Special Offer: Try the 'Tradespoon LIVE Membership' for ONLY $37!
CLICK HERE TO LEARN MORE
RoboStreet – December 17, 2020
Tech-Led Santa Claus Rally In Full Stride
The big-cap tech sector has re-emerged as a torchbearer for the year-end rally that is underway as of this past Monday. Following a textbook set up the week the second week of December, FAANG, MAGA, semis, and SasS stocks have asserted themselves as the holiday darlings that investors are piling into.
In doing so, the S&P and Nasdaq are leading the charge higher and in turn, setting new all-time highs along the way. There is also strong movement in commodities against a weaker dollar with gold and silver have bottomed and now back up and trading higher after testing key technical support levels.
And remember we’re not talking about day-trading here. I’m looking for 50-100% gains inside of the next 3 months, so my weekly updates are timely enough for you to act.
Bitcoin is trading as a hot alternative to gold, called “digital gold” by somewhere this leading cryptocurrency cleared $23,000 this week in a flurry of buying. And lastly, today will see the S&P 500 rebalance and add a few new stocks to the index that include Tesla Inc. (TSLA), American Electric Power Co. (AEP), Marvell Technology Group (MRVL), Match Group (MTCH), Okta Inc. (OKTA), Peloton Interactive (PTON) and Atlassian Corp. (TEAM).
The six companies being removed are BioMarin Pharmaceutical (BMRN), Citrix Systems (CTXS), Expedia Group (EXPE), Liberty Global (LBTYA) Take-Two Interactive Software (TTWO), and Ulta Beauty (ULTA).
As far as the market’s technical condition is, the SPY continued to trade in the narrow range between $364 and $370 levels. AAPL, MSFT, AMZN, and work from home stocks staged an impressive rally.
The market can potentially have a shallow pullback back to the $364 level this week but I will use any short-term corrections to add to equity positions. $364 level is a key support level short term. I expect short term corrections to be shallow and the bull’s rally to continue.
As long as the SPY is trading above the $364 level, the SPY will break out from the current range to the upside and potentially can reach the $370-$385 level by the end of this year.
The U.S. Dollar ($DXY) is trading at a two-year low and U.S. Treasuries (TLT) continued to trade in the downward channel. GLD and SLV have started their bottoming process.
My opinion has not changed. The bull market has resumed its rally and will retest recent highs in December. Based on our models, the market (SPY) will trade in the range between $340 and $385 for the next 4 weeks.
With the fourth quarter historically being the strongest earnings quarter for technology companies, coupled with seasonal and strong weightings in the index and sector ETFs that boost the underlying share prices with bullish money flows into ETFs.
To capture the full essence of the big cap tech rally, one can buy the Technology Select Sector SPDR ETF (XLK) as a way to cast a net over the tech stocks that matter most.
When we apply our AI tools to XLK week see our models confirm our bullish take on the sector. Our Stock Forecast Toolbox has XLK rated a “Model Grade B” with a price target of $136,78 over the intermediate-term.
This kind of quantitative confirmation is how we select our stocks and ETFs within our RoboInvestor advisory service that has one of the hottest track records in the industry. Of the top holdings in XLK that has our attention this week is Microsoft Corp. (MSFT), which has been building a base for six months.
And remember we’re not talking about day-trading here. I’m looking for 50-100% gains inside of the next 3 months, so my weekly updates are timely enough for you to act.
*Please note: RoboStreet is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his own personal money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader, MonthlyTrader, or RoboInvestor recommendations. If you are interested in receiving Vlad’s personal picks, please click here.
Please share this Tradespoon Market Commentary with your friends.
Comments Off on
Tradespoon Tools make finding winning trades in minute as easy as 1-2-3.
Our simple 3 step approach has resulted in an average return of almost 20% per trade!
