While Nvidia Sits Out the Rally, What Are People Fussing Over?
The 493 get a chance to move higher when Nvidia doesn't. Meanwhile, people are fussing over energy stocks.
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The Market
As we continue to rally into the overbought condition (I expect it to arrive late this week), I would once again point out that the 493 were able to rally because Nvidia (NVDA) did not. I hate to keep harping on this, but that’s the market we have.
I would note that the Transports made it to Day 8, and they broke out quite a bit. And there was no fussing. I am quite surprised at how little fussing there was. It’s still a great chart; it just needs a pullback.
What did everyone fuss over? Energy. I would just reiterate that the names I have liked in the energy area (for months, to no avail) are/have been: Exxon (XOM) , EOG (EOG) , Schlumberger (SLB) , and Valero (VLO) . There may be other names that creep in once in a while, but those are the ones I have written about several times.
The Utes have me concerned. They should have bounced by now, and they haven’t. Last Friday, the (XLU) had cleared 90 and looked poised to keep going. Now it has given back the entire rally. I believe this is the area it should hold, but it’s a lower low. Sure, it’s by a smidge, but it’s not what I expected.
Let me end by noting that you already know my work says we get overbought by Friday. You already know that the ten-day moving average of the put/call ratio is not that low, but it is now at .88, so it could get under .85 by Friday. Here’s what I want to add to this: the DSI for the VIX is back to 15. If the market does rally (quite frankly, the S&P is flat on the week) in the next one or two days, that VIX DSI is going to fall into the yellow zone (10-15), and I’d look for a correction next week.
New Ideas
A few weeks ago, I was asked about Paychex (PAYX) and the stock was on its lows. I suggested that if we got a poor employment number and the stock couldn’t go down anymore, then it was probably time to buy for a trade. This morning, we got some poor numbers from ADP, and not only did the stock not go down, it also rallied. I’d look for a push to resistance in that 116-117 area.
To show you how far down the speculative barrel we’re going, Rigetti Computing (RGTI) could be overdue to bounce to the low 30s. I would treat these as trades.
Today’s Indicator
The Volume Indicator popped to 53% but is right back to ---51%! It amazes me how it just seems to hug that 50% line.
Q&A/Reader’s Feedback
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Guardant Health (GH) has been a good, not great, stock since the summer. But up here, it’s not my cup of tea as it has more than doubled, almost tripled, since August. If I were long, I’d stay long with a trailing stop, but that’s all I see.
Omega Healthcare (OHI) has had a terrific November and has not done anything wrong. I expect it will correct and rally again. I’d love to see it back at 42.50-43.50, but that might be asking too much.
I really do want to like the staples stocks, and Procter & Gamble (PG) is definitely a staple, but for now, all I see is this channel that has been in place since March, and so I would just trade the channel until it changes.
The good news for Palo Alto Networks (PANW) is that when it broke down, it tagged its measured target at 180 and seems to have (barely) held the uptrend line. Right now, my guess is this rally stops at 200 and retreats. If it can hold the uptrend line again on a retreat, I might be inclined to look for more than 200 on the next trip up because it does have a big base. You might recall I saw the big base and did not like it a few months ago. I could not tell you why; it was just the way the pencil felt. But now it’s had a shakeout.
Honeywell (HON) has a history of gapping up on news that some PE firm has taken a position and then dying. I’ll give it some credit this time for holding 187, so as long as 187 doesn’t break, I’d give it a chance, but it would be on a short rope.
I don’t like the break of the blue line on Eaton (ETN) , but I do like that it tried to break 320 twice and couldn’t. I would use a stop under 320. Even if the chart gets going on the upside, there is a lot of resistance overhead.
Taiwan Semi (TSM) is a fine chart since it hasn’t done anything wrong. The next resistance is in that 310 area. I’d get cautious if it breaks that uptrend line.
I believe we looked at BlackRock (BLK) not long ago, and I thought it ought to hold that 1050 area and be okay. Yet it broke it handily. If it can map out as I have drawn in blue, then I would like that.
Airbnb (ABNB) has been awful since March, with an acceleration to the downside off the July high. Yet I find myself drawn to charts like this as we head into year-end. For now, the channel is real and should be your guide, but this has the potential to improve in the coming months.
(COPX) is an ETF to be long copper miners. It has a measured target in the 70-72 area. I would remind you that I have thought Freeport- McMoRan (FCX) has been basing, although I don’t want to chase it up here, but a pullback near 43 would be good.
PDD (PDD) is a stock that has done something wrong: breaking a solid uptrend line. If it can go sideways and build a pattern in the coming weeks, I might warm up to it, but right now, I am not a buyer but a seller.
