Daily Market News - 28th July 2022
Are Stocks Bottoming?
What a month.
The S&P is +11% from its lows and the QQQ’s are +14%.
If you’ve picked up my bullish charts over the last month, congrats, you’ve probably done alright.
We have the Fed out the way, 75bps was widely expected and that’s what we got. The real question is, how will that affect the market?
In this weeks letter I’m going to lay out a few more charts I’m watching closely.
Disclaimer: I’m not over thinking the index levels - stocks will bottom long before you see it at the index level and before the mainstream donkeys at CNBC / Bloomberg start reporting it. I also advocate a disciplined risk management process.
Lets get into a few charts.
Steel Index (SLX)
This is a chart from our Members Sector ETF Chartbook. (our members have access to all my ETF Charts)
2 yrs ago I made a bullish call on steel and to my surprise, it moved just as well as Growth Tech with some massive moves, I like to pay attention to failed moves because oftentimes we get fast moves going in the opposite direction.
This is a Weekly Chart so nothing is confirmed, there’s still time for this to fall away from current levels, but over the next 2 days, this chart could get interesting.
How about stocks that’ve been beaten to death?
PayPal (PYPL)
Not many of us time stamp our work, but this is a chart sent to our clients/members 2 weeks ago highlighting the potential for a bullish move in a beaten up stock like PayPal which is +16% and has now moved above the 50 Day Simple Moving Average and now we see how far it wants to go with a disciplined risk management process.
How about Elon over at Tesla?
Tesla (TSLA)
It’s been choppy, but it’s going up, funny how that happens huh… I put the chart out a couple of weeks ago and on the back of earnings it looks to have caught a bid. And lets be honest about it, if you’re short TSLA or you’re a firm advocating being short TSLA, you probably deserve it at this point. (Insert any Homer Simpson DOH joke)
Lets not lose sight of the bigger picture though.
Yield Curve
We’re probably heading for a recession (if we’re not already in 1).
Earnings are getting worse. How do stocks perform in that environment? What’s the US Dollar going to do?
So many un-answered questions.
If you missed my last social media analysis, feel free to check that out below.
Our Time Stamped Market Calls