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Last week, we talked about the plethora of setups in the software space and the weakness in the so-called old-economy sectors – financials and basic materials which caused the S&P 500 to close below its 50-day moving average. A few days later, SPY closed at new all-time highs led by banks, retailers, oil, biotech, and tech stocks. In other words, almost everything went up. Maybe it was the rise in interest rates or the new infrastructure stimulus plan announced by the government but the fear of missing out is back with full force. We can see it clearly in the run in many of the speculative highly-shorted stocks that had 50-80% drawdowns this year alone – SPCE, DDD, FUBO, WISH, PUBM, TTD, ROKU, etc.
In the meantime, the impressive growth in Nike’s latest earnings report confirmed that there’s a huge pent-up demand in the U.S. which is likely to benefit consumer discretionary stocks. Some names to consider include FTCH, SFIX, DECK, etc.
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