Wealthpress

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• 2 Stocks That Could Lower Your Risk and Increase Profits
• GameStop Bulls Crushed Hedge Funds. This Stock Could Be Next
• Stock Market Recap: Tuesday, Jan. 26, 2021
• 5 Stocks That Could See a GameStop-Like Moon Shot
• Don’t Get Burned: How to Be a Successful SPAC Trader
• What Is the Tunnel Trader Strategy? Everything You Need to Know

2 Stocks That Could Lower Your Risk and Increase Profits Posted: 27 Jan 2021 07:21 AM PST Global stock markets retreated this morning as investors turned their attention to today's Federal Reserve policy meeting. In the U.S., Dow futures are down 300 points, while Asian stocks were mixed and European shares fell.  It's likely that the Fed will continue with its strategy to keep the markets running without a hitch by holding short-term interest rates near zero and buying about $120 billion in government-backed bonds each month.  But don't get too excited, folks… In today's video, I'll explain why the stock market is increasingly volatile… the most important factor to pay attention to right now… why Nasdaq 100 momentum levels could be concerning… and two stocks that could lower your risk while increasing profits.    P.S. Imagine a trading strategy so powerful that, when applied accurately, it could give you the chance to trade with near-perfect accuracy.  Sounds impossible, right?  It's not. And for a limited time, you can learn the strategy that 10-time trading champion Chuck Hughes used to profit from 97% of the positions he took over the past two years.  Don't pass up on this opportunity to learn Chuck's trading secret.  Click here for complete details. The post 2 Stocks That Could Lower Your Risk and Increase Profits appeared first on Wealthpress.

GameStop Bulls Crushed Hedge Funds. This Stock Could Be Next Posted: 26 Jan 2021 02:33 PM PST Unless you were unconscious yesterday, chances are you heard about the massive short squeeze on GameStop initiated by a ragtag bunch of Redditors. The audacious posts put forth by the "WallStreetBets" crowd were honestly a boatload of fun to watch last year while we were all at home in sweatpants. And honestly, I still laugh every time I read their "about community" description on the front page. Source: https://www.reddit.com/r/wallstreetbets/ But what started last year as a smallish community of financial jokesters has grown to over 2.4 million so-called "degenerates."  With size comes purchasing power. And when that purchasing power knocks it out of the park, apparently you get written up in London's Financial Times. Congratulations, WSB… You have hit the mainstream. Since last October, total call option volume on GameStop Corp. (NYSE: GME) — as represented by the blue line in the chart below — has run up from around 10-11,000 per day to as much as 1 million on Friday. I mean look at this ridiculousness. Source: Bloomberg Back in October, I explained the mechanism by which large purchases of single-stock options can drive markets.  Basically, when a call option is issued to retail investors, the market maker has to go buy stocks as a hedge in case the shares get called away by the expiration date. How much they have to buy is based on how many standard deviations (or delta, in trader parlance) the strike price is from the current stock price, and how long until expiry.  The closer the expiry and the closer the option strike price, the more stock the market maker has to buy. And in the event those options in question happen to expire that day, and the stock in question happens to be the most shorted on the market, then those shorts are going to have to cover. Source: https://www.highshortinterest.com/ And yes, you're reading that right… There were more shares of GameStop borrowed and sold short than there were GameStop shares! That's when fireworks happen. If You're Keeping Score, That's Retail Army 2, Fund Bros 0 In this case, those fireworks blew up in the hands of one prominent hedge fund — Gabe Plotkin's Melvin Capital. Plotkin, whose fund had been returning roughly 30% per year until this month's slip-up, was down so much that hedge fund legends Ken Griffin and Steve Cohen (incidentally, his former boss) had to step in and bail him out. He wasn't the only one either.  Activist short seller Andrew Left's investment newsletter company Citron Research was absolutely pilloried online for its short call on GameStop. Some jokesters even tried to hack their Twitter account. Left himself, who is clearly big mad, felt compelled to post a rebuttal outlining why he's short. Literally zero points he makes are anything new. We know malls are in trouble. We know they were losing money and leveraged. We know eventually, gaming consoles will switch over to either subscription or downloads. But timing matters, and his clearly stinks. Is it going back to $20 like he says?  Yeah, probably… but with over 100% short interest remaining, there's a lot of potential to initiate another squeeze before the week is up. So You Wanna Be a YOLO Full disclosure, I bought a little back around $17 as a speculation and sold it at around $65 at close on Friday, after what I thought was the massive short unwind most analysts were expecting. But while that unwind is clearly not over, I just don't feel comfortable doing anything with it at these levels. And besides, there are other angles to take if we're going to look at the retail space. One of the most beaten-down sectors over the past year has been commercial real estate. SL Green Realty, a huge office REIT, is still down roughly 33% from its pre-coronavirus highs. Source: Bloomberg SLG has been on several investment newsletter lists as "a stock that could soar in 2021," but there's a zero percent chance I'm biting on commercial real estate until much later in the year. It is true, however, that as vaccinations continue to roll out and the weather gets warmer…we are probably headed back into the office. In turn, that means we probably won't be able to wear sweat pants and slippers much longer. And while a whole bunch of retail/apparel stocks have run up over the past couple of months, there's one I like that has surprisingly remained down. Designer Brands Inc. (NYSE: DBI) is basically the old DSW footwear outlet. The company required a rebranding and ticker change a couple of years ago when it acquired Camuto Group, which included footwear and apparel brands such as Jessica Simpson, and Lucky. Since then, it hasn't really received much coverage in the analyst space (new tickers tend to do that), volume has declined, and it remains roughly 30% off its pre-COVID lows. Source: Bloomberg It did get a bit of a pop on Monday on big volume, because… drum roll please… shorts got squeezed! Source: Bloomberg Because of that, it jumped along with all the other high-short interest stocks, but it has quickly faded back to a level I feel comfortable picking up a ¼ stake. While it's true that basically, the company just sells dress shoes, we know demand for office apparel is absolutely going to rise in the next year.  Given that it has traded as low as roughly 2x earnings over the past year — compared to bargain-hunter retail peers like TJ Maxx and Ross Stores who trade closer to 25x — the upside value here is enormous. Source: Bloomberg Moreover, because it got absolutely annihilated during COVID, earnings expectations are abysmal… but the year-on-year revenue and profit comparisons are incredibly easy to beat. This was a $30-35 stock a few years ago before the acquisition, and there's no reason to assume it won't be again once we move past the pandemic.  Source: Bloomberg And if we happen to get a Reddit-fueled short squeeze in the meantime, then the sky's the limit. YOLO! All the best, Matt Warder The post GameStop Bulls Crushed Hedge Funds. This Stock Could Be Next appeared first on Wealthpress.

