TG Watkins – Markets Lose Momentum, Opportunities In Interest Rate Sensitive Sectors
TG Watkins, Director of Stocks at Simpler Trading and Editor of The Profit Pilot Website joins me to outline the opportunities he is seeing for longer term investors in this market environment where upside momentum has been lost.
We start with the recent momentum shifts in the S&P and NASDAQ, the performance of interest rate-sensitive sectors like small caps and regional banks, and the outlook for precious metals and ETFs such as GDX. TG shares his thoughts on potential Federal Reserve interest rate cuts, summer trading patterns, and the broader market environment as we approach the Fourth of July and the end of the year. Right now he is looking at the regional banks and small caps as having a potentially very bullish set up for when the Fed actually starts cutting rates.
Additionally, TG offers insights into the current 30% discount available at Simpler Trading.
IPT finished at a declining fork support that it last hit over 2 months ago. An important difference between the two hits is that the first one happened on 15 times the volume of today’s move.
https://stockcharts.com/h-sc/ui?s=IPT.V&p=D&yr=2&mn=3&dy=0&id=p94806802781&a=1443777374
Moxie triggered a buy on weekly IPT in March and still very much bullish looking structure. I may buy some.
I posted this chart of Tesla on Sunday and it’s been an absolute blast. Tesla will soon reclaim a spot in the trillion dollar club.
https://stockcharts.com/h-sc/ui?s=TSLA&p=M&yr=6&mn=0&dy=0&id=p01615760064&a=1708290247&r=1719937760367&cmd=print
Nvidia dropped $40 billion today and Tesla added 66 billion. It looks like a lot of tech investors sold one and bought the other. Two stocks changing over $100 billion in valuation today. This market is gyrating in a few stocks that could take the whole enchilada over the cliff. Those are crazy numbers. LOL! DT
Yes IPT remains bullish and has closed lower for the last 6 weeks as volume collapsed. All good. Still, it might be the week after next before it and the sector get going to the upside with conviction.
https://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=5&mn=11&dy=0&id=p61242894160&a=1690043196
That would be a good contrarian move to take some of that bloated tech money and drop it into a silver producer like IPT, or SCZ. One hundred shares of TSLA will buy you 100,000 shares of IPT, that would be a real smart move. It won’t take much tech money to drive the silver market crazy. DT
As always DYODD!
I want to see how Tesla acts as it nears 270.
https://stockcharts.com/h-sc/ui?s=TSLA&p=W&yr=5&mn=0&dy=0&id=p15799522120&a=1272511077
250 looks important but is it?
https://stockcharts.com/h-sc/ui?s=TSLA&p=W&yr=3&mn=11&dy=0&id=p68915650317&a=1716139328
No Nvidia in Your Portfolio? ‘You’re Just Toast’
The average stock in the S&P 500 is lagging behind the index by most since at least 1990
Charley Grant – Wall Street Journal – July 1, 2024
“In this year’s bull market, there are artificial-intelligence plays like Nvidia NVDA -0.96%decrease; red down pointing triangle—and then there’s everything else. As the second half of the year begins, investors are wondering whether something has to give.”
“Enthusiasm for the chip maker, whose products are seen as essential to powering AI technology, kept building through the second quarter. Nvidia reported sales and profits in May that blew past Wall Street expectations for the fifth consecutive quarter. The stock rose 37% in the second quarter and is up 149% for the year.”
“Much of the rest of the index has languished. The average stock within the S&P 500 is up 4.1% this year, while the broad index is up 14.5%. That is the largest underperformance since at least 1990, according to Dow Jones Market Data. Six of the 11 sectors in the index declined in the second quarter, including financials, energy and industrials.”
The divergence has some value investors throwing up their hands.
“We can’t keep up because we don’t own Nvidia,” said Max Wasserman, co-founder and senior portfolio manager at Miramar Capital. “If you don’t own that one stock, it really hurts. Every day feels like a root canal without novocaine.”
https://www.wsj.com/finance/stocks/no-nvidia-in-your-portfolio-youre-just-toast-1a166572
The herd of generalist investors all piled into Nvidia, better hope it just keeps surging higher to the moon, and doesn’t roll over and find gravity with a more reasonable valuation anytime soon.
If that were to happen, the headline could shift to “If You Own Nvidia In Your Portfolio You’re Just Toast.”
It’s not just them all investors will feel the undertow, the whole market is listing on one side and when they try to right the rowboat in the middle of the Atlantic it will sink fast. DT😜😏
The tooth is dead when you get a root canal so no need for novacaine
I just had a root canal, and they used plenty of novacaine, as you’d still feel the pain from removing the roots (nerves) without it. They also injected something up to into the space to help my tooth recalcify and grow, even though it is “dead” from a nerve standpoint now. There are still nerves around the gums and tooth that also remain sensitive.
So that line from the article makes sense: “Every day feels like a root canal without novocaine.”
I had a molar done in 1967. Dentist insisted the tooth was dead and no freezing necessary. Frontier dentistry back in the old days in northern Canada.
Irving Kahn a Wall Street trader said in 1928, ” Most of the time people are Greedy”! If you didn’t have greed, you wouldn’t have a stock market.
After The Market Crash in 1929 he said, “The Two things that define humans are Folly and Greed verses Reasoning and Restraint.”
In 1932 a lot of laws had been enacted to protect the economy, they have since been cancelled because Greed is the strongest of human emotions and the rulers have short memories because they know the public has forgotten real hard times and greed has them motivated. DT