With all the talk of commodities lately, let’s not forget Growth/Tech
The inflation trades were due for an oversold bounce (at least). But before I started buying back some commodity related stuff and in line with the drop in inflation expectations and hence, yields, I added some Goldilocks items (Tech/Growth) and others that tend to do better when yields are easing (e.g. Biotech).
Here are a few charts of items I currently hold (until tomorrow or next year, depending on the market view) sporting some nice bottom/potential bottom situations. Unlike commodities, which I’ve bought because of a horrible tank job to support but few other chart-based reasons, these former darlings are grinding out bottoming situations after casino patrons took the Fed seriously and got the hell out of Dodge.
As a side note, there are plenty more situations and charts like these out there. It’s not like this is anything but a list of the ones I chose to add. You can and should have your own if you think that the bounce can continue and wish to speculate on it.
ZM has formed a nice pattern and held the SMA 50 after its massively overdone investor sponsorship ran for the hills. RSI and MACD are green and while it’s still not a ‘value’, it’s ridiculous valuation of yore has been fixed.
CRM is in a funky grind, not a clear bottoming pattern. But it was added for its less overvalued status to see if it can hammer out a pattern. What’s forming here would also be consistent with a ‘continuation’ pattern and with the trend down that means it could theoretically continue down. So I am keeping an eye on it.
I am in BABA for a second time after a successful first buy/sell. It was first bought in May not for the chart but instead for a personal ‘I think it’s been clubbed enough’ sentiment. It was. Now it’s also got a pattern; a basing one. Large Chinese stocks went into bear markets well before the US headline indexes did. Who’s to say they can’t lead the way out well ahead of time?
DVAX is actually not a darling of Wall Street. Not that I have been able to pick up on. Indeed, most entities that tout it do so for the COVID-19 adjuvant. But I own this Hepatitis (B) vaccine maker for the execution of its market opportunity in Hep. Chart wise, it was bought on the June drop to the SMA 50 and since then the chart says ‘so far, so good’ and the break above the SMA 200 may even hint at a future try at the gap around 21. Ya never know.
Finally, in a decision between Biotech-related story stock CRSP and Biotech-related story stock TWST, I went with the latter. It completed a successful test of the SMA 50. It’s already tacked on 19.5% after being added less than a week ago.
A few other household names were added as well after casino patrons stampeded out of them, but they do not have chart patterns like the above. As with commodities, they tend to have declines to support areas.
With the S&P 500 not having reached my minimum downside target of 3200-3400 I’ll be aware this is probably a bear market rally, but I think it’s got a chance to be a strong one. Also, I was being miserly in 2020 waiting for a clear support level in SPX before committing to buy heavily. It never came. The damn thing bottomed higher. So, lesson learned there too. Lessons, baby. That’s what this racket is all about.
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