On Wednesday, the Web3 fitness and move-to-earn platform Stepn unveiled a $30 million airdrop campaign, offering participants the chance to earn FSL points that can be exchanged for GMT tokens. Stepn Reveals $30M Airdrop, Precedes Big Brand Collaboration The Solana-based Stepn has begun the allocation of 100 million FSL points among its users, which they […]
Source link
On March 29, 2024, with a trading price of $70,075, and oscillating within a 24-hour range of $68,362 to $71,754, bitcoin’s current market behavior reveals significant consolidation and neutrality. Bitcoin Bitcoin’s 1-hour chart reveals recent volatility, with a significant bounce from a low of approximately $68,362, suggesting a strong support level. Conversely, the resistance near […]
Source link
Anticipations for the upcoming Bitcoin halving event are high in the cryptocurrency community, with hopes of BTC witnessing a massive rally post-event. Nonetheless, several key factors should be considered prior to the halving.
Ali Martinez, a famous cryptocurrency analyst has revealed the major key points investors need to watch out for ahead of Bitcoin halving. The analyst shared his opinions on the subject through the social media platform X (formerly Twitter).
In the X post, Martinez pointed out just four important factors to consider as the event drew near. The upcoming halving, expected to take place by April this year, will be the fourth time it has been done.
One of the first and key areas highlighted by Martinez to spot is the post-Bitcoin halving corrections. Martinez stated that within a month following the 2020 and 2026 halvings, BTC saw substantial corrections, which preceded this price surge.
He explained that within a month after the 2016 event, the price of Bitcoin fell by 30%. He also said a similar scenario played out in the 2020 halving, which saw price plummet about 7%.
The Bitcoin halving has always been viewed as a bullish development that leads to a significant rise in the price of BTC. This is primarily due to the fact that as demand increases, the quantity of fresh BTC coming into the market declines.
For the second key point to look out for, Martinez has underscored massive post-halving rallies. According to him, there is typically a sharp increase in the price of Bitcoin after the post-halving drop.
In particular, the expert asserted that after the halvings in 2012, 2016, and 2020, the price of Bitcoin surged by 11,000%, 2,850%, and 700%, respectively. Due to this, many experts anticipate that BTC’s price will reach a new all-time high after the event is concluded.
Martinez’s third crucial aspect to consider is the bull market durations. As is widely known, every previous halving event often ushers in a bull market.
He then shared a calculative time of how long the market rallied during all the previous halving. Martinez stated that the 2012, 2016, and 2020 bull market lasted for 365 days, 518 days, and 549 days, respectively.
Meanwhile, the last part pointed out by the expert is the next market top. He believes that Bitcoin will get to a new peak by April or October 2025. Martinez anticipates this to take place if only the upcoming event follows historical patterns. So, he has urged the crypto community to be vigilant and observe these patterns.
As of now, BTC is trading a little above $42,000, showing a decrease of almost 2% in the past 24 hours. Its trading volume has increased by 14% today, while its market cap is down by 1.90%.
Featured image from iStock, chart from Tradingview.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Recently, Bitcoin experienced a significant drop, crashing 15% from its 2024 highs around $49,000. This decline followed closely on the heels of the approval of 11 spot Bitcoin Exchange-Traded Funds (ETFs), a move that was initially met with optimism in the crypto community. The sudden downturn has left investors and traders analyzing the charts for clues about Bitcoin’s next move.
In the wake of this decline, technical analysis offers a beacon of insight. Notably, the correction was marked by a bearish engulfing candle on the daily chart, signaling a potential reversal in Bitcoin’s upward trend.
Accompanying this was a nasty wick – a long upper shadow on the candlestick chart, indicating a significant sell-off after prices peaked.
Further complicating the landscape was the opening of the CME BTC Futures with a sizeable gap down. Such gaps are often viewed as potential resistance levels, reinforcing the bearish sentiment.
The Parabolic SAR remains below price action | BTCUSD on TradingView.com
However, amidst these seemingly negative signals, a ray of hope shines through from a “parabolic” technical indicator – the Parabolic SAR (Stop and Reverse).
Despite the tumultuous market conditions, the weekly BTCUSD Parabolic SAR indicator remains untagged, suggesting that the long-term uptrend is still intact.
This indicator, known for its effectiveness in identifying potential reversals in the market’s direction, paints a different picture from the immediate bearish signals and sentiment.
To fully grasp the significance of the Parabolic SAR in this context, it’s essential to understand what it is and how it functions. The Parabolic SAR is a popular technical analysis tool used primarily to determine the direction of an asset’s momentum and to provide entry and exit points.
