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8/25/22 The Most Expensive Tick in The Market

News:

Wednesday belonged to the bulls. 62% of stocks posted gains.

Generic chart pointing higher.

All four indexes closed green. And the Dow and S&P 500 snapped 3-day losing streaks…

Take note of the biggest gainer…

Sector Roundup

All 11 sectors ended the day green.

  • Energy (XLE) led with a gain of 1.2% as the price of crude climbed
  • Real Estate (XLRE) came in second, adding 0.8%
  • The remaining 9 sectors settled with modest gains between 0.6% and 0.1%

Notable Names

Women riding a Peloton Bike
Image from Peloton

Peloton (PTON) rocketed 20% higher after announcing plans to sell products on Amazon (AMZN).

  • The stock is still down 88% over the past year.
  • The company is expected to report another loss on its earnings call this morning.

Meme stock Bed Bath & Beyond (BBBY) rallied 18% on positive news.

  • The troubled retail is nearing a deal to borrow $400 million, according to a Wall Street Journal report.
  • The company had been facing liquidity issues, according to the report.

Technicals:

When we talk about support we often think of straight lines. But the reality is both support and resistance are more zones than lines.

Check out this chart that tracks the S&P 500…

SPY chart with support zone marked
SPY Daily Candles – Chart via thinkorswim

While we wanted to see the market hold above the top line … The current sideways movement is showing us a strong area of demand.

We are waiting for confirmation that the bullish trend will continue.

If the SPY closes above $420, we’ll flip back bullish.

Our current stance is neutral.

On that note, we are not interested in timing these turns perfectly. The first and last tick of a trend are always the most expensive ticks of the trend.

The other signals we’re tracking…

The market is free to move higher if it wants.

Timing:

Today…

  • Tesla’s (TSLA) 3-to-1 stock split is set to take effect. Shares are higher in premarket trading.
  • The final Q2 GDP number is set to be released at 8:30 this morning.

This week’s main event is scheduled for Friday…

Watchlist:

*Low Float
^Open Position

*NERV resistance at $8
*SSY support at $1.60
*RVAC is on watch
AXSM is on watch
COGT support at $16
VERV support at $38
RYTM support at $23
CSIQ support at $42, resistance at $45
FLNC support at $19
INFI support at $1.60
PRVA support at $40
^GEO support at $7.50
SEEL resistance at $1.25
ENVX resistance at $25
CANO resistance at $7
TCRT support ta $2
^GERN resistance at $2.50
GSAT support at $1.80

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