Good morning and happy month!
At the beginning of every month we have a wave of reports happening, and this week is no different. Watch for Wednesday Fed meeting, Thursday OPEC meetings and Friday’s jobs report. Today we have the Gabelli 45th Annual Automotive Aftermarket Symposium, which affects the EV sector, and it can lead in swings in prices in these stocks. Therefore watch closely the events of this week as they can be pivotal for the action in the next weeks. What’s my plan for today? Since there was no major sell off in to Friday I did not load up on any stocks, and tried to stay away from the Tech sector, after disappointing earnings in $AAPL and $AMZN, but I shifted towards $GOOGL and $MSFT. I am watching closely these two stocks to see if the money shifts towards them today. I am also watching the small caps, the $IWM, since it has been fickle and unable to get out of this long year channel. I am not jumping into anything major until I can see Wednesday’s FOMC language and trying to stay tactical, rather than over-invested. On another (cyrpto) note: I hope you bought $MANAUSD on Friday, as it is a key beneficiary of the Meta story, as it went as high as $5, trim some and keep some.
The tech sector index has made a new all time high on Friday, at $386.28, being pushed up by $GOOGL and $MSFT which showed impressive strength, especially the latter which also made another ATH itself. It also helped that $AAPL went on a rally itself, to recover from the depth dug by its earnings report. This whole move in tech showed that this sector is healthy and strong, but for this week the FOMC is pivotal, because inflation and tapering can hit it strong and fast. Today it would be impressive for the $QQQ to hold $382.78 and consolidate around there. Be tactical and careful and seek Friday’s winners for some cash flow.
After Thursday’s impressive green candle on Friday the small caps took a break and managed to keep the upper half of the flag, but without much gas and force. I tentatively bought some long term calls for January, since it can offer me some more time for this sector to get out of its channel, and if there is a period in which it should do it, this is it. Watch $230.72 today, if it reaches this number and it pushes higher we could finally say that the $IWM is in play.
I told you that today we have a symposium on the automotive market and that electric vehicles will be the talk of the day. I bought a bit of $QS on Friday as its batteries showed to be promising, and it has announced another potential investor, aside from Volkswagen, all the odds are in its favor. It made an impressive move on Friday going over all the moving averages. Watch $27 as a support, and it would be even more spectacular if it could manage to hold above the 200 day EMA $28.66.
The COP26 kicks off today and clean energy will be loud on every media outlet. I did not get overly invested in clean energy on Friday, since so many times it is a sell the news kind of thing, but I chose a small player like $QS, which has been an underdog for a long time, and Friday it finally woke up. You have $TSLA as the clearest winner of last week, see if it has reached its top, or if there is any battery left in it. This is a week driven by macro news and staying tactical can be key for keeping capital intact. Keep your eyes and ears wide open because all of these catalysts are pivotal in the shaping of this week’s tape.