Stock Market Recap: Tuesday, Jan. 26, 2021 Posted: 26 Jan 2021 01:55 PM PST Wall Street was tentative throughout while trading in tight ranges as investors braced for a number of high-profile earnings and the start of the Federal Reserve's two-day policy meeting — and more in Tuesday's stock market recap.  The major indexes closed lower across the board with the Dow extending its losing streak to four sessions while the S&P managed to test a fresh intraday all-time high. Stock Market Recap The Nasdaq was down 0.1% after testing a low of 13,603. The Dow also slipped 0.1% following the intraday pullback to 30,921. The S&P 500 dipped 0.2% despite tagging a record high of 3,870. The Russell 2000 fell 0.6% with the midday low reaching 2,146. Communication Services and Real Estate led sector strength with gains of 1.4% and 1%, respectively. Energy and Materials were the weakest sectors after falling 2.1% and 1.4%. Stock Market Movers Shares of Beyond Meat Inc. (Nasdaq: BYND) jumped 17% after announcing a joint venture with PepsiCo Inc. (Nasdaq: PEP) to develop, produce and market innovative snack and beverage products made from plant-based protein. The joint venture will leverage Beyond Meat’s technology in plant-based ingredients and PepsiCo’s marketing and commercial capabilities to create and scale new snack and beverage products.  Stock Market Outlook  Boeing Co. (NYSE: BA) announces earnings ahead of Wednesday's opening bell and its results will have a major impact on the Dow as it is the eighth-most heavily weighted component in the index. The company is expected to report a loss of -$1.80 a share on revenue of $15.07 billion. The high estimate is at -$0.38 a share with the low forecast at -$3.52 a share and would equate to a $1.42 beat or a -$1.72 miss. The company beat forecasts in the past quarter by $1.13, while missing by -$2.25, -$0.09 and -$3.80 in the previous three quarters. There are 24 analysts that cover the stock with seven Strong Buy ratings, 12 Buys, five Hold recommendations. Global Economy From the global stock market recap, European markets settled higher. Germany’s DAX 30 rallied 1.7% and the Belgium20 rose 1%. France's CAC 40 gained 0.9% and the Stoxx 600 advanced 0.6%. The UK's FTSE 100 edged up 0.2%. Asian markets closed mostly lower as China/U.S. tensions weighed on sentiment. China said it will conduct military exercises in the South China Sea this week — days after a U.S. aircraft carrier was spotted in the disputed waters. Hong Kong’s Hang Seng sank 2.6% and South Korea's Kospi dropped 2.1%. China’s Shanghai tanked 1.5% and Japan's Nikkei fell 1%. Australia's S&P/ASX 200 added 0.4%. U.S. Economy Consumer confidence was up 2.2 points to 89.3 in January versus the -5.8 point drop to 87.1 in December. The strength was in the expectations component which improved to 92.5 after rising to 87 previously. The present situations index fell to 84.4 after plunging-18.7 points to 87.2 last month. The labor differential fell further to -3.2 following December’s -8.8 point drop to -1.9 previously. The one-year inflation gauge ticked down to 5.8% after rising to 6% in December. Chain store sales posted a -2% month-over-month decline in the week of Jan. 23, versus the -2.5% drop for the first two weeks of January. Compared to the same period last year, sales accelerated to a 2.7% year-over-year clip compared to the prior 2.2% rate. January sales are projected to rise 3.4% year-over-year, but decline -1.3% versus December. Stock Market Sentiment The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) fell for the first time in three sessions after tapping a low of $152.92. Current and upper support at $153-$152.50 was breached but held. A move below the latter would signal a retest towards $151.50-$151. Resistance is at $153.50-$154. Volatility Index The iPath S&P Vix Short-Term Futures (NYSEArca: VIX) had its two-session winning streak snapped following the intraday backtest to 22.55. Current and upper support at 23-22.50 was recovered. A close below the latter and the 50-day moving average would indicate a retest towards 21.50-21. Resistance is at 24-24.50. Stock Market Analysis The iShares Russell Growth 1000 ETF (NYSE: IWF) was down for the second time in six sessions despite tagging an intraday peak of $250.21. Current and lower resistance at $250-$250.50 was breached but held. A close above the latter and Monday's all-time peak at $250.70 would signal strength towards $251.50-$252. Support is at $248.50-$248 followed by $245.50-$245. RSI is showing signs of rolling over with key resistance at 70 holding. A move above this level would suggest additional strength towards 75-80 and overbought highs from early September. Support is at 65-60. Sector The Energy Select Sector SPDR Fund (NYSE: XLE) extended its losing streak to four sessions after tagging a low of $40.73. Key support at $41 was breached and failed to hold. Continued closes below this level would suggest additional weakness towards $40-$39.50 and the 50-day moving average. Resistance is at $42-$42.50. RSI remains in a downtrend with key support at 50 failing to hold. Continued closes below this level would signal weakness towards 45-40 and the early-November lows. Resistance is at 55-60. Check back after the closing bell for the most important news and numbers in the WealthPress stock market recap.  The post Stock Market Recap: Tuesday, Jan. 26, 2021 appeared first on Wealthpress.

