Bulls are draining bears

Here are the market observations for today.

1. When there’s nowhere to run, nowhere to hide, what do you do? ~ Jason Zweig, WSJ. 
2. Bears have all the arguments but Bulls have one simple argument: Where will the money go. Is the TINA factor driving stocks higher?
3. Nowhere to hide: Traders continue to sell bonds and as a result, yields continue to climb. The US 10 year yields are now at 1.56% on fears of supply chain constraints and persistent inflation.
4. Excellent Bank earnings + rising yields have resulted in a breakout in Large Cap Financials XLF. Here’s how
5. Ford has quietly rallied 22% over the last month. Good sales numbers and aggressive EV announcements seem to be helping the case. Here’s how
6. Uber made a large candle move on Sep 21 to 44 on return to profitability argument. The stock has quietly climbed higher since then and now trades at 48.
7. In a bull market, the market is forgiving of bad news but in a bearish environment, the reaction is over the top. Hence one is better off avoiding concept news-driven stocks.
8. Virgin Galactic SPCE plunged today after the company announced that it will delay its commercial spaceflights until the fourth quarter of 2022.
9. Morgan Stanley has disclosed that it has a 10% stake in WTRH Waitr Holdings small food delivery company and traders are excited. I will avoid such names in the current market environment.
10. It has been an interesting week. First, it was Clean Energy, Alternative Fuels, Solar Energy that got the momentum, and now it’s all Bitcoin thanks to the newsflow that the Securities and Exchange Commission is set to allow the first U.S. bitcoin futures exchange-traded funds to start trading.
11. No wonder Bitcoin is at $60000. It’s driving the entire Bitcoin ecosystem stocks from Coinbase, Silvergate Capital to Bitcoin mining stocks be it Marathon Patent MARA and RIOT. I hope you all have Silvergate Capital SI.
12. Most of the Bitcoin stocks look very extended and it’s hard to chase them. This breakout looks compelling – HUT. It’s a digital asset mining company. I will buy and pray.
13. When a stock gaps up on a strong earnings report, it runs away. Palo Alto Networks PANW is now up 16%
14. Every Gap up is not a happy ending story. Sometimes stock gap up and then sell-off. Merck covid pill announcement created a one-day excitement we see what happened thereafter. See the Merck Chart
15. Becoming a consistently profitable trader just might be the hardest thing you will ever do in your life. Remember that’s the goal.

Trade Sheet:

Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purposes. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers