GWO Daily Note
Market Strategies Newsletter - Special Daily Edition
For Trading August 7th
Market Rallies
Gold Continues Higher
Still the Worst Month
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Today’s market was a reflex rally but it left a lot to be desired. While we gained from the start, and had several pullbacks toward unchanged, the close was +311.78 (1.21%) but still a lower volume, short range “inside day” 1,300 Dow points off the high just 4 days ago. Another issue for me is that while we didn’t have a lower open and then a reversal day today, we still made 273 new lows on the NYSE. Market internals were 2:1 volume and A/D on both the NYSE and NASDAQ. NAZ closed +107.23 (1.39%), S&P 500 +37.03 (1.3%), the Russell + 14.67 (.99%), and DJ Transports +132.29 (1.32%). The DJIA was 25 up, 4 down and PFE unchanged. While there were many double-digit gainers, GS was the biggest +29DPs, and most were 20 -24 DP maximum. I was unimpressed.
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: early morning movers were to the downside with Dean Foods (DF) the major producer of dairy products reported a major miss, and the stock, which has suffered a long decline from an adjusted high of $22 in 2017 had fallen as low as $ .87 in July, opened $1.23, traded as low as $1.05 and finished the day $1.06 -.61 (36.53%). Shares of Green Sky (GSKY) also suffered when the financial services company that arranges financing for home improvements and medical procedures missed. The company went public in May 2018, traded $27.00 and then fell to $8.30 by December had worked its way back to $16.00 in May opened the day $10.62 and then fell as low as $6.38 before closing $6.81 -3.97 (36.8%).
On the plus side we had EverQuote, (EVER) the online insurance company beat on top, bottom, and guided above consensus. Public since only June of last year the stock had fallen from $27.02 to a low of $4.06 in January, but had traded up to close yesterday $13.20 and opened $16.97 and finished pennies from the high at $19.70 +6.50 (49.24%). Shake Shack (SHAK) beat and announced a partnership with GrubHub for delivery. The stock had its best day since its IPO finishing $86.72 +13.38 (18.24%).
After the close we had a miss from DIS but after a drop from $141.87 to $133.63 – 8.24 from the close, the stock has worked its way back to $138.32, actually about unchanged on the day. WYNN beat and the stock which is down from $140 in the last week bounced higher from 111.87 to $118, but fell back to $111 -.87. Hertz HTZ, beat and after a close of $14.94 +.71 traded to $16.25 and is $15.60 +.66 (9.78%). Last, Match (MTCH) beat based on the growth in Tinder had already recovered most of yesterday’s loss closing $73.91 is currently trading $87.40, a new all-time high + $13.49 (18.25%).
Yesterday, the HOMERUN of the day was Allakos Inc. (ALLK) who reported positive results from a Phase 2 trial of AK002 for eosinophilic gastritis. Statistically significant changes for patients occurred within one day of treatment. The stock, priced at $18 last July has traded between a low of $26 and a high of just over $65 in December. It closed Friday at $31 but opened today $61 +30, traded $73.25 (new high) and finished $65.26 + $34.26 (110.53%). Well, today it opened @ $66.00 and continued higher to $85.40 before finishing the day $79.47 +14.21 (21.77%) for the 2-day gain of 156%.
BIO/PHARMA:stocks wereMIXEDwith LABU the biggest gainer +2.52 (6.46%), ICPT +1.97 (3.36%), and INCY +1.71 (2.11%) and on the downside TEVA -.73 (9.32%) and MYL -1.09 (5.63%) on opioid settlements. IBB was $103.75 +1.46 (1.43%).
CANNABIS:stocks wereHIGHERwith GWPH the biggest winner on earnings reflecting a major beat on a cannabis based drug +18.49 (12.2%), ACB +.71 (11.47%), and MJ $28.24 +.74 (2.69%).
DEFENSE:wasHIGHERwith BWTX beating on top, bottom and guidance was the big winner +7.17 (14.68%), and ITA $211.00 +4.44 (2.15%).
RETAIL:wasHIGHERwith the stores and the all the brands up. The only loser was JCP -.04 (6.19%) for the second day, and TJX the biggest winner +1.65 (3.25%), LULU +5.40 (3.1%), CPRI +.48 (1.51%) and XRT $40.61 +.51 (1.27%).
FAANG: and big cap tech wereHIGHERwith BABA the biggest gainer +4.19 (2.73%), GOOGL +16.12, AMZN +19.87, AAPL +3.41, FB +2.52, NFLX +2.21, NVDA +1.67, TSLA +1.58, BIDU -.90, BOX -.39, IBM -.08, BA +.52, CAT +.30 and XLK $77.12 +1.37 (1.81%).
FINANCIALS wereHIGHERwith AIG +1.57 (2.97%), GS +3.83 (1.9%), and XLF $27.11 +.43 (1.61%).
OIL, $53.63 -1.06The Oil has fallen into an area that makes it untradeable to me. Unfortunately, the 5-day and 20-day moving averages DID NOT cross to the upside last week and we broke down by $4.63 last week. I had actually put out a videohttps://youtu.be/l0dAAgk36fM when it was only -1.75 warning of the failure. Today we broke the uptrend line from the weekly chart. The stocks were lower and the smaller names suffered the most on a percentage basis. The XLE finished $8.48 -.12 (.20%).
METALS, GOLD: $1,484.20 + 7.70.Gold had another great day making yet another new high. While many think this has been a runaway market, it has actually been a steady gainer with consolidations along the way. It is also up another $5 tonight. An important development in the metals is the relative out-performance of the Silver market which moved up to close $16.445 +.052. This is important because for extended bull markets in the metals you need all of them moving in the same direction. Platinum, usually a premium over Gold is still running behind, possibly because the world demand for new cars is falling and the industrial need has diminished.
BITCOIN: closed $11,830 -80This market has worked off most of the overbought nature after the parabolic move to $14,000. We’ve had some consolidation here after closing the gap between 10,000 and 10,610. Last week I said “I think that we may have to test 9,200 before we move higher.” And this week we have been testing the lows in the 9,000’s with the low of $9,095. We’ll need a close over 11,155 to send us higher to test the highs. This market looks to me as if we are right on the edge of another meaningful break to the upside. I bought some GBTC just over $4.25, looking for another leg higher. We added to that position @ $4.75 and we sold half of the position @ $10.23, replacing it @ $9.36. I said I would replace that near $12.00 or so and that’s exactly what I did last Thursday at $12.10. We closed out 250 of the $9.36 shares at $16.78 for a gain of $1,855 and GBTC finished $14.77+.17. We need a close over $12,385 to break out again but we may have to close the gap at $10,870 first. Tonight’s low (so far) is 11,325, so it’s possible before the open.
Tomorrow is another day.
CAM / OZ
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