While I’m waiting for the market to fall apart J I want you show you two charts. The first chart is for Apple (AAPL) and the second chart is for Netflix. Apple has been bullish since earnings were released. Apple is hitting a 52-week high and has look of a stock that wants to run. It’s a leader.
Now look at Netflix (NFLX). This stock has been a laggard. So what has changed? Netflix bounced off the 200-day simple moving average and reclaimed the 50-day SMA during Monday’s session. That’s a big deal. The question is what should you do? Add these two names to your watch-list and stalk them.
Buying at this juncture in the market’s cycle is risky. Why? The Nasdaq is the lagging index. If market is going to trend higher, then the Nasdaq will have to do what Netflix did on Monday – retake the 50-day SMA. If the Nasdaq is going to do this both Apple and Netflix are going to play a critical role. Until the Nasdaq gives you the green light stay nimble. You can invest in both names once an uptrend begins.
In this current environment I’m partial to generating income using credit spreads vice being directional. That will change when the Nasdaq changes re-takes the 50-day SMA.
If you want to come into my office and trade with me send me an email. It would be a pleasure to meet, bond and commiserate together – tim.reazor@NorAmAsset.com
I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor
I hope today’s newsletter helped.
The information presented is for educational and entertainment purposes only. Opinions and information expressed are based upon information considered reliable. However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.
Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.
Investments involve risk and unless otherwise stated are not guaranteed.