February 12, 2024

If you choose to no longer receive our free newsletter and daily market updates, click here to UNSUBSCRIBE 

Hey Trendsters,

That Mahomes magic in the Super Bowl? Talk about a comeback! Just like the Chiefs, sometimes the best investment wins come after a slow start and require overtime effort. Today, we're channeling that winning energy and breaking down why patience might be your secret weapon this year.

Speaking of underdogs, Bank of America is making some bold calls - active traders could have an edge as more money sits passively in index funds. Think of it as less competition out on the playing field. We'll cover which sectors look good for stock picking and why holding strong is a superpower with our "Market Touchdowns" analysis.

Of course, I've got chart action lined up with Target ($TGT) showing some breakout moves. Plus, expect Market Moving News and maybe a pop quiz about the stock market to test your trivia skills.

Get ready, Trendsters – let's make this week a touchdown!

Today's Market Mood: EXTREMELY BULLISH!

The Bear-Bull Meter

Sponsored

Experts are predicting that in as little as three months, AI as we know it could be totally blown away. And that means ChatGPT could be replaced by a new AI model that's thousands of times more powerful... something that could cause expensive tech stocks like Microsoft, Google and Nvidia to double - maybe even triple - in price in the months ahead.

Click here for all the details.

Trendsters, the S&P 500 cracking 5,000 is like Wall Street hitting a high note – impressive, but the song isn't over yet. This week revealed resilience against rising rates, but also hints of where the smart money might flow next.

The Big Picture

• Shoppers Aren't Broke (Yet): Consumer spending is the economy's engine, and while there's less gas in the tank, it's not sputtering out. This bodes well for sectors punished by high rates.
• Fed Fears Fade: We all hate rate hikes, but the market's getting used to them. This 'soft landing' possibility keeps our overall 2024 outlook cautiously optimistic.
• The Tech Tide Turns? Big name darlings can't carry the market forever. We still see value stocks and mid-caps getting their groove back as conditions normalize.
• Don't Ditch the World: Yes, US equities are shining, but global diversification remains a smart hedge against surprises.

Strategies to Watch

• Cyclical Bets: Think sectors tied to economic health, they've been beaten down but may have room to run.
• The Underdogs: Smaller companies and overlooked sectors could catch up if sentiment stays bright. Your research could uncover hidden gems.
• Inflation Checkup: Next week's reports are critical – a hot reading could spoil the mood fast. Be ready to adjust your holdings if needed.

The 5,000 record is great, but it's staying ahead of the market that brings home the real trophies.  As always, I'm here to help you cut through the noise!

Sponsored

So, the Chiefs pulled off a dramatic win, and according to the infamous Super Bowl Indicator, Wall Street's headed for a loss this year. Remember, this "theory" has some wins under its belt – 75% accuracy sounds tempting, right?

But let's get real... that's like trusting your fantasy football lineup to actually deliver points. We know the Super Bowl and the stock market have as much in common as a halftime show and tax forms.  Think about it:

2008: Giants win, Wall Street melts down. Ouch, busted indicator.

2019: Patriots take it, and stocks go sky-high. The signal's more confused than a bad ref call!

The market's more than a coin toss: We've got interest rates, earnings reports, the whole global economy weighing in... way more complex than who runs for the most touchdowns. This silly superstition might be fun over beers, but NOT when making serious investment calls.

$TGT Breaks Trend, But Can Target it Keep Going?

Target's finally ditching that downward slump! Those chart patterns – the wedge breakout, the possible head and shoulders – tell a story of shifting sentiment. After a rough consolidation, $TGT's got a shot at reclaiming some lost ground.

The Playbook:

Entry Points: Missed the dip? Eye $142 for a decent start, though $133 would be the gold standard re-entry.

Target-ing Growth: Aim for $153, $166, even $180 if market bulls stay strong. Higher highs aren't guaranteed, though – that $205 mark is ambitious.

Manage Risk: That $133 support? It's your failsafe if this rebound falters.

A Few Questions Linger:

Did Target truly get the 'woke' memo? Consumer trends impact how high this stock can truly climb.

Can shoppers sustain spending? We need healthy consumer data to keep pushing TGT forward.

This turnaround isn't certain, but charts don't lie – Target's finally getting off the clearance rack. Keep a close eye on both price action and broader market sentiment to see if the breakout sticks!

Sponsored

Get ready for a market shake-up! Bank of America just handed active investors the keys to outperform in 2024. Turns out, as index funds rise and analysts dwindle, overlooked investment gems are ripe for the picking.  Think of it as an antidote to mindless 'buy the dip' crowds.

The Breakdown:

• Less Noise, More Gains: Fewer analysts mean less efficient pricing, creating an edge for those willing to do the research.
• Fundamentals Matter Again: Companies driven by earnings and future prospects, not hype, shine brightest when the herd moves blindly. BofA suggests tech, consumer, and healthcare stocks as starting points.
• Think "Off-Broadway": The most covered stocks get all the love. Undervalued, lesser-known names offer huge risks... but that means huge potential wins too.

