This was a relatively uneventful week in the markets as the S&P 500 (ES) and Nasdaq (NQ) generally traded sideways. While this choppiness could feel somewhat boring, the daily squeezes in the indexes still have a bullish structure to them. As long as both indices hold this structure, we will continue to be patient and look for long opportunities in this market. The trend is your friend… until the trend changes.
As for the market sectors where we are currently focusing, the semiconductors rose nicely this week but we think there is plenty of room to the upside. We are still long Broadcom (AVGO) and we nailed a trade on Nvidia (NVDA) for a quick profit this week. If we get any dip in the semiconductor group next week we will likely look to add more exposure in the chipmakers.
As for technology, should the group make another move to the upside we think Apple (AAPL) is poised to pop based on its bullish daily squeeze (chart below). Google (GOOGL), despite having no daily squeeze, offers a handful of bullish squeezes on the lower time frames that we will be watching closely.
After weeks of consolidation the financial sector finally woke up this afternoon. The weekly squeeze looks incredibly bullish and could offer the potential for weeks of solid momentum. However, after today’s big move we suggest waiting for the next pull back before diving in. In the Compounding Growth Mastery we sold a put credit spread on Goldman Sachs (GS) yesterday afternoon and bought it back today for a nice profit as it quickly ran into our target. We will happily look for another entry on the next dip.
The structure of the indexes continues to be solid. These are some pockets of the market that could offer great opportunities if the bullish nature of the market continues. There are a few additional stocks on our watchlist where we are looking to buy the dip and we will be covering those in detail in this Sunday’s watchlist video. Enjoy some relaxation this weekend because it’s back to the grind on Monday! We’ll talk to you on Sunday!
Stay Focused!