Retail Investors Blog

 Its stock recently peaked at $133.57 in January. From there it has retraced to ~$64/share. The question is, does it has room to go lower? The stock has been on a bull run since July 2022 at $23/share, which serves at the support level. The market is in panic, and the stock has sold off 50% over the last month. It is a good company, but if the market sense great sense of uncertainty and no stability in sight, it could continue to sell off until it retraces to $20s. The market can stay irrational longer than we can, therefore it is reasonable to believe that it could reach $10s.

Legendary Investor Stanley Druckenmiller advises that every investor should closely study the housing and trucking leadings indicators. If these leading indicators are weakening. The economy is more likely in trouble: Let's break down the key data points and their meanings from each of these sources: Housing: National Association of Realtors (NAR): Existing-Home Sales: Indicates the number of previously owned homes sold in a given period. A decline may suggest softening demand or affordability challenges. Median Existing-Home Price: The midpoint of all sales prices. Rising prices could signal a competitive market, while falling prices may indicate a cooling market. Pending Home Sales Index: A forward-looking indicator based on signed contracts to purchase existing homes. It provides insights into future sales activity. U.S. Census Bureau: Housing Starts: The number of new residential construction projects initiated. A decrease might suggest builders are less confident in t...

Powell's focus on data-dependency will likely dominate this FOMC week. With a resilient economy and low unemployment, 2-3 rate cuts seem feasible. However, the market is anticipating 4-6 cuts, which could lead to near-term volatility for being overly optimistic.  Stay informed, analyze incoming data, and be prepared for potential market swings.

Netflix's earnings helped bolster market optimism after the closing bell on January 23rd. I particularly like this movement because it will likely draw in FOMO (fear of missing out), which could fuel a larger market downturn in the near future.  Of course, I could be wrong, but here's how I think it might play out: The Federal Reserve (Fed) will likely take a more hawkish stance at the next two Federal Open Market Committee (FOMC) meetings. This could trigger market fears and uncertainty, leading to a sell-off and a flight to safe havens. Large-cap stocks could continue to be a safe haven for investors and ETF institutions during this period. The main reason the Fed is unlikely to cut rates quickly is due to several key economic indicators: The unemployment rate and jobless claims remain low, inflation showed potential for an uptick after the CPI data of 3.4%, and consumer spending continues to be strong. These factors give the Fed the comfort to keep rates steady for a while l...

Major US indices continued their climb on a wave of market optimism, though the pace slowed slightly. The S&P 500 edged up 0.2%, setting a new record high after last week's breakout achievement. Both the Nasdaq and Dow Jones saw modest gains, with Dow Jones surpassing 38,000 for the first time ever. However, the muted movements across all three indices hinted at a cooling in overall optimism, with investors adopting a more cautious stance . Key observations: Tech and consumer discretionary sectors led early gains. Bonds became more appealing with falling US Treasury yields. Low volatility reflected a stable market environment. Declining Treasury yields boosted bond attractiveness but sparked potential concerns about future inflation. More advancing than declining stocks across all three indices indicated a broad market advance. Moderate trading volume suggested a healthy level of participation and a balanced mix of pessimism and optimism. Investor sentiment remained bullish, an...

Overall, the January 19th market performance reflected a confluence of factors: positive economic data, easing concerns about inflation and interest rates, and strong sector-specific momentum in technology. This led to a broad-based rally and new record highs for the S&P 500 and Dow Jones indices , with all three major indices closing in the green and two of them setting new record highs. Indices Performance: S&P 500:   +1. 2% to 4, 839. 81 (new record high) Dow Jones Industrial Average:   +1. 1% to 37, 863. 80 (new record high) Nasdaq Composite:   +1. 7% to 15, 310. 97 (first time above 15, 300 in two years) Key attributes: Tech sector:   Led the rally,   bolstered by positive earnings outlook from semiconductor companies like Taiwan Semiconductor Manufacturing Co.   (TSM) the optimism on AI revolution. This belief fueled the excitement in companies like Super Micro Computer Inc with its stock price jumped +35.94%, ticker SMCI. Full disclosure. I...

The chart of Russell 2000 Index indicates three major support levels at ~$1,800, ~$1,720, and ~$1,637. It highlights to the potential of Russel 2000 Index going lower to below $1,800 given the current low jobless claims, good retail sales data, consumers resiliency, and FED’s stance over interest rate hikes. This index represents the well-known small cap stocks, which also highlights the possibility of many small cap stocks continuing on the downward slope.  Patience is required if you are sitting on cash and bullish on small caps over long term. There will be better entry in the next 3 months. Stay tuned for more updates.