The Winning Strategy:

Ditch the Index Hype: Focus on a company's OWN merits, not how it fits the day's hot macro trend.

Seek the Hidden Gems: Wall Street has favorites – go explore the unloved companies where big price moves lurk.

Patience IS Profit: Forget TikTok-speed trading.  BofA's data backs it up: long-term holds drastically slash risk, and increase rewards.

This isn't your grandpa's Wall Street anymore. Passive fund mania created an opening for informed, savvy investors.  Buck the trend, exploit the inefficiency, and beat those boring ETFs at their own game.

Last week gave us a taste of things to come: Earnings reports and analyst moves sparked wild stock swings, highlighting the market's split focus. Let's unpack the key stories:

Spotlight Movers:

Hot Growth, Mixed Results: Bitcoin-tied CleanSpark (CLSK) got a boost, while travel stock Expedia (EXPE) took a hit despite good numbers. Hype fuels some wins more than reality.

Big Names Stumble: PepsiCo (PEP) and Pinterest (PINS) disappointed, proving not even major players are immune to raised expectations.

AI Frenzy: Investors keep chasing gains in tech... but, as Schwab notes, is this bubble territory?

The Week Ahead:

Busy Earnings Slate: Coca-Cola (KO), Airbnb (ABNB), etc., step up. Can they continue the hot streak and justify inflated valuations?

Inflation Watch: CPI and PPI are critical data points for the Fed. Surprises either way could shake up expectations for rate cuts, rocking the market.

Key Takeaways:

Earnings Still Sway Stocks: Strong companies get rewarded, weak ones punished. This emphasizes active stock-picking in a year of mixed signals.

Hype Isn't Sustainable: Tech trends are HOT, but at some point, fundamentals (or lack thereof) catch up.

Fed Still Holds Influence: Even good economic news could make them hold rates higher, longer – that's bad for growth stocks.

As always, staying ahead of the curve means tracking not just the headlines, but the nuances.

Random Musings:

Did the AI-hype for tech stocks reach Super Bowl halftime show levels yet? All flash and potential, but will it deliver consistent gains?

If picking under-the-radar stocks is the key to outperformance, does that mean your research tools are the new high-tech metal detector? Time for some beachcombing the financial statements…

Focusing on fundamentals is wise, but what if an unforeseen news event disrupts everything? It reminds us that investing involves both analysis and a bit of battlefield adaptability.

"Patience pays off" sounds great, but when those long-term holdings have a bad month, do you really hold or is there a point of re-assessing?

Are tech giants so big they become "too systemic to fail"? That's a question not about returns, but about potential market-wide risks.

On this day in history, February 12

1825: The House of Representatives elects John Quincy Adams as President. A contentious outcome...sounds eerily familiar to recent political battles.

1913: The 16th Amendment, authorizing a federal income tax, is ratified. Proof that even with long-term planning, some market surprises are inevitable!

1935: Iceland becomes the first country to legalize abortion. A groundbreaking move towards recognizing individual choice – something investors also do daily when navigating markets.

1968: Gold prices jump following increased global instability. A reminder that some investments serve as havens when markets are jittery.

1995: Astronaut Eileen Collins becomes the first woman to pilot a space shuttle. Breaking barriers often leads to outperformance, in space and markets!

Just like Mahomes pulled off a second-half comeback, this year could see active investors stage their own rally.  BofA's calling it: less attention on hyped-up plays means it's time to scout undervalued stars. Think hidden potential, those unsung 'benchwarmers' ready to break out, not just the ones hogging the headlines.

We discussed AI fervor, earnings surprises... remember, fundamentals score those long-term wins, not quick hype passes. Don't just go with the crowd - focus on building a 'winning team' portfolio,  like an analyst crafts a playbook. Patience and research are your secret weapons!

The words of investment legend George Soros ring true: "If investing is entertaining, if you're having fun, you're probably not making any money. Good investing is boring." Take time, do your homework, and bet on winners with staying power, not halftime show flashiness.

Disclaimer:

Trading foreign exchange, stocks, options, or futures on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade, you should carefully consider your objectives, financial situation, needs and level of experience.

This newsletter provides general information that does not take into account your objectives, financial situation or needs. The content of this newsletter or our website must not be construed as personal advice. COE Media is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation.

The possibility exists that you could sustain a loss in excess of your deposited funds and therefore, you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with trading on margin. You should seek advice from an independent financial advisor.

Any past performance presented is not necessarily indicative of future success.

Always do your own research and consult with a licensed investment professional before making an investment. This communication should not be used as a basis for making any investment.

Advertising Disclosure: This email contains paid advertisements and we have been paid in some fashion to send this advertisment to our readers.

If you do not wish to receive this email, then we apologize for the inconvenience. You can immediately discontinue receiving this email by clicking on the unsubscribe link and you will no longer receive this email.  If you have any questions, please send an email with your questions to [email protected]

We strongly urge you to read our full disclaimer here.

UNSUBSCRIBE 

TradersOnTrend.com

COE MEDIA.    1126 S Federal Hwy
Unit #827    Fort Lauderdale, FL 33316