|Day's Range||0.9100 - 0.9100|
There's a rare opportunity in the stock market right now, according to one JP Morgan quantitative analyst. Yahoo Finance's Seana Smith and SALT Financial President Alfred Eskandar.
From the YFi Interactive touch screen, Jared Blikre joins Alexis Christoforous and Brian Sozzi to break down the latest moves in bitcoin as Libra draws Congressional and regulator criticism and concern.
A powerful force called the gamma effect or gamma trap is creating periods of stock market calm followed by surges in volatility.
According to the IEA, any large upside in crude oil prices isn't likely due to a possible economic slowdown dragging the demand and rising oil exports.
On July 11–18, major energy ETFs had the following correlations with US crude oil active futures: the Energy Select Sector SPDR ETF (XLE): 42% the SPDR S&P Oil & Gas Exploration & Production ETF (XOP): 32.3% the Alerian MLP ETF (AMLP): 23.1% the VanEck Vectors Oil Services ETF (OIH): 12.3% Notably, US crude oil active […]
Just when it seemed that U.S. stocks were heading for a third down day on Thursday after hitting new all-time highs early in the week, the Fed came to the rescue once again. This time around, New York Fed President John Williams said in a speech that "it's better to take preventative measures than to wait for disaster to unfold." Essentially, Williams appeared to be advocating a swifter and more aggressive approach to cutting interest rates than what had previously been expected. Stock indexes had been falling deeper into the red on Thursday before Williams' speech but quickly reversed and moved higher on this new sign of enhanced Fed dovishness.
The terms "bull" and "bear" market are used to describe how stock markets are doing. A bull market is favorable and rises in value, while a bear declines.
In the event the U.S. government runs out of cash in September, it will not be able to issue payments on the outstanding $22 trillion debt load. Mnuchin said both sides of the political aisle agree it would be unwise to put the U.S. government in a scenario where it could default on payments. As it stands now, no one in the government wants the issue to turn into a government shutdown.
Many investors watch the headlines like hawks, but moves in the market aren't as dependent on those as many people think. More often, stock market moves are due either to noise or to how markets react when they reach important levels. And considering those, Amazon (NASDAQ:AMZN) and these six SPDR ETFs are telling me that the rally is over for now.For an example of noise, suppose a person deposits money into a mutual fund at the same time that another person withdraws twice as much. The traders at this mutual fund will now need buy stocks to invest the deposit. At the same time, they will need to sell twice as many shares of the same stocks to raise the funds for the withdrawal. This will cause the prices to go lower. This happens thousands of times across the world every hour of every day. You can understand how it could move the markets.Then there's the reaction the various sectors have when they get to important levels. For example, I think this rally is over for now because most of the economic sectors that make up the S&P 500 are at or just under resistance.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 9 Retail Stocks Goldman Sachs Says Are Ready to Rip In addition, the consumer discretionary sector has been one of the leaders of the recent rally and it is losing momentum. AMZN is the largest component of this sector and it is overbought and at resistance.First, we will look at some sectors and you will see what I mean. Then we'll go over levels in Amazon stock. And lastly, we will look at the SPY. Industrial Sector SPDR (XLI)The Industrial Sector SPDR (NYSE:XLI) is testing resistance at the $78.50 level. You don't need to be a Market Guru or a Master Trader to see that this level is important. It was resistance at the end of April and in early May.According to academics and random-walk believers, support and resistance levels shouldn't exist. After all, how can a basket of dozens of stocks have the same exact valuations at two very different points in time?But support and resistance levels obviously exist. You do not need to have a PHD to see them. Financial Sector SPDR (XLF)The Financial Sector SPDR (NYSE:XLF) is testing resistance around the $28 level. This level was resistance in April.During last August and September, the financial sector did not participate in the rally. That was one of the key signals that the market was nearing a major top. * 7 Dependable Dividend Stocks to Buy This shows why it is important to examine the undercurrents in the markets in order to really understand how to profit. Last summer the media was going crazy over the bull market, just like now. There was talk of melt-ups and amazing new records. However, savvy investors saw the underlying weakness in the financials and knew that this was a signal that the rally was about to end. Health Care Sector SPDR (XLV)The Health Care Sector SPDR (NYSE:XLV) has been consolidating around resistance at