Momentum Monday…Bouncing Where They Should
Courtesy of Howard Lindzon
Good morning everyone.
Today is the last Momentum Monday of the year. Ivanhoff and I look back and ahead at some of the surprises and and what we got wrong and right.
You can watch/listen right here on YouTube and I have embedded it below:
Here are Ivanhoff’s quick thoughts…
The small-cap Russell 2k (IWM) tested its multi-month range lows last Monday and it bounced again. The large-cap, QQQ, and SPY also recovered from vulnerable positions below their 50-day moving averages. The participation in the rally was widespread – from reopening stocks like airlines, casinos, hotels, cruise lines, and beaten-down sectors like biotech and ARKK to momentum leaders like semiconductors.
The range-bound market environment remains intact. You don’t want to get too bearish when the main indexes are down several days in a row in a range market as was the case last Monday. You also don’t want to get overly bullish when the indexes are up several days in a row in the same environment.
The last and the first week of the year typically feature big short-term moves in beaten-down former momentum names. I will be watching for opportunities in those. We already saw stocks like BROS and MARA perking up on Friday.
Elsewhere…
Here is Charlie’s 7 chart Sunday
Have a great week.
Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. For full disclosures, click here.
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