Inflation fear and Bullish Price Action

Here are the market observations for today

1. What matters is what the market does and not what you think it should do.
2. State of S&P 500: Double top or set up for a new high. Here’s how it looks
3. Everybody is scratching their head why the market is near highs when the inflation scare is for real. Bullish argument: Look at the earnings.
4. Earnings Picture: About 84% of companies have beaten earnings estimates for the third quarter. Companies have managed to deliver strong results due to the combination of price increases and cost cuts
5. American Express just reported its earnings on Friday, Oct. 22, blowing away analyst estimates. Revenue surged 25%, with earnings per share up a whopping 75% over the past year. The quarter’s $2.27 EPS figure beat analyst estimates by a huge $0.50. AXP is a buy at the current market price
6. Paypal is not interested in Pinterest and the stock PINS is down big time today
7. AMD makes a new all-time high at 122
8. The Crypto ecosystem has a new offering: Crypto-backed debit cards and credit cards. Cryptocurrency exchange Bakkt BKKT is partnering with Mastercard to offer crypto debit and credit cards while Coinbase is partnering with MQ. I will buy BKKT between 14 and 14.5 if I can get it.
9. CLF broke down below 100 dma with a gap down, blame China’s sell-off but then took support at 200 dma and now has bounced back thanks to strong earnings. The stock just did not move the way we anticipated. If you hold it, then the stock continues to be hold.
10. The stocks that consistently disappoint: 1. IBM; 2. Intel and 3. Nokia
11. Inflation is no longer a laughing matter. Brent Crude and US Oil now trade above $85.
12. Uranium trade is making a bullish move. I made a bullish case for UEC last week and today the stock is up 7%
13. Alternative Fuel stocks are on fire. Bloom Energy BE is up 35% today. Even Plug is up today. The only stock that’s not participating is FCEL. Bloom Energy is up big because it has entered in a partnership with South Korean-based SK Group’s affiliate SK ecoplant for a $4.5 billion revenue deal.
14. Speculative Bullish Breakout in a space stock RDW. The stock is a buy at 14.4. The stock is a play on space economy.
15. The market is made up of people. The more you understand people, the more you understand the market.

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