the $93 level and it may be starting to trend lower. The $93 level was resistance in February as well. One of the main reasons for this is that Johnson and Johnson (NYSE:JNJ) is 10% of this sector and some analysts think the company is facing some significant headwinds.JNJ just reported earnings that were better than analysts expected, and yet the stock price still dropped. This is probably because JNJ is being sued for its role in the opioid crisis, and investors are worried about the outcome. It is also being sued for allegedly selling dangerous talcum power for babies.I am not a lawyer and won't guess what the ultimate outcome of these lawsuits will be. What I do know is that even if JNJ stock is innocent of these accusations, it will still incur significant legal costs and damage to its reputation. Utilities Sector SPDR (XLU)The Utilities Sector SPDR (NYSE:XLU) has been testing resistance around the $28 level over the past month. This sector typically pays higher dividends than most others. Because of this, there has been more interest than usual in this sector due to the action of the yield curve.The yield curve illustrates the yield on bonds of all different durations. The vast majority of the time, the longer the term of the bond, the higher the rate of interest that it will pay. This is simply because the longer the timeframe, the greater the odds are that the bond will default. In order to take on this extra risk, investors need a higher return. * 10 Best Dividend Stocks to Buy for the Rest of 2019 and Beyond When the yield curve inverts, it means that shorter-term rates are actually higher than long-term rates. This is typically an indication that traders are bearish on the economy. They do not want to hold short-term bonds. They sell, and this drives down the price and makes the interest rates go up. Then they buy long-term bonds and makes the price rise and the yield fall. Consumer Discretionary Sector SPDR (XLY)The Consumer Discretionary Sector SPDR (NYSE:XLY) has been one of the leaders of the recent rally. However, the sector is now very overbought. The last time it was this overbought was in April, and a large move lower followed. A big part of the reason for this is AMZN stock. Amazon is about 20% of this sector, and it is at resistance.If the XLY heads lower, there will probably be support around the $121 level. This because this level was resistance in April and June.What does the term "overbought" mean? It is a measure of a stock's momentum, looking at where the price is now versus where it was X days ago. When stocks reach extremes of this measurement, traders refer to it as overbought or oversold.For example, according to statistics, 95% of all trading should be within two standard deviations of the average. If a stock is trading more than two standard deviations above or below the average, it would be considered overbought or oversold. It will most likely revert back to its average. Amazon (AMZN)Amazon is overbought and testing resistance. The last two times AMZN stock was this overbought were in September and May. A large selloff followed both times. In addition, it is testing resistance around the $2020 level. There is resistance at this level because it was the top and an all-time high last September. Stocks frequently run into resistance when they get to levels that were prior tops. * 10 Stocks Driving the Market to All-Time Highs (And Why) There is also excessive bullish sentiment on AMZN. Currently, 47 Wall Street firms follow it and every single one has a buy rating on it. Excessive bullish sentiment is actually a bearish indication. This is because if everyone likes the stock, everyone has bought it. Now there are no buyers left and the only way it can do is lower. S&P 500 SPDR (SPY)The S&P 500 SPDR (NYSEARCA:SPY) is also overbought. If it heads lower, there will probably be support around the $294 level because it was a resistance level in April. Why do resistance levels become support levels? Consider the following.After hitting the resistance at $294 the SPY traded lower. Those who sold it are happy that they sold. Those who shorted it have a profit. But then the SPY rallied. Now those who sold it tell themselves that if the SPY comes back to $294, they will buy it back. Those who shorted it are now losing money. They tell themselves they will cover it at $294 and break even.Those who bought it at $294 are happy that it went higher and tell themselves that if the SPDRs come back they will buy more. Add to that the professional traders who see a clear level and want to profit from it, and now we have 4 groups of investors who want to buy the SPYs at $294.As of this writing, Mark Putrino did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 9 Retail Stocks Goldman Sachs Says Are Ready to Rip * 7 Services Stocks to Buy for the Rest of 2019 * 6 Stocks to Buy and 1 to Sell Based on Insider Trading The post These 6 SPDR ETFs and Amazon Tell Me the Rally Is Over appeared first on InvestorPlace.
Since the EIA (U.S. Energy Information Administration) released its inventory data on July 10, US crude oil August futures have fallen 4.7%.
