital Revolution In Southeast Asia
Thus far, Sea Limited (SE) shares have exploded in 2020, illustrating astounding returns of 170%. This company has shown seemingly impossible growth figures, and investors are finally starting to see the extraordinary value in SE. Sea Limited is the leading internet company in Southeast Asia and Taiwan. These economies are digitalizing at an exponential rate, and Sea is well-positioned to take on the quickly expanding addressable market. The company operates two digital market-leading segments, including an e-commerce platform, and a digital entertainment division (Shopee and Garena, respectively). Pandemic Impact SE has weathered the coronavirus better than most global equities. The[…]
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