Category: Momentum Mondays

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U.S. stocks continue to climb a wall of worry. SPY is already up 20% from the Christmas lows and is quickly approaching $280, which has been a major area of technical resistance in the past year.

While tech stocks are taking a little break after a strong run in the first few weeks of the year, we are starting to see quite a few other sectors breaking out and setting up – biotech, healthcare, transportation, energy, financials. Things are almost too good to be true.

Check out my latest book: Swing Trading with Options – How to trade big trends for big profits.

All charts on Momentum Monday are powered by MarketSmith

Unsurprisingly, the first test of SPY’s and QQQ’s 200-day moving averages has led to a slight pullback, but under the surface, we continue to see predominantly positive market action. The market is reacting favourably to earnings reports. Dip buyers are still eager to scoop pullbacks in strong momentum stocks.

In today’s Momentum Monday, we went over some setups in enterprise software, cybersecurity, communication devices, medical instruments, biotech, aerospace.

Check out my latest book: Swing Trading with Options – How to trade big trends for big profits.

All charts on Momentum Monday are powered by MarketSmith

Correlations are decreasing, volatility is declining, the market reaction to earnings has been predominantly positive, corrections are happening via sector rotation. In other words, the U.S. stock market is back to a normalized trading environment, where stock picking matters.

Enterprise software and cannabis-related stocks continue to lead the market higher. We discuss a potential rotation into other sectors ahead. Biotech and medical devices are couple industries that are setting up.

Check out my latest book: Swing Trading with Options – How to trade big trends for big profits.