EB Digest continued

If you're a trader, or you're considering becoming a trader, you have to understand that trading is a business and that your capital is your product. You can't give it away. That doesn't mean you can't have losses, because, believe me, you will have losses. But the key will be to keep those losses to a minimum. Don't allow small losses to morph into big losses. And that's much easier said than done. Humans are wired to always want to be right. When you sell at a loss, you're admitting that you made a mistake. But those admissions are critical to trading success. Nutanix, Inc. (NTNX) is a software company ($DJUSSW) that's been under a LOT of selling pressure the past two weeks after a massive move higher off its June low: ... keep reading

The S&P 500 is a market-cap weighted stock index, which means that the largest companies have the largest influence in the direction of this benchmark index. There are no companies bigger than Apple, Inc. (AAPL), which closed on Thursday with a market cap of $2.1 trillion. So AAPL is obviously the largest holding in the S&P 500. It currently weighs in at nearly 6% of the entire S&P 500. What AAPL does has a big influence on the direction of U.S. equities. Therefore, it's probably a good idea to watch and see if AAPL can hang onto price support established by the June low: ... keep reading

If you've been around the stock market for a long period of time, then I'm sure you can agree with this. Nearly a year ago, I made a really good call, expecting significant challenges in 2022, and even suggesting that we could see a low on the S&P 500 in the 3500-3800 range - on a worst case basis. Well, after moving slightly below 3500 in October, interest rates began to drop rapidly, falling from 4.33% on the 10-year treasury yield ($TNX) to 3.41%. That was another solid call. But my calls weren't perfect. With this drop in the TNX, I was expecting a big market rally led by growth stocks. Yet here we are, on December 21st with just ten days remaining in 2022, and I'm still waiting for growth stocks to truly launch - especially the large cap growth names. ... keep reading

Computer services ($DJUSDV) recently set a 52-week relative high vs. the S&P 500 and one of its strongest stocks has been Science Applications International Corp (SAIC), which has risen more than 25% in the past two months, while the S&P 500 has been up less than half that. SAIC recently posted solid quarterly results and raised its guidance for next quarter. The good news is that the stock has returned back to where it was prior to that earnings release, or has "filled its gap." Check this out: ... keep reading

By all accounts, 2022 has been a very difficult year. I was cautious/bearish heading into the year, but I've been expecting a strong Q4 to close out the year. While we are still higher since the end of September, the past few days' losses have given back most of the gains. There's a lot that goes into beginning a new uptrend, but one group that definitely deserves watching is semiconductors ($DJUSSC). On the chart below, you can see that the DJUSSC bounced in early October off of a critical trend support line: ... keep reading

I love to find stocks that begin to provide corroborating bullish signals. The semiconductor industry ($DJUSSC) has begun to show relative strength right on cue. Over the past decade, the DJUSSC has outperformed the benchmark S&P 500 by more than 6 percentage points during the November through March time frame. From April through October, however, this aggressive technology group has outperformed by less than 3 percentage points. Historically, we've entered the sweet spot for semiconductors. That's good news for Monolithic Power Systems, Inc. (MPWR), which had struggled badly from August through October: ... keep reading

One of the most difficult things to do in the stock market is evaluating a downtrending stock for a potential bottom. We can see certain patterns like double bottoms or reverse head & shoulders patterns. Perhaps there's a positive divergence. Maybe we'll even see an exhaustion gap. But nothing works better than simply seeing prices begin to trend higher, while key technical support levels hold. Let's look at Mohawk Inds (MHK), a furnishings company: ... keep reading

Technical analysis never provides us a guarantee. Every single signal fails from time to time. That's why I believe it's important to line up as many bullish signals as possible before taking a position. The more bullish characteristics I see on a chart, the more confident I'll feel about the trade. With this in mind, let's consider the case for Celsius Holdings, Inc. (CELH): ... keep reading

It's been a very rough year for many stocks, but few have been beaten up as badly as Meta Platforms (META, formerly Facebook). META hit a 2002 high on January 4th at just above 343. Ten months later, on November 4th, META reached its low at 88.09. That's nearly a 75% haircut in less than a year. Ouch! META's latest miscue came as it reported its Q3 quarterly earnings. After coming up significantly short of its EPS consensus estimate and issuing a Q4 warning, META gapped down, taking out its previous price support of 123.53. Despite its weakness in early November, META staged a rally, reaching a high close of 123.49 last Friday. Unfortunately, that's where its current advance ended. ... keep reading

On Sunday, I wrote an article in my Trading Places blog at StockCharts, "December Historical Tendencies Tell Us This Could Be A Stock Picker's Month". It provided a number of historical, or seasonal, tendencies that we should all at least be aware of, so please check it out, if you haven't already. One piece of the article discussed that value stocks tend to perform better than growth stocks throughout Q4, but especially during the month of December. ... keep reading