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Stock Market

GeorgiaGirl

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Markets real heavy after the China Evergrande news...couple that with the inflation reports its getting ugly.

Tech has been trading in this channel for past year+...each time it's touched the top of that channel it's sold off hard to the bottom....we shall see if it bucks the trend this time.

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That's another version of the channel that I was thinking about when I saw somebody claim that we have entered a dot.com like bubble rise. I didn't actually reply to them (thought about it though), but I was thinking whoa, slow your roll, NDX has not broken the channel it's been in.

As bad as that inflation reading was, it was either that garbage 30 year bond auction or the Evergrande news that actually set off what happened this afternoon. And the thing is, that Evergrande news might not be truthful. That German site that leaked it is sketchy to me. What is true though is China's real estate market is a mess and they are likely to see an economic slowdown due to it.

And that's well known, so honestly, I'll probably take the side of the bond auction being the trigger.

It sounds as if China is trying to quietly take apart Evergrande and somebody leaked something they shouldn't have btw.
 

KyloG

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That's another version of the channel that I was thinking about when I saw somebody claim that we have entered a dot.com like bubble rise. I didn't actually reply to them (thought about it though), but I was thinking whoa, slow your roll, NDX has not broken the channel it's been in.

As bad as that inflation reading was, it was either that garbage 30 year bond auction or the Evergrande news that actually set off what happened this afternoon. And the thing is, that Evergrande news might not be truthful. That German site that leaked it is sketchy to me. What is true though is China's real estate market is a mess and they are likely to see an economic slowdown due to it.

And that's well known, so honestly, I'll probably take the side of the bond auction being the trigger.

It sounds as if China is trying to quietly take apart Evergrande and somebody leaked something they shouldn't have btw.

I agree about China/Evergrande. They are going to try and unravel that slowly/quietly. It's a big risk for sure.
 

KyloG

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IWM is interesting...clear breakout, with volume. A back test of $234-$235 would be bullish still but if it falls back in the channel then that would suck. But, even if it does fall back in I think it does break out again.

I closed out my IWM in the low $240's last week but will jump back in at $235'ish.

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Thor

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Anybody on RIVN yet? Was letting the IPO play out a bit trying to identify my first entry maybe around mid 90s or so.
 

Jimmy Hypocracy

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If you started investing/trading after 2010 all you know is that markets/stocks only go up and to buy any dip with both hands. Old guys like me (45) lost a lot of money in dotcom crash and financial crisis. That's why these young bucks are kicking our butts in returns, they have no fear and always keep buying buying buying. Experience is a detriment right now...
Good post. I can relate to getting nuked on a stock or two. That ---- sticks with you. Nearly impossible to shake. Father in law got burnt years ago and hasn’t been the same since either.
 

VegasEagle

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Can you just give me $1,000,000? I'd be happy with that. I don't deserve it, but in case you ever decide to give a random weather board friend some dough, I thought I'd throw my name in the hat. 🙂
Nope, you get $10,000,000..... have you seen the prices of things?
 

KyloG

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IWM building nicely. Added back some this week. Really want that 20dema to catch up but I don't think it will...people just like buying more than selling.


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Rain Cold

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KyloG

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KyloG

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IWM looks good. Broke below that little trendline but then reclaimed and took out yesterday's low.

4hr chart. I added more through $237 and stop at today's low.

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GeorgiaGirl

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I think the Russell 2000 is going to test its old ATH, I'm not a fan of the way non-tech (outside of some consumer discretionary) traded yesterday. Tried to rally and got squashed and the squashing is carrying over so far.

I think it'll bounce there, but if not, then I've heard that the bulls have the ball as far as 2310.
 

KyloG

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Well this didn't work...got stopped out. Macd cross and now needs a few days to base.
 

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GeorgiaGirl

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Imagine being bearish and catching a break since the Austrian lockdown news moved things a lot, but you're short on the Nasdaq which has absolutely lost it.

More seriously, I'm not a fan of the way the market has trended since about 2 PM on Tuesday. Possible that tech is just letting other parts of the market rest, but then it's also possible that tech gets sold and you still get more selling from the other parts of the market.
 

KyloG

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At the beginning of the year Fidelity's recommendation was that tech would have a down year and to invest in foreign funds. Well tech is up 30% on the year...a friggin ETF up 30%. I wonder how long this will keep up....this has been going on 12 years and it looks like no end in sight.

Thank goodness I didn't invest in foreign funds. I did scale back in tech and invested in more dividend growth which was great first 6 months of year but tech is where it's at.
 

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Broken024

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At the beginning of the year Fidelity's recommendation was that tech would have a down year and to invest in foreign funds. Well tech is up 30% on the year...a friggin ETF up 30%. I wonder how long this will keep up....this has been going on 12 years and it looks like no end in sight.

Thank goodness I didn't invest in foreign funds. I did scale back in tech and invested in more dividend growth which was great first 6 months of year but tech is where it's at.
Biden picked Powell for second term today....

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GeorgiaGirl

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I hate reversal days to the downside like this one. The worst part about it is had the market closed 20 or 30 minutes before it does, I wouldn't have had as much problem as I do.

It's not that I have trouble resisting FOMO, it's that I wanted to enjoy where we were at in the middle of this morning a little longer and not concern myself too much about small and mid-cap growth being on a journey to the centre of eternity (reference to a song I like, lol).

What's interesting is that the market internals are oversold because of how badly small and mid-cap growth are getting hit, but then bigger cap tech has barely sold. I wonder if what happened late this morning/early this afternoon was capitulation there, or if whether it keeps going.
 

KyloG

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Trying XBI at $118.40. Right at bottom support of long channel. It either holds or it's flushing.
 

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KyloG

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One thing that has happened is the high growth cash burning names such as SNOW is getting pummeled. DKNG/UPST/NET...so many of these names. Is this a short term issue or is the market saying we aren't giving these companies 50-60x valuations anymore.

SNOW was trading at 120x sales...that's absurd but people were buying it. I can't invest in companies like this, not at 120x sales while burning cash. But the market rewarded people that invested in these for past couple of years.
 

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KyloG

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One thing that has happened is the high growth cash burning names such as SNOW is getting pummeled. DKNG/UPST/NET...so many of these names. Is this a short term issue or is the market saying we aren't giving these companies 50-60x valuations anymore.

SNOW was trading at 120x sales...that's absurd but people were buying it. I can't invest in companies like this, not at 120x sales while burning cash. But the market rewarded people that invested in these for past couple of years.

Will be interesting to see how 2022 goes for these high growth potential that are trading at 30-40x and some 80-100x sales multiples.

 

GeorgiaGirl

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My running theory is that the high growth land carnage doesn't resolve until the Nasdaq drops 20%.

I still theorize that next year is going to be 2018-esque...maybe even something slightly more volatile, and both cases would mean a 20% drop in the Nasdaq happens at some point.

I do not think there's going to be a proper crash though, as too many are calling for something like that.

In other news, the Russell 2000 is still alive. Would've been nice if 2360 held, but apparently the actual bull/bear line is 2310, and it probed underneath and bounced. Hopefully, the low is in.

Zoom's valuation didn't make sense to me last year, and it's the kind of stock that still may be in trouble if the theory that I have plays out.
 
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