Big Tech Eats the World

May 02, 2021 | How to Swing Trade earnings and what to look for in reports

Weekly Newsletter - Week of 5.2.2021

Earnings Dominate Market Sentiment 

Last week, the market was dominated by one of the busiest earnings schedules in recent memory. Mega-Cap juggernauts; Tesla, Google, Microsoft, Shopify, Amazon and Facebook all reported earnings, along with many other important companies. 

Who Were the Biggest Winners from the Busy Week of Earnings? 

Companies who can position themselves as benefactors from the great reopening- that’s what Wall Street cares about right now. What companies are going to benefit the most from a reopening economy bustling with pent-up demand? Thus, Google, Amazon and Facebook all set new highs last week. Why? Each of these companies generate a bulk of their revenue through advertising. 

Advertising is set to boom over the upcoming quarters. If you feel like you’ve seen a lot of the same companies dominating advertising over the last year, it’s because you have. But as more companies reopen their doors, so does their need to generate meaningful growth through advertising. With a monopoly on the advertising game, big-tech companies should continue their winning ways. 

Conversely, high-multiple growth stocks like Tesla, continue to have difficulty gaining momentum with Wall Street. Yet Microsoft and Apple each had blow out quarters when they reported earnings. Apple specifically put up some truly jaw dropping numbers that any investor should’ve been happy to see. But alas, both Apple and Microsoft have mostly been treading water since they reported- any pullback might be a good chance to increase exposure. 

Weekly Swing Trades

PNRG (Prime Energy)

October 2, 2022

Entry Price:

80.62

Stop Price:

76.85

Target Price:

88.04

Time Frame:

1 Week Hold

Expecting a short-term bump after a recent OPEC+ announcement regarding the a supply constraint to oil. The constraint would result in ~1M less barrels of oil per day, which should cause a price jump. Low RSI and bouncing off our 250 day moving average, both hallmarks of a good swing trade.

DV (Doubleverify)

October 2, 2022

Entry Price:

27.75

Stop Price:

26.75

Target Price:

29.00

Time Frame:

3 Week Hold

Using our moving averages heavily on this swing trade, look for continued strength as we try to notch out a 6-8% gain. Specifically, we are taking advantage of of a recent cross over in the 50 day moving average. Last week closed down, so wait for confirmation of a reversal.

Surging Price of Commodities

The other big news fueling the stock market is the also tied to the great reopening! Commodity prices are soaring and here’s why. Many companies in the world were forced to slow down or even halt production due to the issues caused by the global pandemic. 

Now as countries begin to open, those same companies are doing their best to ramp up and meet an ever-increasing demand for their services. More and more companies are bidding on the same scare resources, thus the prices for those commodities are rapidly appreciating. Keep an eye out for any price increases for some of your own favorite items. As businesses are forced to spend more to make their products, these additional production costs are almost certain to be passed on to the consumer. Thus, fueling the fire of inflation concerns even further. 

Finally, don’t forget about the boom in the housing market. New home builds and initiatives like the heavily discussed “Infrastructure Bill” are sure to keep commodity prices sky-high for the foreseeable future. 

Upcoming Economic Reports

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Weekly Watchlists

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Weekly Review

Market Performance- Week of 09.25.2022

Recent Winners

SBUX (Starbucks)

SBUX (Starbucks)

Entry Price:

85.00

September 11, 2022

Price at High:

89.90

Return for Members:

5.76%

Timeline:

2 Month Hold

Strong momentum over the last few weeks. Watch for a mean reversion, but if moving averages stay consistent look for an early play to open the week.

PNRG (Prime Energy Resources)

PNRG (Prime Energy Resources)

Entry Price:

83.20

September 4, 2022

Price at High:

100.00

Return for Members:

20.19%

Timeline:

3 Week Hold

PNRG had a drawdown to historical levels of support (around the 100 day moving average). Looking to make an entry in the coming days as we also have macro tailwinds with the energy crisis in Europe.

PYPL (Paypal)

PYPL (Paypal)

Entry Price:

87.00

August 28, 2022

Price at High:

103.00

Return for Members:

18.39%

Timeline:

4 Week Hold

Playing off the dip in June, we're starting to see momentum as the 50MA is crossing over the long-term averages. Look to for momentum to continue and an early entry on Monday.

Recent Watchlist Winners

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