This week, the market displayed increased strength in growth stocks, the best sign there is to gauge market health. Of the thousands of indicators out there, nothing beats monitoring the action of leading stocks. I've found I've make the best decisions when I let the action of my portfolio guide me. Let's take a look at how some of the positions are doing.
BEEM continues higher and was up 34% this week. MRNA also continued higher on positive vaccine news. I opened a position in Tesla which looks like it is set to go on another strong move higher. Plug Power similarly is in an uptrend.
Solar continues to be a hot sector which makes sense with the emergence of a Biden administration. SunPower is riding its 20-day upward, and I opened a position in recent IPO ARRY which is also another solar play.
I've noticed lots of strength in IPOs over the last month, specifically in Palantir (PLTR). Unity is also waking up and highly-shorted ZI is forming a inverse head and shoulders bottoming pattern. Gaming stock CRSR also had a fantastic week. It reached my profit target so I sold half with the intention of holding my remaining shares for a potentially larger gain.
Chinese stock FUTU is gaining strength while NIO is approaching $50. Sometimes, I feel foolish for selling it around $40, but the game is to make money, not to sell at the exact top. BIDU had a rough week, but is still holding above its' 50-day moving average. JOYY (YY) saw a sharp decline this week, illustrating the dangers of blindly buying and holding a position without a stop loss.
Bitcoin continues its torrent run higher, approaching $19,000 as of this writing. I continue to hold my position in Bitcoin and GBTC. Although this one is due for a reaction in the short-term, I still like it long-term as the weekly chart shows it has just emerged from a multi-year base. These types of bases offer enormous potential. As Jesse Livermore would say, "It is the big swing that makes the big money for you."
I also opened positions in Salesforce, BLDP, and EXPI this week. Salesforce (CRM) is currently a losing position. If I get stopped out, I'll take my loss and move on. BLDP is starting to gain some traction after consolidating over the past four months. EXPI is a mixed bag for me. I love the daily chart which its' clear support at $40 and the heavy volume retake of the 50-day moving average. However, the weekly chart may need some work. I felt the risk to reward was worth it based on the action Friday. We'll see where this ones goes.
From a seasonality point of view, it wouldn't surprise me to see some consolidation this week as the country celebrates Thanksgiving. After that, it is looking like the market will end the year with a strong December, which is usually one of the better performing months for the stock market.
The amount of excessive bullishness in the market is somewhat concerning to me. My ideal scenario is when my portfolio is acting well, stocks are breaking out, and there is a cloud of negativity looming over the market. That is a recipe for making money and is what we saw in April of this year. However, I never make trades purely off of sentiment indicators, as bull markets can run farther and longer than most can imagine.
Apple and AMD are both stocks currently on my watchlist. I will be looking to enter into one or both of these in the future. I really like the way these two have been consolidating over the past few weeks.
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Full Disclosure: I currently own many of the stock mentioned in this post.
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