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Equity market gains have gathered momentum over the past week, posting strong gains and clearing key levels. The S&P 500 temporarily faced resistance at his 200-day line, but surpassed that critical level on Friday. A number of major stocks have flashed buy points.
X
Dow Jones futures open Sunday night, along with S&P 500 futures and Nasdaq futures. Over the weekend, Bitcoin continued its recent rapid rise.
Investors can gradually add exposure as the market rally improves. Many top stocks are currently being extended, Wendy’s (Wen), exxon mobil (XOM), Quanta Service (PWR), Celsius Holdings (CELH) and Inlet (PODD) are all executable from the initial entry. Wendy’s and PWR stocks have a new flat base, joining XOM’s stocks and Insulet. An additional week is required for the CELH strain to lay a proper foundation.
The CELH strain is on SwingTrader and IBD 50. Celsius, Insulet and Wendy’s are his three recent IBD Stock Of The Day selections.
in the meantime, Tesla (TSLA) on Friday announced significant price cuts in the US and Europe, a week after cutting prices in China and major Asian markets.
Tesla shares closed slightly lower, but rebounded strongly this week. But the EV giant is facing a painful shift as investors look to Tesla as an automaker rather than a tech company.
A video embedded in this article discusses a strong week in the market rally and analyzes WEN shares, Quanta Services and Celsius.
bitcoin price
Bitcoin’s price briefly climbed above $21,200 early on Saturday. The leading cryptocurrency is currently trading at around $20,900, up more than 10% from 24 hours ago. Bitcoin was trading just under $17,000 on January 8th.
Bitcoin’s rise coincides with a rise in the stock market that signals a return to more speculative investments. This includes growth stocks, especially speculative investments like his ARKK ETF. Some meme strains had a big week.especially Bed Bath & Beyond (BBBY). BBBY’s stock surged 179% despite the retailer’s indication that it was headed for bankruptcy.
dow jones futures today
Dow Jones futures open Sunday at 6:00 pm ET, along with S&P 500 and Nasdaq 100 futures.
U.S. stock and bond markets will be closed on Monday for the Martin Luther King Jr. holiday, but other exchanges around the world will remain open.
Note that overnight trading on Dow futures or elsewhere does not necessarily lead to actual trading on the next regular stock market session.
Join IBD experts analyzing viable stocks on IBD Live stock market rally
stock market rally
Equity markets had a strong week, with major indices closing near session highs.
The Dow Jones Industrial Average rose 2% in last week’s stock market trading. The S&P 500 index rose his 2.7%. The Nasdaq Composite rose 4.8%. Small-cap Russell 2000 is up 5.3% on him.
The 10-year Treasury yield fell 6 basis points to 3.51% despite Friday’s rally. The market has high hopes for his Fed rate hike of 1/4 of a percentage point in February and March, but has since been put on hold by policy makers. Lower government bond yields and brighter economic prospects elsewhere are weighing on the dollar, giving stocks and commodities a further boost.
US crude futures rose 8.3% last week to $79.86 a barrel. Copper prices rose 7.65%.
ETFs
Among the growth ETFs, the Innovator IBD 50 ETF (FFTY) was up 4.4% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) was up 2.1%. The iShares Expanded Tech-Software Sector ETF (IGV) surged his 4.9%. Van Eck Vector’s Semiconductor ETF (SMH) rose 6.7%.
Reflecting more speculative story stocks, the ARK Innovations ETF (ARKK) jumped 14.7% last week, while the ARK Genomics ETF (ARKG) surged just over 16%. TSLA stock is ArcInvest’s primary holding in his ETF. Kathy Wood’s Ark has replenished Tesla’s holdings in recent days and weeks.
The SPDR S&P Metal Mining ETF (XME) rose 6.3% last week to a seven-month high. Global X US Infrastructure Development ETF (PAVE) rose 4.2%. The US Global Jets ETF (JETS) was up 9.4%. The SPDR S&P Homebuilders ETF (XHB) rose 4.6% despite weakness. KB home (KBH) Earnings. The Energy Select SPDR ETF (XLE) rose 0.14%, with XOM shares being the main component. The Financial Select SPDR ETF (XLF) was up 2.1%. The Healthcare Select Sector SPDR Fund (XLV) was down 0.2%.
5 Best Chinese Stocks to Watch Right Now
Stock in purchasing area
Wendy’s stock saw a major reversal on Friday, jumping 6% to 23.08 after reaching an intraday low of 21.36. WEN stock regained his 50-day line, broke above the 21-day line, and broke above the trendline. This allowed an early entry into the new flat base. According to MarketSmith analysis, the official buy point is 23.88.
Wendy’s reported Friday its fourth straight quarter of accelerating sales growth, doubled its dividend and announced a $500 million buyback.
XOM’s share price rose 2.4% last week to 113.16, marking its fifth straight week of gains. The stock is just below the official buy point of 114.76 and in that move it doesn’t look like he is extending from the 50-day line. But investors have already been able to get into Exxon shares.
