GWO Daily Note 11/7/2019
Market Strategies Newsletter - Special Daily Edition
For Trading November 8th
TRAVEL SITES DESSIMATED
DIS and RL Beat
Bonds Cascade Lower
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Today’s market was all about the Chinese, AGAIN. Really, how many times can we rally on exactly the same news? It just amazes me that Mr. Trump can orchestrate the market on a day by day basis. Not to put sharp an edge on it, we have had 3 unfilled upside gaps in the last 21 trading days. Any “technician” will tell you this is not a good thing. So, we started up and unlike the last few days we didn’t make the high in the first half hour, it took until 12:15 to hit +282 before moving sideways until 2:30 before falling a bit to +137 and closing +182.24 (.66%), NASDAQ +23.89 (.28%), S&P 500 +8.40 (.27%), the Russell +4.45 (.28%) and the DJ Transports +61.33 (.56%), but on the low of the day. If I hear one more IDIOT talking head tell me that the Transports made a new all-time high, confirming the “Dow Theory buy signal I’ll have to shot my TV screen. The DJT HAS NOT made a new high, it has made a 52-week high but still it over 500 points below the high of 9/14/2018 at 11,623.58, 532.21 or 4.6%. Today it was someone I used to respect, Jeffrey Saut, who really should know better. Today’s market was a study in DJIA gainers outweighing the rest of the market. In case you didn’t notice in the numbers above, the DJIA was up 2.5 times the Naz and S&P. There were 22 up and 8 down but the gains were in the same old names, UNH +40, BA +35, GS +33, AAPL +20 and CVX +15 DP’s. No double-digit losers. Market internals were negative again on NYSE 13:16 and NAZ barely 1:1. If DIS holds on to its current gains (+9) it will add about 55 DPs. The stock broke out in April and flew up to $147 before coming back down a bit to close $132.96 but is $140.27.
Our “open forum” on Discord, which allows me to interact with subscribers and others to allow direct questions and chart opinions on just about any stock, continues to grow with more participants every day. It is informative and allows me to share insights as the market is open and moving. The link is:https://discord.gg/ATvC7YZ and I will be there and active from before the open and all day. It’s a great place to share ideas and gain some insights.
SECTORS: Other names in the news: As the earnings parade continues our position in CTL was a major beneficiary of a good number after Guggenheim downgraded it yesterday lowering its price target from $15 to $10. OOPS, it reported good revenues and the stock took off trading from yesterdays $13.07 after the cut, to a high today of $15.05 and closing $14.88 + 1.52 (11.38%). We had taken a 100% gain on the first half of the trade and took 300% today on the balance. I’ll roll forward and up on any pullback.
Last night I mentioned ROKU fell to $117.56 and is trading $120.22 -20.83 (14.2%) on their subscriber miss, and this morning it traded to $116.26 before finding a footing and coming back to 128, but couldn’t hold it and finished the day near the lows at $118.46 -22.59 (16%). EXPE also missed and after closing $135.36 it too fell hard, trading 116.65 and finished 117.88 – 17.78. But today it too only got worse finally cracking $100 and closing $98.29 -37.07 (27.39%). Its relative, TRIP also suffered a setback finishing $31.65 -9.14 (22.41%) and BKNG also fell to $1849.93 -162.12 (8%), but then reported a beat after the close and after falling to $1769, recovered to finish the evening $1946.57. BTW, the 15-minute range line was an amazing 1769 to 1973, and no, those are not dates, they’re dollars. The booking sites were negatively affected by the GOOGLE re-jig of their ALGO to put only paid sites on the top page and these guys suffered with dramatic increases in ad-spend that killed margins.
