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Good Monday morning everyone.
I will get right to it…here is this weeks Momentum Monday episode with Ivanhoff and I talking markets and momentum. We share a few new ideas – take a look at $JAMF (Apple has finally come for the Fortune 1000) and $EBAY (the long tail winner of collectibles boom) and let us not forget Tesla back at all-time highs. You can watch/listen to this weeks episode right here on Youtube. I have embedded the show below on my blog:
All I can think of right now is the massive liquidity in and around the markets.
I have to start with the Fat Nixon SPAC. The most interesting thing to me is the SEC’s Gary Gensler has spent months tweeting and threatening crypto but the SEC has nothing to say about a SPAC that made zero attempt at anything but a promote. The good news is that this is a reminder to the left that there are unintended consequences of the policies meant to rid the internet of someone. There will always be speculators, promoters and bankers willing to finance people like Trump. It is also a reminder that the SPAC is a GREAT feature of markets and here to stay despite the abuse. It is up to investors to beware because the SEC is outgunned by the people.
Over $500 billion has flowed into the hands of venture capitalists and founders this year alone from acquisitions/deals.
In the olden days of the internet that would be piled into Porsches and dungeons. Today that will go back into jet sharing services, homes, condos and more startups.
This ‘startup multiplier effect‘ combined with the massive late stage ‘speed investing’ by Softbank, Tiger and their clones is going to end one day of course, but NOBODY knows the trigger right now. Good luck telling a young cash rich founder and a Tiger investor that prices are high and future returns might not look so great.
The only good news for bears is that Web 2.0 overlords are in a bit of trouble…at least the stock prices. They are under distribution as the government, iOs 14 from Apple and Web 3.0 do their thing on the business models and attention.
Here are Ivanhoff’s cliff notes from the episode:
Earnings season is like war. Every war has its heroes and casualties. Just three months ago, Snapchat’s earnings inspired a rally in all stocks that derive their income from advertising. Last week, we saw the opposite. The new iOS privacy features are impacting social media companies and they will need some time to adjust to the new reality.
Other than the hiccup in ad-based businesses and the occasional fake breakout, the price action in the indexes has been mostly constructive. SPY is almost at all-time highs. The small-caps ETF – IWM, is making higher lows and setting up for a potential breakout. Inflation-sensitive sectors like Oil & gas, financials, metals continue to lead. Most software names are also holding remarkably well which is not typical for a rising interest rate environment – OKTA, TEAM, ZS, DDOG, U, SNOW, BILL, MDB, NOW, etc.
There’s a lot of speculative money that is not leaving the market. It’s just rotating. Just look at what happened with DWAC, PHUN, HX, SOLANA last week.
A big earnings week is ahead – all the FAANG stock report, plus Visa, Mastercard, Exxon, Shopify, Walmart, AMD, and more than 600 other stocks. There will be thousands of reports during the next 3-4 weeks. And while the meat of earnings season is typically a choppy period for the indexes as they digest all information, it is also a time of big opportunities. Many new leaders and losers will appear on the scene. Our job is to recognize them and hop on some new trends.
Here is the ‘Stocktwits Momentum 25 Lists‘ which is where I start my week looking for strength and catalysts and fresh ideas.
I am still in New York this week working.
Have a great week everyone.
Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. For full disclosures, click here.