PWR’s share price rose 6.7% last week to 148.50, rebounding above the 50-day line and offering early entry. The stock has also regained its previous 144.41 buy point which is no longer valid.
CELH shares broke above the 50-day and 21-day lines on Wednesday, breaking the downtrend and showing multiple reasons for early entry. Stocks held support on the 21st and then rose on Friday. Celsius shares are ready for action after surging 13.2% this week.
Insulet’s share price rose 4.65% to 305.89 over the past week, rebounding from the 21- and 50-day lines. Stocks are now viable. However, investors can now wait for a trendline break just above Friday’s high of 309.44.
Tesla stock downshifting to cars?
Tesla shares rose 8.3% last week to 122.40, continuing a rebound from the January 6 bear market low of 101.81. The stock fell 0.9% on Friday, well below its intraday low, despite Tesla’s announcement of significant price cuts in the US and Europe. This comes a week after Tesla cut prices in key markets in China and Asia.
The price cut should spur sales, especially in the US, with more Tesla EV variants eligible for the $7,500 tax credit. This represents a significant price cut for US consumers. But Tesla’s precious margins are likely to take a hit.
On Tuesday, investors will get the weekly Chinese EV registration. This should mark a significant increase in Tesla sales and a possible impact on rivals. But will Tesla give a lasting boost, especially in China and Europe? With deliveries delayed significantly, Tesla will have to significantly increase new demand just to maintain its current pace of deliveries in 2023.
Already fierce competition in China will intensify in 2023, and Tesla’s price cuts could trigger a wave of cuts that slash profit margins. Europe is also getting more and more crowded. Even in the U.S. EV market, plummeting used-car prices are already a major drag on new-car prices, and competition will intensify in the year ahead.
But Tesla’s EV sales aside, there’s a bigger problem with TSLA stock. Investors are increasingly viewing EV giants as automakers rather than technology companies. Tesla’s current price/earnings ratio of 33 times his is not very high for a tech growth company. However, it is unusually high for an automaker. Auto industry dominance and profit margins tend to erode relatively quickly, and that may be happening to Tesla right now.
TSLA Stock May Deserve Higher Ratings For car manufacturersThis reflects still-strong EPS and revenue growth for the EV giants. But even so, it suggests a much lower valuation than was boasted until recently.
general motors (GM), ford (F) and the parent company of Chrysler and Fiat Stellantis (STLA) PE ratios are all single digits. Toyota (TM) is 10 o’clock.
Tesla vs. BYD: EV giants vie for the crown, but which one is the better buy?
Market rally analysis
The stock market rally had an encouraging week, supported by a strong rally on January 6th. Major indices rose strongly and returned to important levels. A number of major stocks posted buy signals during the week, with most holdings or gainers rising.
The S&P 500 Index has broken above the 50-day moving average and moved up to the 200-day line. The benchmark index hit resistance at its critical levels Thursday through Friday, but eventually surpassed it.
The Dow Jones, Russell 2000, and S&P MidCap 400 are above all moving averages and approaching December short-term highs.
Nasdaq has regained its 50-day moving average and has broken above the 11,000 level. The lagging index was close to the bear market lows at the beginning of the year.
Shares opened solidly lower on Friday. Earnings hit airlines, health insurers and bank stocks first, Tesla price cuts hit auto stocks and analyst downgrades hit major defense contractors.
Even without the negative headlines, with the S&P 500 on the 200-day line, the market was undoubtedly destined for a massive rally and then a pullback.
However, the market quickly rebounded and closed higher.
Industrial, the broader residential sector, much healthcare, some retailers and restaurants are showing strength.
Tech names are still falling short among major stocks, though they’re trying to make a comeback. The SMH Chip ETF topped the 200-day line last week, while the IGV Software ETF and ARKK are above his 50-day average.
The S&P 500 still has to definitively clear the 200-day line. December highs are well under pressure for all major indices.
The stock market doesn’t seem too worried about the Federal Reserve (Fed), but there is a path towards a moratorium on rate hikes and the earnings season takes center stage.
Time the Market with IBD’s ETF Market Strategy
what to do now
As the stock continues to improve, investors can make new purchases. But do so gradually. Market gains in recent days have shown strength and resilience, but for major indices, major sectors or individual stocks, declines are not surprising.
The next few weeks are likely to see significant volatility as earnings season intensifies.Exxon and Tesla shares will report in the next three weeks, along with tech giants apple (AAPL), microsoft (MSFT), Amazon.co.jp (AMZN) and the parent company of Google alphabet (Google).
So don’t focus too much on a particular sector, even if you’re doing well. We will strive to diversify our flagship brands.
Assemble your watchlist. Look for stocks that may become viable, ready or viable if suspended or retreated. Broader strengths, at least beyond technology, should offer many opportunities.
Read The Big Picture daily to stay in sync with market direction and key stocks and sectors.
Follow Ed Carson on Twitter. @IBD_E Carson Stock market updates and more.
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