Weekender for 1/14/2024
1. Market Summary
- Consumer Price Index (CPI) hotter overall, cooler Core, but key areas return to rising as food hits record highs. All is well.
- Citi warns the day before earnings the Venezuelan peso may cause Citi to miss its results.
- Indices sell, but post strong afternoon recoveries.
- Positioning not changed, but the intraday action was solid.
- U.S. December spending increases 50+% year/year. Elections are coming, after all.
- Futures down modestly as U.S./United Kingdom attack Houthi targets.
- Producer Price Index (PPI) on CPI’s heels rounds out the 2023 inflation picture
- Nasdaq big names are holding the indices higher. That buys time for the market, but other sectors need to break out as well.
A hotter-than-hoped CPI knocked stocks back on their heels after some early premarket gains. The indices, however, did a very credible job of stiffening the upper lip around the European close, recovering most of the lost ground and indeed even ticking positive by the close. The action still is not a clear reversal back into rally mode, but stocks ticked off one major economic data point and survived.
Now it is time to face the bank earnings premarket Friday, an early earnings season ritual that may have more intrigue after Citi warned this morning (thanks for the heads up with so much time ahead of earnings …) its quarter “may” be lower thanks to, of all things, the Venezuelan peso. Seriously? The Venezuelan peso has that much influence on Citi’s earnings? Better call in the Federal Deposit Insurance Corporation (FDIC) and Federal Reserve — yeah, sure.
NOTE: The figures and facts above are from the 1/11 report.
MARKET VIDEOS
MARKET SUMMARY
TECHNICAL SUMMARY
NOTE: The videos are from the 1/10 report.
2. Targets Hit
Investment House Daily:
ProShares Bitcoin Strategy ETF (NYSEARCA: BITO): With the Bitcoin spot exchange-traded fund (ETF) on the cusp of Securities and Exchange Commission (SEC) approval, the cryptocurrency area was active on the week. Indeed, BTC continues trading well along with the other currencies.
Even though everyone knew the approval was made and trading would start Thursday, when the trade did start, these stocks popped. It was not for the entire session, however. We figured the gap on the open would not last — again, it was known information and was just a rah-rah move. Thus, we banked some more gain on our positions, banking a 33% gain in our BITO position.
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Rapid Profits Stock Trader:
TMC the metals company Inc. (NASDAQ: TMC): Steel stocks have performed well for many months, but not all move at the same time. TMC had that big surge in the summer of 2023 that we traded, but after such an outsized move, when it topped, it needed a long period of recovery and consolidation. It took it.
We watched it all the way, and, in November and December, noticed the potential for developing an inverted head-and-shoulders pattern. Sure enough it did, breaking higher early 2024. We were able to enter on that move, playing stock positions on this low-priced stock. This past week, after a nice break higher, we banked 26% on one position and 12% on another.
TMC is now testing, and we want to move in if it can hold its near support and make a new break higher, continuing the breakout. Why? These big bases set a good foundation for protracted advances — meaning it makes us a lot of money.
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3. Covered Call Options Play
LendingClub Corp. (NYSE: LC) — LendingClub Corp. is currently trading at $8.61. The Feb. 16 $9 calls (LC20240216C00009000) are currently trading at $0.50. That provides a return of about 11% if LC is above $9 by the expiration.
