Financial News vs. Noise

This video is a riot, I was happy to take part in it:

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Can This Extremely Loud Man Make You Rich?

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Looked like they were going to open hot and sell the market off for a third day in a row, but in the end the bulls gained traction. SPY looks like it's forming a base and I would suspect that as long as this week's jobs numbers aren't bad (not sure what bad is though, is good news bad news, or is bad news good news?) then it should test the highs.

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Prior to jobs on Friday, we have ISM services, ADP employment, and JOLTS also this week. A mid to stronger number argues for 25bps of cuts. It is possible that further weakening could warrant a 50bp cut. Powell has said that Fed Heads:

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“do not seek or welcome further cooling in labor market conditions.”

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Markets currently seem undecided between 25 or 50, Friday could bring that into more focus.

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From a buyers perspective I like QQQs better. You have a clear stop at the 50 day and more whitespace between where it is and the all time highs.

Meanwhile, the Dow is making all time highs.

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Looking at the iShares S&P 500 Growth (IVW) vs. iShares S&P 500 Value (IVE), value certainly looks stronger.

I don't think we see any great rotation and now that NVDA earnings are out of the way I would expect growth to catch up. That being said, I think you should have some way to get "value" into your portfolio. Personally, I run 3 versions of a mean reversion model that ends up sorting stocks by lower volatility being better. Most of the time that ends up spitting out value type names.

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Cautionary tale about making sure you understand what you are buying. A lot of ETFs are horribly put together and there is a big difference between weighting schemes.

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How to Lose Money on the World’s Most Popular Investment Theme-WSJ

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The result has been a 20-percentage-point gap between the best and worst AI ETFs this year. There is a more than 60-point gap since the launch of ChatGPT in November 2022 lit a rocket under AI stocks—although the ETFs are at least all up since then.

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INTC ended up on our short sale watch list coming into today. We have two models, one triggers a short on a 2% move up, the second on a 4%.

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Intel’s stock soars on hope of business split. Analyst says ‘don’t fall for it.’-MarketWatch

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Interesting spot. You have the high of the gap down day at $21.84 and the 20 day  EMA of $21.86. If it stays above it could end up filling the gap. I wouldn't be buying it here though.

I wrote about PSTG last week. It's a long term holding and I bought the earnings dip.

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This ‘AI Play’ Is Dropping. There’s More to the Picture Than Nvidia.-Barron's

I like the chart, nice undercut and rally at the 200 day.

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LLY is a name I trade. Outside of the AI theme, the weight loss drug theme is the next best thing out there. Sold the pop yesterday but I will be back in on a dip. I do not have long term holdings in the weight loss drugs because from an investment standpoint I'm a bit worried about what happens if RFK Jr. has influence over policy (as a human being I hope we start to focus on the cause of obesity, and no it's not an Ozempic deficiency)

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Eli Lilly Could Become the First $1 Trillion Pharma Stock. How Weight-Loss Drugs Can Get It There.-Barron's

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Pretty sure this is a closing high and right near the intraday highs.

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Meanwhile, they really want you to buy these weight loss drugs.

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Weight loss drugs cut Covid-19 deaths, study finds-CNBC.com

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People taking the key component of blockbuster weight loss drugs Ozempic and Wegovy were less likely to die of Covid-19 or suffer adverse effects from the virus, researchers found in a new study.

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Industrial metals are an area I like to trade. Goldman just cut it's forecast for copper. FCX is at an interesting spot right on the 200 day.

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AA looks at lot like it, but it failed at the 200 day last week.

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Yes it is, the question is how much trouble and when? Consumer Spending Is Rising at a Faster Rate Than Income. It’s a Recipe for Trouble.-Barron's