Momentum Monday – Go Big and The Financials Wobble

It’s Monday, which means Ivanhoff and I put together our weekly ‘Momentum Monday’. You can click here to watch and I have embedded it at the end of the post.

As a reminder, Marketsmith (by Investor’s Business Daily) is now a sponsor of the weekly show. All the charts you have been seeing in the videos and will continue to see are from Marketsmith. They are offering my readers a three week trial for $19.95. Click this link if you would like to try it out.

The quick summary:

We continue to trade in a market of stocks environment. While the small-cap index, Russell 2000 (IWM) is struggling under its 50-day moving average and financials are sliding despite rising interest rates, large-cap techs are within a striking distance of new all-time highs. During the episode we go over some stocks that are holding well like Boeing ($BA), Disney (I am long $DIS), Apple (long) and Amazon (long). We discuss the price action in financials, Chinese stocks and a few stocks our momentum list.

I think the double whammy hitting financial stocks is really interesting. The Fintech explosion has and still is creating competitors that once upon a time seemed like silly features. The product geeks call these ‘wedges’. On top of the assault, the financial stocks are likely being sold as the spread narrows between short and long-term interest rates.

The startups are lean and the new leaders have acquired millions of new accounts and are building stong, trusted brands amongst millennials and Gen-z’s.

I sound like a broken record on fintech after 12 years investing in the startups, but seeing Stripe, Venmo (Paypal), Square, Etoro, Coinbase, Chime, Robinhood now grow effortlessly and relentlessly while seeing banks now do the copying is fun to watch.

The large cap technology and healthcare companies continue lead the all-time high list.

Here is a good look at the small cap underperfromace of late.

And here is today’s episode:

PS – Ivanhoff is out with a new book for people that want to do as we do and swing trade, but use options.

Also published on Medium.