Hi all,

The markets had their worst week since September as the markets retraced the gains made on the post-election gap up. 

It was a week when investors and traders may have started considering the new administration’s agenda and became more concerned about potentially inflationary policies. The continued rise in treasury yields confirmed those concerns, as rates on the 2- and 10-year bonds continued to rise.

Fed Powell also threw some cold water on the market after his speech on Thursday, in which he said, “They would not be in a hurry to cut rates.” The chance of a rate cut in December dropped on that news, and the markets sold off Friday.

Watch for more downside and volatility next week, as we may see more selling early in the week. Investors will be all eyes and ears on the NVDA earnings call on Wednesday as they look for more encouraging news on the AI trade, which is still hot and may help to hold things up.

Cheers,

Brian

Recap Video

Watch the Recap on YouTube

Sectors in Play Last Week

• Financials and Energy were the only gainers this week.
• Healthcare and Technology were the worst-performing sectors this week.

Key Levels for this Week

• DOW (43,445) – support 43,300 and resistance 44,000
• QQQ (497) – support 485 and resistance 515
• SPY (586) – support 570 and resistance 600
• IWM (228) – support 226 and resistance 238

What to Watch for this Week

• Monday – 10:00 Home builder confidence
• Tuesday – 8:30 Housing starts and permits
• Wednesday – nada
• Thursday – 8:30 Jobless claims; 10:00 Existing Home sales and leading Economic Indicators
• Friday – 9:45 Services and Manufacturing PMI

Earnings this week

• Monday – nada
• Tues – WMT, WKHS, LOW, FUTU pre
• Wed – TGT, NIO, TJX pre and post PANW, SNOW, NVDA 4:20
• Thurs – BIDU, PDD pre, and ROSS post
• Friday – nada

Positions and Trades Last Week

• BABA – shorted as per last week’s plan but covered before the earnings report.
• HUT – long Bitcoin trade
• IBIT – long from last week’s watchlist.
• CRWD – Long under just $300 and got a nice breakout. Sold remainder last week as planned on pop that closed gap.
• TD – long now with the first round of calls expiring worthless – sold more upside calls.

Tracking for Potential Trades

• AMZN – breakout then pullback to breakout level. Support around $200 for a bounce back higher.
• DAVE – Good earnings – holding gap and might go higher.
• SQ – Getting ready for a potential long-term breakout higher through $85.
• UVXY – potential for a long on more selling early next week up to $25.
• XLU – long potential if yields start to drop more and break out through $80.
• XLV – long potential at $140 on this hard selloff for a reversal.

Note: These are investments I am in or watching however, they may not be suitable for all investors. The author of this email is NOT an investment advisory service, a registered investment advisor, or a broker-dealer and I do NOT undertake to advise clients or recipients of this email on which securities they should buy or sell for themselves. This email is provided for information purposes only and traders should always consult with their licensed financial and tax advisors to determine the suitability of any investment.