Markets, Yellen, Fed, gold, Tech stocks and bubbles
Well another week and Monday markets were up and all the bulls were running around predicting that the markets were headed higher. Sure enough we had a down week last week and Grandma Yellen's move to tighten is still being partially ignored by the markets. TLT or bonds were moving higher with yields moving down. We like TLT and have been long since 120. Check the chart here:
There was a heavy rotation into the biotech stocks this past week. The move in the biotech ETFs such as XBI, IBB and BIB were excellent and look like weekly breakouts. We expect these to move higher based on their weekly chart patterns. Check these charts below and we would expect a pullback before we would take any long positions.
Weekly charts:
Weekly charts:
We believe the rotation is coming out of tech stocks and moving into alternate investments that have been lagging. There is no question that we are in a bubble mode for all assets - the question is, when will this bubble burst. Over 90% of the tech stocks are trading at ridiculous PEs and valuations (that are above the 2000 stock bubble).
Even with Fed tightening, central banks around the world are still in easing and loose monetary policy mode.
Gold has been bouncing around this level between 1200 - 1330 for quite some time. Technicals are negative and we have to see a decisive break above the weekly moving averages of 13, 50 and 100 to turn bullish. We do not see that happening unless there is a monetary crisis a.k.a China Yuan or some other country currency crashing.
In the tech stocks we like, QCOM and WDC. These stocks relative to their peers are cheap and have good dividends and low PEs. We also like Alibaba - BABA, TWTR (if weekly close above $19.5) and would short NVDA. Please keep tight stops at 5% below 50d SMA or 20 week SMA. You can find these values on our site when you plot the charts on the www.trucharts.com/stockcharts.aspx page.
We have added new features such as customizable multiple screener for various technical signals on our site under "Screener" menu option - check it out.
We have video tours of our site on how to use the site effectively - please do check it out.
We have a discounted subscriber pricing which is at $10 per month or $120 annually. Please check this out on our subscriber page.
Good luck trading.
B. Bhatia
Founder/CEO - Trucharts.com
Even with Fed tightening, central banks around the world are still in easing and loose monetary policy mode.
Gold has been bouncing around this level between 1200 - 1330 for quite some time. Technicals are negative and we have to see a decisive break above the weekly moving averages of 13, 50 and 100 to turn bullish. We do not see that happening unless there is a monetary crisis a.k.a China Yuan or some other country currency crashing.
In the tech stocks we like, QCOM and WDC. These stocks relative to their peers are cheap and have good dividends and low PEs. We also like Alibaba - BABA, TWTR (if weekly close above $19.5) and would short NVDA. Please keep tight stops at 5% below 50d SMA or 20 week SMA. You can find these values on our site when you plot the charts on the www.trucharts.com/stockcharts.aspx page.
We have added new features such as customizable multiple screener for various technical signals on our site under "Screener" menu option - check it out.
We have video tours of our site on how to use the site effectively - please do check it out.
We have a discounted subscriber pricing which is at $10 per month or $120 annually. Please check this out on our subscriber page.
Good luck trading.
B. Bhatia
Founder/CEO - Trucharts.com
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