5 Stocks That Could See a GameStop-Like Moon Shot Posted: 26 Jan 2021 01:44 PM PST Everyone is talking about how GameStop, a perennially beaten-down video game retailer, has rocketed to the moon… and back… and to the moon again on a short squeeze.   Folks, it's already been a wild week on Wall Street and we're not even halfway done yet! Heck, even Tesla CEO Elon Musk is getting in on the fun! Gamestonk!! https://t.co/RZtkDzAewJ — Elon Musk (@elonmusk) January 26, 2021 GameStop Corp. (NYSE: GME) is a favorite target among short sellers. And at the time I filmed this video, it had a short interest of 131%.  Short interest is a fairly simple formula where you take the number of shorted shares and divide by the number of shares outstanding. So say a stock has 1.5 million shorted shares and 10 million shares outstanding. The short interest would be 15%. The GameStop Short Squeeze Explained So there is a massive amount of shares in this GameStop short squeeze. And when you see a stock chart go parabolic — when the price goes straight up a huge amount — that's an indication the shorts are getting crushed.  Traders who are short on the stock then have to start aggressively buying shares to cover their positions — they're forced to buy — and this GameStop short squeeze example is among the best you will ever see.  And it will probably continue for a few more days, maybe even a couple of weeks.  Eventually its share price should fall back into its normal range, which is $18 to $20 for GME. Even if it drags on for weeks, you'd still see lower and lower highs than that initial moon shot because once a short is covered, there are less shorts out there. But while GME is a favorite among short sellers, it isn't the only one.  While news of the GameStop short squeeze has captivated Wall Street, which is great, here's the best part for you… I have five stocks I want to bring to your attention that also have high open interest. And they are tempting fate in similar fashion as GameStop, which means they could explode higher and deliver big gains to shareholders who get in before the short squeeze happens.  P.S. Life Is Unpredictable — Trophy Trades Are Not The stock market can be unpredictable… especially given today's social and political climate.  That's why you need a trading strategy that will net you consistent returns year after year — no matter what life throws your way.  That's where Trophy Trades can help.  This stress-free trading strategy allows you to capture more of a stock's gains without leaving large profits on the table. And it works even in the most turbulent of markets.  See for Yourself The post 5 Stocks That Could See a GameStop-Like Moon Shot appeared first on Wealthpress.

