5/17/22 Breather Day, Buffett’s Buying

News:

Stocks ended Monday mixed. The Dow rose 0.1% while the Nasdaq fell 1.2%.

Overall more stocks declined than advanced. But the pause in momentum was met with lower volatility.

The leading sector was energy again. The market is pricing in a full reopening of Shanghai. The city reported “three consecutive days with no new COVID-19 cases.”

Consumer discretionary was the weakest sector as investors see inflation as the biggest threat to the economy at the moment.

Warren Buffett’s Berkshire Hathaway has been buying stocks as the market falls. Notably, adding to its positions in Chevron (CVX) and Occidental Petroleum (OXY). The Wall Street Journal described the purchases as a “spending spree.”

Technicals:

Most indicators are neutral. The VIX broke its uptrend and now appears to be favoring the bulls.


VIX Daily Candles – Chart via thinkorswim

Futures are up this morning. A day of gains following yesterday’s breather is a sign of strength in the overall market.

Timing:

It’s a slow week for economic data and reporting.

I’m watching earning plays for any surprises.

I believe the worst of the selling is behind us. But summer months are traditionally slower so I’m not betting on any huge rally.

The current market dip is a great buying opportunity in my opinion. So long has your hold time is several months long.

Watchlist:

*Low Float
^Open Position

*UONE has support at $10
TNK has support at $17
TRMD
is on watch
HDSN
has resistance at $9.50
LPG has support at $15
TDW has support at $24
GFF is on watch
VTNR has support at $12
R has resistance at $85
VERU has support at $14
BORR has resistance at $5
STKL is on watch
LIDR has resistance at $6
FRGE is on watch
HRB is on watch
UNM has support at $34

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