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Critical Put-Call Levels You Need To See TODAY

Posted: 05 Feb 2021 07:09 AM PST

We'd usually jump feet first into a stock market update and analysis around this time of day. But today, I thought I'd start off with something interesting I found. 

Let's take a look at the put-call ratio…

The put-call ratio gauges the trading volume of put options to call options in the market. Whenever the put-call ratio is above 1 (more puts than calls), like we saw last October, it means investors are increasingly fearful and that put buying is increasing. 

But over the past four months, sentiment has been moving toward calls, which means the recent fear level is now lower. 

 

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The post Critical Put-Call Levels You Need To See TODAY appeared first on Wealthpress.

Stock Market Recap: Thursday, Feb. 4, 2021

Posted: 04 Feb 2021 01:49 PM PST

Wall Street showed continued momentum for the fourth straight session as the focus turned back to fundamentals after last week's focus on short-interest stocks — and more in Thursday's stock market recap. 

Talks of a hefty stimulus from Washington look increasingly likely while moderation in the spread of the virus and lockdowns also helped fuel the bullish sentiment.

Stock Market Recap

The Russell 2000 rallied 2% after closing at a record peak of 2,202.

stock market recap

The Nasdaq jumped 1.2% while trading to an intraday record high of 13,778.

stock market recap

The Dow rose 1.1% following the late-day push to 31,065.

stock market recap

The S&P 500 was up by 1.1% with the lifetime high reaching 3,872 ahead of the close.

stock market recap

Financials and Technology led sector strength after gaining 2.2% and 1.6%, respectively. Materials were the only sector that showed weakness after falling 0.4%.

Stock Market Movers

Shares of Canada Goose Holdings Inc. (NYSE: GOOS) rallied 22% after announcing earnings. The company reported a quarterly profit of $1.01 a share on revenue of $474 million. Forecasts were for a profit of $1.08 a share on revenue of $452 million. 

CEO Dani Reiss stated the global strength of its brand and digital business has returned Canada Goose to growth in their biggest quarter. She also added its brand HUMANATURE was rapidly advancing the company's sustainability and purpose-based commitments.

stock market recap

Stock Market Outlook 

The AAII Sentiment Survey revealed bullish sentiment closed at 37.4% last week. Optimism was below its historical average of 38.5% for the second straight week.

Neutral sentiment was at 27% and below its historical average of 30.5% for the fourth straight week.

Bearish sentiment was seen at 35.6%. Pessimism was above its historical average of 31% for the fourth straight week.

Global Economy

From the global stock market recap, European markets closed mostly higher.

Germany’s DAX 30 rose 0.9% and the Belgium20 was up 0.7%. France's CAC 40 gained 0.8% and the Stoxx 600 advanced 0.6%. UK's FTSE 100 dipped 0.1%. 

Asian markets were weak across the board. 

South Korea's Kospi dropped 1.4% and Japan's Nikkei was down 1.1%. 

Australia's S&P/ASX 200 fell 0.9% and Hong Kong’s Hang Seng declined 0.7%. China’s Shanghai was off 0.4%. 

U.S. Economy

Initial Jobless Claims declined -33,000 to 779,000 after dropping -63,000 to 812,000 in the prior week. The four-week moving average slipped to 848,240 versus 849,000 previously. Continuing claims dropped -193,000 to 4,592,000 after slumping -190,000 to 4,785,000 previously.

Challenger announced layoffs rose 2,500 to 79,000 in January after rising 12,200 to 77,000 in December. The 12-month pace slowed to 17.4% year-over-year. Job cuts were led by the Aerospace/defense industry. Announced hirings declined -5,200 to 72,100 in January following the -108,200 plunge in December to 77,300.

Stock Market Sentiment

The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) extended its losing streak to three sessions with the intraday low hitting $148.80. Prior and upper support from last March at $149-$148.50 was breached but held. A move below the latter reopens downside risk towards $148.50-$148 and levels from last March.

Lowered resistance is at $149.50-$150 followed by $151-$151.50.

stock market recap

Volatility Index

The iPath S&P Vix Short-Term Futures (NYSEArca: VIX) fell for the fourth straight session with the late-day low kissing 21.68. Prior and upper support at 22-21.50 was recovered. A close below the latter would indicate a retest towards 20.50-20 with the late-November low at 19.51.

Lowered resistance is at 23-23.50 and the 50-day moving average.

stock market recap

Stock Market Analysis

The iShares Russell Growth 1000 ETF (NYSE: IWF) was up for the third time in four sessions after tagging a high of $250.46 just ahead of the closing bell. Current and lower resistance at $250-$250.50 was reclaimed. A close above the latter and the recent all-time peak at $250.70 would signal a possible breakout towards $252-$252.50.

Rising support is at $249-$248.50 followed by $247.50-$247.

RSI is curling higher after clearing and holding key resistance at 60. Continued closes above this level would suggest additional strength towards 65-70. Support is at 55-50.

stock market recap

Sector

The Real Estate Select Sector SPDR Fund (NYSE: XLRE) rebounded with the morning peak reaching $38.04. Key resistance at $38 was breached but held. A close above this level would suggest additional strength towards $38.25-$38.50 and the early November highs.

Support is at $37.50-$37.25.

