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Today’s Summary
Wednesday, January 22nd, 2020
Indices: US stocks were little changed in today’s session with the Dow Jones Industrial Average changing just 10 points or 0.03%. The S&P 500 and Nasdaq moved only 0.03% and 0.14%, respectively. The Russell 2000 slipped 0.09%.
Sectors: Technology led, gaining 0.36%. Energy lagged for the fourth straight session, falling 0.96%.
Commodities: Crude Oil futures dropped 3.71% to $56.08 per barrel. Gold futures were unchanged and continue to trade around $1,558 per ounce.
Currencies: The US Dollar Index was unchanged.
Interest Rates: The US 10-year Treasury yield was also flat and is currently at 1.77%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
.@realDonaldTrump announced solar tariffs 2 years ago. And solar stocks have soared on an absolute and relative basis. $TAN pic.twitter.com/HmUuC4wGB6
— Mike Zaccardi, CFA, CMT (@MikeZaccardi) January 22, 2020
Today’s Chart of the Day was shared on Twitter by Mike Zaccardi (@MikeZaccardi). The chart shows the two-year performance of various energy ETFs including, The Solar ETF ($TAN), the Global Wind Energy ETF ($FAN), the Low Carbon Energy ETF ($SMOG), the S&P 500 ETF ($SPY) and the Exploration & Production ETF ($XOP). Mike points out that Solar stocks ($TAN) have outperformed the rest of these Energy subsectors on both an absolute and relative basis, despite the tariffs that were imposed on solar panels two years ago. We often preach the value of ignoring the news and avoiding making decisions around headlines. This isn’t because we think news never affects price. Instead, we believe that the news is often misleading, and we believe that it’s easier to focus on price action rather than trying to predict how the news will impact a security. We’ve been bullish on solar stocks for almost a year now because they’ve been exhibiting relative strength vs. the broader market. We would’ve missed this entire trend had we let tariff news impact our analysis.
Quote of the Day
“If you have a 10% chance of a 100x return, you should take that bet every time even if it’s going to feel bad 9 out of 10 times.”
– Jeff Bezos (Founder & CEO of Amazon)
Top Links
Another Look at Election Years – LPL Financial Research
The team at LPL Financial Research takes a look at the presidential cycle and how stocks tend to perform during election years. They point out that while election years tend to be strong, most of the gains come in the second half of the year.
Benzinga PreMarket Prep for January 22nd – Benzinga
Legendary Turtle Trader, Jerry Parker, made an appearance on the Benzinga PreMarket Prep show this morning. He shares his unique perspective on some of the things going on in the market right now.
Stock Market Swing Trade Ideas – The Trade Risk
In this video, Evan Medeiros breaks down the recent price action of the major averages and shares some potential swing trade ideas.
This Big-Box Retailer’s Run is Just Getting Started, Technical Analyst Suggests– CNBC
Ari Wald breaks down a chart of Costco ($COST), and he explains why he thinks the stock will move higher.
Banking on Breadth – The Final Bar
In this edition of the Final Bar, David Keller and guest, Greg Harmon highlight several noteworthy technical developments going on in the markets.
Top 10 Tweets
Oh, we’re doing this thing again ?
The S&P 500 hasn’t posted two consecutive down days in 27 trading days, the second-longest streak since January 2012 (only behind a 30-day streak that ended just two months ago).
— Callie Cox (@callieabost) January 22, 2020
$NDX rallied 14 out of 16 weeks, one of the longest streaks ever.
Most prior streaks led to 10-15% corrections – and the few times the market kept going, it ultimately paid a heavy price.
Respect the extreme momentum, but remain alert for reversals & signs of weakness in Tech. pic.twitter.com/NIlrHkQ2Xw
— Macro Charts (@MacroCharts) January 22, 2020
Great trend, but tactically Tech is stretched here. At nearly 20% above its 200-day average,that’s enough to qualify as a statistical extreme in our work. Chart from @verrone_chris @Todd_Sohn pic.twitter.com/avO3XdGuTG
— Strategas (@StrategasRP) January 22, 2020
Fascinating to see solid uptrends/breakouts/follow through on the defensive side of the ledger, particularly Real Estate and Utilities. $XLRE $XLU pic.twitter.com/J3AByPHJFI
— David Keller, CMT (@DKellerCMT) January 22, 2020
Bond yields (and copper for that matter) don't seem to be reflecting the same degree of optimism as stock prices. pic.twitter.com/vWYOvzRKch
— Willie Delwiche (@WillieDelwiche) January 22, 2020
Sure looks like $TLT is breaking to the upside here. (Obligatory reminder that bond & equity correlations are not static and are very often positive.) pic.twitter.com/nsZVYj9Ld9
— Tex (@theycallmetex) January 22, 2020
Path of least resistance is… down?$TNX $KRE $VNQ $HG $GC $GLD pic.twitter.com/F3VyV4fg0T
— Shane C. Murphy (@murphycharts) January 22, 2020
This chart isn't "presentation ready" , but $TTWO looks interesting here. Momentum in line with price action, multiple points of potential support when anchoring from the 3 latest earning dates, solid sequential revenue growth, and very little debt. pic.twitter.com/F1ih64mkv8
— Glenn C Williams Jr, CMT (@GWilliamsJr_CMT) January 22, 2020
$TSLA absolutely FLYING still! More than 150% gained in the last 100 days? pic.twitter.com/oNIFlEcpBD
— TradeLabs (@thetradelabs) January 22, 2020
The largest company by market cap over time https://t.co/HQAhy1xFQV pic.twitter.com/rgZb7UUbyY
— Trevor Noren (@trevornoren) January 22, 2020