๐ Market Soars on Strong Jobs Data, But Rising Yields Pose Challenge ๐
A surprisingly robust September jobs report sent shockwaves through Wall Street, propelling the Dow Jones Industrial Average to a fresh record high. This impressive performance underscores the continued strength of the US economy but also throws a wrench in expectations for aggressive interest rate cuts by the Federal Reserve. The strong jobs numbers suggest the economy may not need as much support from the Fed, leading to a surge in Treasury yields. This creates a complex dynamic for investors, balancing the positives of economic growth against the potential headwinds of rising interest rates.
Despite the upward pressure on yields, the stock market rallied, demonstrating resilience and a "buy-the-dip" mentality. Key sectors like technology and consumer discretionary led the charge, showcasing investor confidence in continued growth.
We'll dissect the implications of this data and explore potential investment opportunities in this evolving landscape.
๐ข High-Volatility Thrill Rides ๐ข
LUNR (Intuitive Machines, Inc.)
What they do: Intuitive Machines is a space exploration company that designs, manufactures, and operates lunar landers and orbital transfer vehicles.
Why watch? ๐๐ Big NASA contract secured in September. The 10 and 20 EMA are trending upwards nicely, forming a falling wedge on the daily chart. The space theme may regain investor interest in the coming weeks.
RMTI (Rockwell Medical, Inc.)
What they do: Rockwell Medical is a biopharmaceutical company focusing on developing and commercializing therapies for patients with anemia, dialysis, and IV iron delivery.
Why watch? ๐๐ Fundamentals are improving, and technicals are following suit. A falling wedge is forming on the daily chart, slightly below the 10 and 20 EMA. A break above the wedge could push the stock over these moving averages, potentially turning the outlook bullish.
SYM (Symbotic Inc.)
What they do: Symbotic is a robotics and automation company that designs, builds, and installs automated storage and retrieval systems for retailers and wholesalers.
Why watch? ๐ค๐น The stock shows improving fundamentals, with analyst projections indicating strong growth in upcoming quarters. Technicals are also promising, with a cup and handle formation on the daily chart. The $22.64 weekly support level has been tested twice in two weeks, suggesting a potential base.
CELH (Celsius Holdings, Inc.)
What they do: Celsius Holdings produces and distributes functional calorie-burning fitness beverages.
Why watch? ๐ฅค๐ Similar to Boeing (BA, in our Portfolio actually), negative news may already be priced into the stock. We're watching for a potential upside break of the falling wedge, which could signal a bounce play.
๐โโ๏ธ Medium-Risk Wave Riders ๐โโ๏ธ
BZFD (BuzzFeed, Inc.)
What they do: BuzzFeed is a digital media company known for its news and entertainment content.
Why watch? ๐ฐ๐ Significant consolidation since May, with positive last quarter earnings. Signs of a turnaround in both the company and the stock are emerging. The 10, 20, and 50 EMA are stacked, supporting the stock. Recent weeks have seen very low volatility and volume.
AFRM (Affirm Holdings, Inc.)
What they do: Affirm is a financial technology company offering installment loans to consumers at the point of sale.
Why watch? ๐ณ๐ Strong earnings reported at the end of August. The stock is now finding support at the weekly $38 level. If the broader market trends upward, there's potential for a bounce play with a two-dollar risk.
DUOL (Duolingo, Inc.)
What they do: Duolingo is an education technology company that produces language-learning apps and provides language certification.
Why watch? ๐ฃ๏ธ๐ฑ Solid stock with strong financials. After an impressive 100% run since early August, it's now consolidating within a pennant formation. We're anticipating a potential breakout after a few more days of sideways movement.
CART (Maplebear Inc. dba Instacart)
What they do: Instacart is a grocery delivery and pick-up service.
Why watch? ๐๐ Recent IPO with $43 as the all-time high. A pennant is forming on the daily chart. The stock found support on the 20 EMA last week, and more recently on the 10 EMA, suggesting building strength.
CVGW (Calavo Growers, Inc.)
What they do: Calavo Growers is a global avocado-industry leader and expanding provider of value-added fresh food.
Why watch? ๐ฅ๐ Good earnings were reported in September, accompanied by the highest trading volume in the last year on earnings day. The stock is flagging nicely on low volume, with the 10 and 20 EMA supporting its upward movement. These factors suggest the stock may be poised for a potential breakout.
๐ก๏ธ Low-Risk Safe Harbors ๐ก๏ธ
NVDA (NVIDIA Corporation)
What they do: NVIDIA is a technology company that designs graphics processing units (GPUs) for gaming and professional markets, as well as system on chip units (SoCs) for the mobile computing and automotive market.
Why watch? ๐ป๐ฎ The stock has been consolidating nicely since July and appears poised for a breakout. Before entering a position, confirm bullish trends in both the semiconductor sector and the Nasdaq. Ideally, both should be green and trending upward on the day of the breakout.
FTNT (Fortinet, Inc.)
What they do: Fortinet is a cybersecurity company that provides firewalls, anti-virus, intrusion prevention, and endpoint security.
Why watch? ๐๐ผ Operating in a strong sector, the stock has moved sideways since August following a positive earnings report. It's approaching a break of the weekly level, just shy of all-time highs.
GE (GE Aerospace)
What they do: GE Aerospace is an American aircraft company, which provides jet and turboprop engines, as well as integrated systems for commercial, military, business, and general aviation aircraft.
Why watch? ๐ญ๐ Trading near all-time highs, this strong stock has been in an uptrend since 2022. A break above the current pennant formation could potentially drive the stock to new all-time highs.
CVLT (Commvault Systems, Inc.)
What they do: Commvault Systems is a data protection and information management software company.
Why watch? ๐พ๐ Reported good earnings in August, followed by sideways movement forming a small inverse head and shoulders pattern. The 10 and 20 EMA are catching up, and the stock is nearing all-time highs above $157.
The four most dangerous words in investing are: 'This time it's different.'" - Sir John Templeton
thanks GBC.. another great watchlist for consideration, you're doing good work!