Its been a wild couple of weeks and yet the Nasdaq sits a stones throw from new all time record highs... go figure.
The market opened sharply lower yesterday, however those losses were cut as the day wore on.
Some of the headlines I saw during the day said that the market was recovering despite any kind of positive news.
And I was thinking to myself.. the market gapped down despite any new negative headlines.
To see the market fight off weakness.... its almost like watching the NY Knicks when they have a lead. You still know they are going to lose the game. More often than not that is how its been with market weakness. At some point the market bears are going to lose... again.
That's what happens in a market thats been trending higher since the dawn of man.
And of course we get the nasty declines that keep the bulls sober.
The bears will tell you being long the market has been the easy trade.... and yet they've been trying to short the market every day since March 2009? hmmmm.....
2020 has shown that it hasn't been easy being long the market. And yet despite all the negativity over the years, calling for upside, while not the consensus, has been the right call. And until trading for downside becomes more right than trading for upside, my bias will remain with the trend.
It does'nt hurt that we have the FED and every Central Bank in the world gaming asset prices higher. Home prices are rising. Interest rates remain at historic lows. And the FED has made it clear, don't expect things to change for YEARS!!!
$7 trillion+ and counting... not even thinking about raising interest rates for years to come... and zero concern about asset bubbles...... put all that data into the biggest computer and what do you think it will tell you this means for asset prices going forward?
— UPBOptionMil (@UPBOptionMil) June 10, 2020
Anyway...
off the soap box...
I covered some names I like heading into 2021 a few weeks ago.
Guess what? I still like them.
AA, GS, MOS, NTR, EBIX, even BIDU.
GS - once they shake all the earnings options out today... expect the move up to resume on Monday....
AA - earnings drop yesterday doesnt change the longer term picture IMO. Lows in... downtrend broken... and recent support tests strong. I'll be trading for $15 - $16 - $20+ in 2021
EBIX - about as coiled as you will ever see. This stock averages 100k 200k volume a day and had some 7+ MILLION shares short.
MOS has been flagging for a while now.. getting set for a sharp move higher?
We'll see. My thoughts are the market is looking out and seeing this wave of the virus as been less severe than the first one. Of course there will be many more shoes to drop.
I don't know how much longer travel, cruises, hotels, entertainment can last... I think we are going to find out.
However after huge forest fire.. guess what? It comes back stronger than ever. And I think that is what we are going to see down the road.
Have a great weekend.