Happy Sunday,
A potentially volatile week is coming up with Fed speak on Wednesday with the broader market so close to all time highs. Remember what happened the last time this happened? It was July 31st and the very beginning of the August swoon. Hold on to your hats.
Broader Market Update
The Dow Jones Industrial Average is less than 1% from the peak in late July, however, price is seeking the ascending yellow line (see weekly chart) which is slightly higher than the July all time high. This yellow line is currently the most important level. If it gets there, which I expect, it is a likely place for a short term reversal. It could be a large reversal or a small dip. While no one knows what will happen my expectation is we will soon release to new highs with or without another dip and 2020 will be an expansionary year with technology and financials leading the way.
SPDR Dow Jones Industrial Average ETF (DIA) weekly
The “clean” weekly chart of the technology sector ETF (XLK) is a good visual of the overall tech trend that has been leading the market.
SPDR’s Select Sector ETF (XLK) weekly
My Favorite ETF’s
Last week I listed my favorite ETF’s to own during the 2020 expansion. Please refer to September 8 post, “Bullish, Sgt. Peppers Lovely Charts Club Band” for charts. These are good to own if you don’t want the risk of owning individual securities. This is a dynamic list and constantly subject to change as price action plays out.
Here’s the ETF list:
- SPY…SPDR’s S&P 500 Trust Series ETF
- DIA…SPDR Dow Jones Industrial Average ETF (DIA)
- QQQ…Invesco QQQTrust Ser 1
- XLK…SPDR’s Select Sector Technology ETF
- XLF…SPDR’s Select Sector Financial ETF
- XLY…SPDR’s Select Sector Consumer Discretionary ETF
- XLV…SPDR’s Select Sector Health Care ETF
- XLC…The Communication Services Sector SPDR Fund
- XLP…SPDR’s Select Sector Consumer Staples ETF
- SOCL…Global X Social Media Index ETF
- SMH…VanEck Vectors Semiconductor ETF
- XTN…SPDR S&P Transportation ETF
- XRT…SPDR Retail ETF
- IGV…iShares S&P GSTI Software Index Fund ETF
- KWEB…KraneShares CSI China Internet ETF
- TECL…Direxion Technology Bull 3X
Individual Stocks on my Watchlist…and some more ETF’s
I am trying to narrow the list of mostly large cap individual stocks that I think will be best positioned for the expansion that I expect to begin soon. I still think there is a good possibility of another dip soon (and the timing with Fed speak on Wednesday is an interesting coincidence), especially as we approach the peak from late July in the broader market, however, that may or may not happen. The bottom line is I am feeling cautious short term until the broader market releases above the prior peak then either re-tests or dips below then breaks out again. When that happens I think the market will be free to expand out of the 20 month consolidation zone it has been in.
Here are some the individual stocks I am really interested in (some are already in Open Idea list and some I own currently). Subject to change of course as price action confirms positioning.
- Apple Inc (AAPL)
- Amazon.com (AMZN)
- Visa Inc (V)
- PayPal Holdings Inc (PYPL)
- Oracle Corp (ORCL)
- The Trade Desk Inc (TTD)
- Ulta Beauty Inc (ULTA)
- Wayfair (W)
- Kohl’s Corp (KSS)
- Tesla Inc (TSLA)
- Visa Inc (V)
- Monster Beverage Corporation (MNST)
- Facebook Inc (FB)
- Amphenol (APH)
- Xilinx (XLNX)
- Netflix Inc (NFLX)
- The Walt Disney Company (DIS)
- Proctor & Gamble (PG)
- Cisco Systems Inc (CSCO)
- Costco Wholesale Corp (COST)
- Cadence Design Systems (CDNS)
- CBRE Group, Inc. (CBRE)
- Pepsico Inc (PEP)
- Home Depot Inc (HD)
- HCP, Inc (HCP)
- Chegg Inc (CHGG)
- Baozun Inc (BZUN)
- YETI Holdings Inc (YETI)
- Sonos Inc (SONO)
- CRISPR Therapeutics AG (CRSP)
- Urban Outfitters Inc (URBN)
- Tandem Diabetes Care Inc (TNDM)
- Enphase Energy Inc (ENPH)
- Icahn Enterprises Lp (IEP)
- RA Pharmaceuticals Inc (RARX)
- Dell Technologies Inc (DELL)
- Twitter, Inc (TWTR)
- Splunk Inc (SPLK)
- MongoDB Inc (MDB)
- Elastic NV (ESTC)
- American Airlines Group Inc (AAL)
- iQIYI Inc (IQ)
- Teladoc Health Inc (TDOC)
- China Southern Airlns Co (ZNH)
- Autonation Inc (AN)
- Guggenheim China Technology ETF (CQQQ)
- ProShares UltraPro Financials (FINU)
- StoneCo Ltd (STNE)
- Autodesk Inc (ADSK)
- Adobe Systems Inc (ADBE)
- Direxion Daily Semicon Bull 3X (SOXL)
- Workhorse Group Inc (WKHS)
- Invesco Dynamic Software Portfolio ETF (PSJ)
- iShares Dow Jones Medical Devices Index Fund ETF (IHI)
- iShares Dow Jones US Aerospace & Defense Index Fund ETF (ITA)
- Invesco Active US Real Estate ETF (PSR)
- iShares MSCI India Index (INDA)
- Pinterest Inc (PINS)
- Monster Beverage Corporation (MNST)
- Central Valley Comm Bancorp (CVCY)
- Zscaler Inc (ZS)
- Applied Materials Inc (AMAT)
- Arista Networks Inc (ANET)
- Ferrari NV (RACE)
- Broadcom Inc (AVGO)
- Salesforce.com Inc (CRM)
- E TRADE Financial Corp (ETFC)
- Direxion Small Cap Bull 3X Shares (TNA)
- Automatic Data Processing Inc (ADP)
- Aflac Inc (AFL)
- Allstate Corporation (ALL)
Weekly Mini Rant
There are some really smart people out there in “Stock Market Professional Land” but…there are a lot of people that just don’t have a clue. Why is CNBC’s segment called Fast Money? I bet if someone looked at their track record they would change the name to Slow Money. Sorry, I just can’t hold myself back sometimes.
Exit Gold
My recent entry and exit ideas in GDXJ , the junior gold miners ETF, returned the bulk of the recent move higher in gold. If you still own any you might want to consider exiting soon (should get another short pop before longer decline). I think gold will weaken into 2020. See daily chart of GLD.
SPDR Gold Trust (GLD) daily
Bitcoin
As many of you know, my entry idea on GBTC, the Grayscale Bitcoin Trust ETF, on March 4th this year has been a ripper…$4.40 to $12.59. As I have noted, I continue to accumulate on dips as price action is following the same pattern as the rise in 2017. If it continues to repeat it will go much higher. This is speculative! Beware.
Grayscale Bitcoin Trust (GBTC) daily
Conclusion
Sorry, my “short” list is not very short. This is actually a good thing as so many individual stocks are positioning themselves down into their “slot” to start ramping higher inside their expansion channels. We will see but I remain cautiously BULLISH.
Have a joyful week,|
Don