Two on the upside were DexCom: DXCM beat on earnings and had a slight miss on revs, but gave sterling guidance. Just about everyone covering it upgraded price objectives. It finished $194.70 +41.58 (27.16%). RL beat, sort of, and remarkably, although they have been beset by the same tariff issues and problems in HK and currencies, they INCREASED margins through price increases. The stock finished the day $115.67 +14.79 (14.66%) and has recovered from a low of $88.02 just last month. Unfortunately, it wasn’t good news for the Gap: GPS, who lost another CEO, Art Peck. The position will be taken in the short term by another member of the Fisher, Robert. After the loss through a disagreement with Mickey Drexler, the real force behind the spectacular rise of the brand, there have been many public problems. The company was to split off and take public Old Navy next year. The stock, at its peak was $53.75 in 2000, fell to $9 in 2003, back to $43 in 2014 and fell from a high earlier this year of $31.39 to close today $18.06 +.33. After the news it traded to $15.87 and is currently 17.11. And last, a name I gave you last year at the beginning of the Fortnight craze: Turtle Beach: HEAR, who made headphones for gaming. The stock rose from a 1:4 split adjusted $1.64 to $34.50 in 4 months. It closed today $10.00 -1.03 before the news and afterwards fell to $8.35, a new YTD low and is currently $8.90 -1.10.
BIO/PHARMA:stocks wereHIGHERwith ICPT the big winner + 4.83 (6.10%) and TEVA +.36 (4.44%). The rest were + or – less than 1% with IBB $108.57 +.26 (.24%).
CANNABIS:stocks wereLOWERagain with CRON -.37 (4.44%), PYX -.43 (4.14%), APHA -.16 (3.23%) with KERN a big winner +.33 (7.95%). MJ was $18.82 -.43 (2.23%).
DEFENSE:wasMIXED with no gainers or losers over 1%. ITA was $226.62 +1.36 (.60%). +.43%).
RETAILwasHIGHERwith RL (see above) the leader +15.10 (14.97%) and KSS +2.21 (4.06%). UAA fell again -.49 (2.7%) and the XRT was $44.70 - .06 (.13%).
FAANG and Big Cap:were HIGHERwith the big surprise a major beat by BIDU. Even though numbers were down, they were better than expected and revenues solidly beat. The stock has been down all year, falling from $284 last spring to close yesterday $104.64. In late trading yesterday it was +$5 but it continued to get a few upgrades and new price objectives that drove it to $121.87 +14.51 (13.52%). Dis (see above) also put on a spectacular show tonight. XLK was $85.64 +.67 (.79%).
FINANCIALS wereHIGHERwith rates gaining and GS +5.27, JPM =.95, BAC +.45, MS +.14, C +1.43, PNC +1.36, AIG -.12, TRV +.66, AXP +1.66 and XLF $29.85 +.22 (.74%).
OIL, $57.15 +.80. Today’s action was an inside day and another try at the overhead supply trading to a new recent high at $57.85 before coming back to the upside to close nearer the highs. The narrative seemed to change overnight (not literally) to “signs of strength in Europe and more demand. The stocks were higher with the XLE finishing $60.94 +.90 (1.5%).
Prices for Natural gas were lower today and closed $2.772 - .056 and have come close to closing the gap left above 2.748. We have already tested support on the bounce from 2.40 and we have rallied to hit just under $2.90 and if we close that gap I think we can work higher.
METALS,GOLD: $1,466.40 -26.70,yesterday’s advance was stopped at resistance at $1,495 and we should have sold our position early this morning. Today’s failure to follow higher and finish down on the day was a good reason to flee, but we also broke thru the bottom Bollinger Band and Gold rarely stays there very long.
BITCOIN: closed $9,220 - 140.We broke to the downside recently but turned sharply higher recovering over $2,655 since breaking $7,500. After the rally to just over $10,000 we have been flagging out in a bullish manner and today’s close is within an acceptable range for me. I expect this to continue. Today’s range did nothing to change my opinion. A close above $9,565 is need to send us higher. We were stopped out of the GBTC position and I bought back 350 of the 750 I want to own @ $9.45, keying off the 200-day MA down at $8.70.and we rallied and with a low of 9.25 and a high of $10.28, I added another 400 GBTC at $9.83, and they closed $1110.88 -.32.
Tomorrow is another day.
CAM
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