RSI is back in a slight uptrend with multi-month resistance at 65 holding. A move above this level would indicate strength towards 70 and the high from early June. Support is at 60-55.

stock market recap

Check back after the closing bell for the most important news and numbers in the WealthPress stock market recap. 

The post Stock Market Recap: Thursday, Feb. 4, 2021 appeared first on Wealthpress.

Silver Short Squeeze 2021: Pump and Dump?

Posted: 04 Feb 2021 12:45 PM PST

Silver was floating around in the financial media last weekend — mentioned on the radio, news channels and the newspaper — generally being hyped up to investors.

Why?

People are coming off their GameStop adrenaline high and looking for their next fix. There's a worldwide guessing game underway to figure out what stock will be the next GameStop

Currently, there are a lot of rumors that the WallStreetBets group on Reddit is targeting silver for the next big short squeeze trade.

This interest in silver became even more intense when the iShares Silver Trust (NYSEArca: SLV) recorded the highest amount of volume in its history last Friday.

But even though silver spiked higher to $30 on Monday, prices sold off quickly…

Here's why this was a classic pump and dump by the big boys on Wall Street.

The post Silver Short Squeeze 2021: Pump and Dump? appeared first on Wealthpress.

Gold Is Crashing… Time To Buy a Little?

Posted: 04 Feb 2021 12:07 PM PST

Weekly unemployment data was released this morning that — although still kind of awful — managed to beat expectations. Initial claims fell to 779k (vs 830k expected), and continuing claims dropped to 4.6 million, which is the lowest point since before the COVID-19 outbreak.

Source: Bloomberg

And while the total number of persons collecting some form of unemployment insurance did fall by nearly half a million people, 17.8 million folks out of work is still… Well, it's bad.

Source: US Department of Labor

Nevertheless, the resulting optimism sent both the US Dollar and interest rates higher in the morning. 

And since gold prices have been negatively correlated with both instruments of late, we're now seeing some capitulation there, with prices well down below $1,800 per troy ounce.

Source: Bloomberg

The line in the sand that we need to pay attention to is the Nov. 30 low at $1,762.30 per oz. 

Should that level break, that would mark a new low, meaning the yellow metal's six-month bearish trend will remain intact.

Image

Source: Bloomberg

That means that if you've been wanting to pick up shares of any gold stocks on our Christmas List, today is not a bad day at all to do so.

Those 5 – Newmont Corp. (NYSE: NEM), Barrick Gold Corp. (NYSE: GOLD), Agnico Eagle Mines Ltd (NYSE: AEM), Kirkland Lake Gold Ltd (NYSE: KL) and B2Gold Corp. (NYSE: BTG) — have all been beaten down into ranges where they look fairly attractive.

One caveat though — I'm not buying at scale.

All of these companies report over the next two weeks. And although earnings expectations are more modest than in Q3 — not to mention they are all literally printing money as they progress through operational plans — there is still some risk for gold prices if the broader stock market remains red hot.

The first one to report is Agnico Eagle next Thursday. 

Last quarter's earnings report posted 78 cents per share (versus a consensus estimate of $0.67) on the back of a record realized gold price of $1,911 per ounce.

Average gold prices declined by 2% in Q4, and while that's going to pare back performance a little, the consensus estimate is actually a little lower than last time.

Source: Bloomberg

My estimate (74 cents per share) has them beating that expectation handily, but again, I suspect share performance will have more to do with gold price performance than with fundamentals this time around.

Picking up a speculative 0.25 tranche in ProShares Ultra Gold (NYSEArca: UGL) does make some sense here, as it's back down near last year's support levels. 

The idea on this speculation would be to sell any gold-price rip back above $1,800, while using a tight trailing stop around the 5% level in case the bottom falls out.

Then, I'll watch Agnico Eagle's earnings next week for clues as to how the others on our list will perform.

Keep in mind, as bad as economic data actually was today, the fact that it exceeded expectations is what's pushing the dollar and interest rates higher.

And those year-on-year comparisons only get easier from here through the summer. 

That's because this time around, we'll be comparing a growing economy this year to one that was essentially on lockdown in 2020. And that creates huge distortions in the data.

Economists call these distortions "base effects". And while the distortions will look positive through June, the rate of change of US GDP growth will almost certainly slow over the back half of the year.

Especially so if unemployment proves to be sticky.

When that happens, the talking heads on TV won't be talking about GameStop.

Instead, they'll be begging to stop the game.

That… is when you need to own gold.

All the best,

Matt Warder

The post Gold Is Crashing… Time To Buy a Little? appeared first on Wealthpress.

WPTV: GameStop vs. Robinhood — All You Need to Know

Posted: 04 Feb 2021 11:39 AM PST

You've read about it in the papers, you've heard about it on the news and now WPTV brings you our fresh perspective on what has become one of the biggest stories of 2021.

We're talking about GameStop and Robinhood, of course, and how investors are now trying to corner the silver market in a desperate move to finance the next GameStop stock.

Future of Wealth founder Lance Ippolito — an expert when it comes to calling B.S. on Wall Street elites — says he sees how this could be changing everything we know about the stock market and bring about a new wave of trading. 

While seeing huge short-sellers like Melvin Capital being run over by redditors does make the 99% cheer…

Will this turn out to be a good thing for the future of trading… or a bad thing?

The post WPTV: GameStop vs. Robinhood — All You Need to Know appeared first on Wealthpress.
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