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Dow Jones futures were little changed on Wednesday evening, as were S&P 500 futures and Nasdaq futures. The stock rally had a mixed session on Wednesday with the Dow Jones hitting record highs as many growth names struggled. The price of Bitcoin has exceeded $ 52,000.
X
Federal Reserve officials did not expect to start scaling back their massive asset purchase program for “a while,” the recently released minutes from the January Fed meeting showed. In the meantime, You’re here (TSLA) rebounded from key support as Cathie Wood, of ARK Funds, said she bought more Tesla shares as “our confidence in Tesla increased”. But Apple (AAPL) sub-levels of the keys.
Meanwhile, the communications software manufacturer Twilio (TWLO), Canadian pot producer Tilray (TLRY), leader in edge networks Quickly (FSLY), Chinese research giant Baidu (BIDU), manufacturer of genomics tools 10X genomics (TXG), fertilizer specialist Mosaic (MOS), lithium miner Albemarle (ALB) and creator of chip design software Synopsys (SNPS) were the main profits overnight.
Twilio and Tilray shares were big winners overnight, while Mosaic and Baidu shares rose modestly. The ALB, Fastly and Synopsys shares fell slightly while the TXG share was not active.
In general, these stocks are not close to buying points because they are too wide or well below highs. Mosaic stock, which posted a short consolidation on Tuesday.
Apple and Tesla shares are listed on the IBD rankings.
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Dow Jones Futures today
Dow Jones futures fell 0.1% from fair value. The S&P 500 and Nasdaq 100 futures contracts were largely unchanged.
Bitcoin’s price topped $ 52,000 on Wednesday, a day after it first crossed $ 50,000. Bitcoin remains above $ 52,000 in late afternoon trading. Cathie Wood, who bought Bitcoin-related games, said the cryptocurrency could reach $ 200,000 if more companies join Tesla in buying Bitcoin.
Keep in mind that overnight action on Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular trading session.
Join the IBD experts as they analyze the exploitable stocks during the stock market rally on IBD Live.
Coronavirus news
Coronavirus cases around the world have reached 110.39 million. Covid-19 deaths have exceeded 2.43 million.
Coronavirus cases in the United States have reached 28.44 million, with deaths exceeding 502,000.
Fed reports no bond cuts for ‘a while’
Strong retail sales and other economic data early Wednesday appeared to undermine growth stocks around the open. A stronger economy is good news, all other things being equal. However, the solid reports ease the pressure to embrace a huge new stimulus, though a big package is always likely. In addition, the 10-year Treasury yield has risen in recent weeks, slightly higher on Wednesday.
However, the Federal Reserve is in no rush to take the punchbowl. While some Fed officials may be concerned about asset prices, Fed chief Jerome Powell and the central bank are focused on boosting economic growth and jobs. The Fed meeting minutes released on Wednesday afternoon made it clear that policymakers will continue to pour cheap money into financial markets and the economy.
Wednesday stock rally
The stock rally started off badly, at least for growth stocks, and worsened as the morning progressed. But Cathie Wood, CEO of ARK Funds, spoke about Tesla shares. At 2 p.m. ET, the minutes of the Fed meeting were released.
The Dow Jones Industrial Average rose 0.3% in stock trading on Wednesday as industries, financials and manufacturers of fertilizers and other stocks in the real economy performed well. The S&P 500 Index closed just below its fair value. The Nasdaq composite fell 0.6%, near session highs after falling 1.7% intraday.
Tesla Stock To buy?
Tesla stock fell as low as intraday 762.08, nearly touching its 50-day line and undercutting the 10-week average. But stocks rallied to close 0.2% at 798.15. Cathie Wood said she is still buying shares in the electric vehicle maker. Wood once again expressed his “confidence” in Tesla’s potential for motorcycling and autonomous driving. Wood has been a long-standing proponent of Tesla’s autonomous driving efforts, even as autonomous experts escalate criticism and more rivals test true autonomous vehicles.
This is the first test of the TSLA stock at 50 days / 10 weeks since its breakout in November, so it could be a buy signal. However, Tesla stock remains below its 21-day exponential moving average, an area of resistance in recent days.