Shares of Aurora Cannabis (NYSE:ACB) haven't been looking so hot. In fact, on July 12 alone, shares tumbled more than 5%. But the fall did more than give investors a sour ending to the week. It sent shares through a key level of support and all but put the nail in the short-term coffin of pain.Source: Shutterstock InvestorPlace - Stock Market News, Stock Advice & Trading TipsOK, maybe that's a little extreme. But the point is that ACB stock is not looking healthy on the charts. While that doesn't mean Aurora Cannabis can't bounce back and repair some of that technical damage, it makes it a lot harder to do so. From an investing standpoint, I like to blend technicals and fundamentals. When the technicals are not strong -- like with ACB stock -- we need to lean more heavily on the fundamentals. When the fundamentals are not the stock's strong point, we need the technicals to display strength. Unfortunately for Aurora Cannabis stock investors, while its end market looks to be a long-term opportunity, its fundamentals are not that strong in the short term. Without technicals to lean on, this stock could have more downside coming. Trading ACB Stock Click to EnlargeWith shares of ACB dumping on Friday, the stock lost a key level of support between $7 and $7.25. For the stock to even come close to repairing some of this damage, it needs to reclaim this former level of support. * 7 Dependable Dividend Stocks to Buy The risk here is two-fold, with the first being that Aurora Cannabis stock continues to head lower. The second risk is that it rebounds back up to the $7 to $7.25 range, which then acts as resistance. That would be bad news for the bulls. On Monday, ACB stock was rallying back toward that prior range support, so we should know relatively soon whether it can reclaim this area or if it will be found as resistance. At least we don't have to wait long to find out. Should ACB stock reclaim that key support area, it may run up toward $7.50 to $8. But here's the problem for traders looking to take ACB on the long side. Even if it reclaims prior support, it has to push through this next area too, before looking healthy again. And what's between $7.50 and $8? Just 2019 downtrend resistance (blue line), the 20-day, 50-day and 200-day moving averages. I'm not saying ACB stock is the worst equity to buy or that it's doomed. But until it repairs its technical damage and starts to put together more constructive price action for the bulls, it's a hard one to go long. Particularly as the PowerShares QQQ ETF (NASDAQ:QQQ) and SPDR S&P 500 ETF (NYSEARCA:SPY) are hitting new all-time highs. The breakdown in ACB stock was actually preceded by Canopy Growth (NYSE:CGC). CGC stock broke down ahead of ACB and led the way lower for a number of cannabis stocks. What's Up With Cannabis Stocks?So what's leading this charge lower? Because it's not just CGC and ACB stock. Cronos Group (NASDAQ:CRON), New Age Beverages (NASDAQ:NBEV), Aphria (NYSE:APHA) and others are all taking a very similar bearish setup. On the charts, this setup is known as the bearish descending triangle. Simply put, it's when trend is pushing shares lower against a static level of support. When support gives way, the bearish setup starts to play out, forcing share prices lower. The question is, why is the entire industry all setting up in the same manner? * 10 Best Dividend Stocks to Buy for the Rest of 2019 and Beyond Things really started to unravel when Canopy Growth -- which many consider the "blue chip" stock of the bunch -- ousted its CEO. Canopy was volatile but stable that day, but has been under pressure all month since. It seems to have turned investors into sellers throughout the group, as the cannabis industry awaits a new catalyst. That's even as growth has been incredible, with many of these names turning in earnings reports of triple-digit revenue growth gains.While Aurora Cannabis missed analysts' estimates, it still churned out revenue growth of 289% last quarter. That said, most of these names -- ACB included -- do not generate profits and do not have the strongest financials. Thus, we need the technicals to behave better to justify a long position. For now, I'd wait before establishing a position in ACB stock. Long-term investors may opt to accumulate the stock, but I would rather wait until the stock looks healthier. One alternative would be a position in Constellation Brands (NYSE:STZ), which owns 40% of CGC, but has strong fundamentals and a good-looking chart to boot. Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell held no position in any aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 9 Retail Stocks Goldman Sachs Says Are Ready to Rip * 7 Services Stocks to Buy for the Rest of 2019 * 6 Stocks to Buy and 1 to Sell Based on Insider Trading The post Does Aurora Cannabis Stock Chart Point to a Mid-Summer Plunge? appeared first on InvestorPlace.
The booming demand for government debt demonstrates that while the S&P 500 reaches new highs, many individual investors remain cautious.