Don’t Get Burned: How to Be a Successful SPAC Trader Posted: 26 Jan 2021 11:31 AM PST Over the weekend, I explained what I look for when investing in a SPAC, or special purpose acquisition company.  SPACs are fascinating companies — and opportunities —  to follow. And just like traditional investments, you need a strong SPAC trading strategy.  The idea, of course, is to buy low and sell high. It always sounds easy enough… in theory.  But don't make the mistake others do in regard to a lot of SPACs on the market: Many of them are not investments. Not in the traditional sense at least.  Let me explain what I mean… SPAC Trading Strategy: Investing vs. Speculating WealthPress’ Jeff Yastine Investing in a SPAC has been all the rage the past year or so, and it's basically a pool of money in search of an acquisition deal. In fact, 2020 saw a record run of SPAC sponsors issuing initial public offerings, with four times as many popping up than in 2019.  Today I'd like to discuss more about your SPAC trading strategy… And how to recognize the crucial difference between speculating — hoping — that a SPAC will go higher versus traditional investing.  This is a classic mistake most newbies make when getting involved with a stock they think is going to go up — pure speculation. They buy too much and then it goes down. That's when it becomes an "investment" that many people choose to — or have to — hold until it comes back up.  This could take months or even years — just ask pot stock speculators left holding the bag the past couple of years.  In today's video, I dissect an old recommendation I made a couple of years ago in a SPAC that is up more than 100% since. Point being, don't make the mistake of getting into a dubious SPAC without much of a business underneath it.  So check out my short video and let's chat about my SPAC trading strategy. Then leave your thoughts in the comments below.  And as always, send your investing questions to jeff@yastine.com. Be sure to subscribe to my new YouTube channel. You can also follow me on Twitter and Facebook. P.S. Learn How to Trade Like a Wall Street Insider  Ever wonder why Wall Street always seems to be one step ahead of the average Joe?  It's because they have a ton of top-secret trading strategies that give them an edge over everyone else! And while their methods are usually kept under lock and key… former hedge fund insider Lance Ippolito has decided to pull back the curtain on Wall Street's best-kept market strategy.  Lance is getting ready to reveal how tracking something called a "Shadow Blitz" can help you predict which stocks are ready to explode… Handing you huge cash windfalls in as little as 24 hours! See Lance's Discovery for Yourself The post Don't Get Burned: How to Be a Successful SPAC Trader appeared first on Wealthpress.

What Is the Tunnel Trader Strategy? Everything You Need to Know Posted: 26 Jan 2021 11:21 AM PST This new strategy that helps you focus on what you're doing in the stock market is destined to give you tunnel vision. "Tunnel trading" a visual guide that can help you trade the futures market and can be used on any futures symbol. But we specifically like to use it on the E-minis. The strategy's end goal is to exit the position with profit — for now let's not focus on the amount of profit. Your trading chart is going to have four lines on it: One blue (your automatic exit for profit), two green (where you strategically enter into the market) and one red (where to close out on your positions for a loss). These lines are going to become your best friends and identifiers on when you need to enter and leave your trades. Before we run head-on into that, we need to brush up on some basic information so that we don't trip along the way. The post What Is the Tunnel Trader Strategy? Everything You Need to Know appeared first on Wealthpress.

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