Apple stock
Apple stock did not fare as well, falling 1.8% to 130.84, closing below its 50-day and 10-week lines. Shares fall more and more from a point of purchase of 138.89 cups with handle. The relative strength of Apple stocks continues to blur. Apple stock isn’t flashing a huge sell signal yet – it’s only 1.2% below its 10-week line – unless you drop 7% to 8% on your price. ‘purchase.
Growth stocks had a tough exit, with popular software names and speculative stocks taking hits, even as they cut losses.
Among the top ETFs, the Innovator IBD 50 ETF (FFTY) fell 1.7%, while the Innovator IBD Breakout Opportunities ETF (BOUT) fell 2%. The iShares Expanded Tech-Software Sector (IGV) ETF fell 1%. The VanEck Vectors Semiconductor ETF (SMH) fell 1.9%.
The ARK Innovation ETF (ARKK) lost 2.1% and ARK Genomic Revolution (ARKG) 1.8%.
Main gains
Twilio earnings beat views while revenue guidance was strong. Twilio stock jumped 10% overnight, signaling a record high. TWLO stock fell 2.3% on Wednesday to 411.65.
Tilray reported a lower than expected loss as sales narrowly edged. Tilray’s stock jumped 8% in extended trading. But that’s not a big step for this stock of marijuana. TLRY stock fell 9% to 31.51 on Wednesday, well below its high of 67 on February 10.
Profits quickly narrowly exceeded quarterly views, but his forecast ranged from the line to slightly below consensus. FSLY stock fell 3.5% in overnight trading. The stock quickly fell 2.7% to 94.85 on Wednesday, a fifth consecutive decline. Equities have seen a broad and loose consolidation which looks more suspect at the current stage of the stock market rally.
Baidu’s profits easily exceeded expectations, but sales fell short. Baidu’s stock rose 2.5% in extended trading. BIDU stock fell 5.4% on Wednesday, taking an 11-day winning streak to an all-time high.
10X Genomics reported a huge loss, but sales were up 49%, beating views. The 10X share was not yet active overnight. TXG stock fell 2.5% on Wednesday after falling from a record high on Tuesday.
Mosaic’s profits easily beat the consensus. The MOS stock rose 2% in extended action. The mosaic title plunged 0.7% on Wednesday after breaking through a short consolidation on Tuesday.
Synopsys results exceeded first quarter tax views. SNPS stock plunged 1% overnight. Synopsys slipped 2.4% on Wednesday after falling from a record high on Tuesday. According to MarketSmith’s analysis, SNPS stock is stretched from a fixed base buy point of 246.79.
Albemarle’s profits exceeded expectations. ALB stock fell 2.5% in extended trade. Albemarle stock fell 2.9% on Wednesday, undercut its 50-day line after reversing the decline on Tuesday below its 21-day line. Investors could buy a rebound in ALB shares from the 50-day line, but should likely wait for a move above the 21-day or even Tuesday intraday high of 171.35.
Why this IBD tool makes it easier to find the best stocks
Analysis of stock market rallies
Whether you want to call Wednesday’s session a pullback or a spin, the stock rally saw the move out of major stocks on Wednesday.
Is it just another day’s break or the start of a week’s pullback or something more serious? The Nasdaq is now 6.2% above its 50-day moving average. It’s off recent highs but still slightly extended. The Nasdaq didn’t even close below its 10-day line. A pullback towards the 21-day exponential moving average or even the 50-day line could still be seen as a relatively modest pullback, especially if the market rebounds. However, there is always the possibility that this setback will be deeper and more lasting.
The Nasdaq never touched its 21-day line on Wednesday, but many growth names were down more than 5% or more, adding to Tuesday’s losses.
The playing time on the market is over
Powerful stock rallies are great, but they can breed bad habits. Over the past 10 months, if you’ve invested heavily, bought the hottest names, added pullbacks, and don’t worry about messy consolidations, then your portfolio has seen huge gains.
Investors who bought the bottom of Nasdaq or Tesla stock were rewarded again on Wednesday, at least for a few hours. Perhaps growth stocks will return to record levels.
But if you trade like it’s a wild and unstoppable long-term stock rally, your portfolio is going to explode.
It’s time to linger and adopt proper sales rules and focus on the top actions that build a good foundation.
Remember, these top stocks and quality basics may not be in traditional growth names. At least investors should broaden their horizons to cyclicals and financials.
Read The Big Picture every day to stay in sync with market direction and major stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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