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5/9/22 Bears, EVs, The Metaverse, and Bitcoin

News:

Last week we welcomed May and the beginning of the worst six months.

The Fed upped interest rates by 0.5%, as expected. It also dismissed the possibility of sharper rate hikes in the near future.

Jobs numbers we generally positive. New jobs are being created, new unemployment filings are low, and wages are growing … just not as fast as inflation.

The lockup period for EV maker Rivian Automotive (RIVN) has expired. CNBC, citing unnamed sources, says that Ford (F) and another unnamed investor are poised to offload millions of shares as soon as today.

Meta Platforms (FB) is scheduled to open its first brick-and-mortar store this week as it attempts to bring the metaverse to the mainstream.

Bitcoin^ slumped below $35,000 over the weekend. It’s down about 50% from its all-time high last November. But still up about 1,000% from its 2019 low … Perspective matters.

Here’s a year-to-date look at the markets:

  • Nasdaq Composite -22.4% YTD
  • Russell 2000 -18.1% YTD
  • S&P 500 -13.5% YTD
  • Dow Jones Industrial Average -9.5% YTD

Technicals:

The put-to-call ratio is still oversold. That’s day 12 now…

The VIX is high and failed to break through the resistance level at 35 in any meaningful way.

VIX Daily Candles – Chart via thinkorswim

The Dow Jones is the one and only major index still trading above a recent meaningful support level.

All and all things are still looking very bearish.

But with about 80% of stocks trading below their 50 and 200-day moving averages the potential for much more downside is limited.

Timing:

It’s a slow week for news…

New inflation data will steal the headlines on Wednesday and Thursday with the CPI and PPI reporting on those days respectively.

I remain risk off and am trading very small sizes at the moment.

Here are my top stocks…

Watchlist:

*Low Float
^Open Position

^*RCMT has resistance at $20
^CYN has resistance at $4
ICPT is on watch
CVI has support at $32
FNKO has support at $20
LPG is on watch
HDSN is on watch
^SGML has support at $15
DK has support at $26
^REI has resistance at $5
ARLP has support at $18.50
TTI has support at $4.40
CC is on watch
UNM has support at $34
^DVN has support at $65
EDU has support at $12

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