The ‘SAR’ in Parabolic SAR stands for ‘Stop and Reverse.’ This indicator is represented on charts as a series of dots placed either above or below the price bars. A dot placed below the price is viewed as a bullish signal, while a dot above is bearish.
The unique aspect of the Parabolic SAR is its ability to act as a trailing stop loss. As the price of an asset moves, the Parabolic SAR adjusts, moving closer to the price line. This adjustment provides a dynamic method for traders to manage their positions, securing profits while limiting potential losses.
In the context of Bitcoin’s current situation, the Parabolic SAR’s position – still below the price bars on the weekly chart – suggests that the long-term bullish trend is not yet disrupted.
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
The decentralized Oracle network Chainlink and its native token LINK have grown impressively in the past month. Despite experiencing a correction since late December, where LINK reached a 20-month high of $17.6, the token has shown signs of renewed bullish momentum.
Renowned crypto analyst Ali Martinez has identified a robust demand zone for Chainlink between $14.8 and $15.2, slightly below its current trading price of $15.415.
Within this range, many addresses (17,650) purchased 85.12 million LINK. With limited resistance, LINK appears to be well-positioned to advance towards the $20 mark.
Based on the analyst’s observations, if the current bullish momentum witnessed over the past seven days persists, LINK could swiftly reach the $20 price level. Looking at LINK’s 1-day chart, the next resistance levels to overcome before potentially climbing toward $20 are $15.55, $16.69, and $16.92. Breaching these levels would pave the way for a clear path towards the $20 milestone.
However, it is important to note that in the absence of major resistance walls, the battle for the next direction of LINK’s movements remains equally balanced. In the event of another price correction or selling pressure, the token lacks significant support walls to rely on.
Analyzing LINK’s 1-day chart, the first support level in the event of a drop would be around $14.22. If this level is breached, the next support stands at $13.31. A further decline could test the support at the $11 price level. A breach of this level could signify a breakdown in the four-month bullish structure of LINK.
Despite the battle for supremacy between LINK’s bulls and bears, the protocol’s ecosystem has shown notable growth in key metrics since the last update. For example, Chainlink’s circulating market capitalization is $8.35 billion, reflecting a positive growth rate of 3.58%.
According to Token Terminal data, in terms of revenue over the past 30 days, Chainlink has generated $11.67 thousand. However, this figure shows a decline of 54.16% compared to the previous period, indicating a decrease in earnings during this timeframe.
Considering the fully diluted market capitalization, which considers the maximum number of Chainlink tokens that could exist in the future, the value stands at $14.82 billion. This metric has experienced a slight increase of 3.48% recently.
When it comes to revenue on an annual basis, Chainlink has generated $219.81 thousand. This represents a positive growth rate of 2.64%, indicating an upward trend in the company’s earnings over a year.
Regarding financial ratios, Chainlink’s price-to-fully-diluted ratio is calculated at an astonishing 68,246.47x. This metric compares the company’s market capitalization to its fully diluted market capitalization. It reflects the premium investors will pay for each unit of potential future tokens.
Similarly, based on the fully diluted market capitalization, the price-to-sales ratio is reported to be 68,246.47x. This ratio measures the company’s valuation relative to its annualized revenue and indicates how much investors will pay for each dollar of sales generated.
Featured image from Shutterstock, chart from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
In the past week, Bitcoin recorded an overall positive performance, gaining by 3.45%, according to data from CoinMarketCap. This price rise adds to BTC’s bullish form in the last 30 days, during which the maiden cryptocurrency has surged by 16.78%. However, despite this market uptick, there appears to be a growing trend of caution among Bitcoin traders, indicating fear of a potential price dump.
In an X Post on Saturday, popular crypto analyst Ali Martinez shared an interesting observation regarding the Bitcoin market with his 37,000 followers.
According to Martinez, there is a significant decrease in the estimated leverage ratio in the BTC market across all exchanges. This indicates that traders are reducing their leverage risk and are now treading carefully in the BTC market, even amidst the current price gain.
As #Bitcoin price climbs, we see a decrease in the Estimated Leverage Ratio – a sign that traders are reducing their leverage risk. This suggests a more cautious approach in the #crypto market despite the $BTC price uptick. pic.twitter.com/421FjfyV6b
— Ali (@ali_charts) December 22, 2023
For context, leverage is a trading function that allows users to borrow funds in order to increase the size of a position beyond what would be possible with one’s own capital alone. Leverage allows traders to amplify their profits potentially, albeit it also comes with increased risk.
Now, the Estimated Leverage Ratio is a metric that quantifies the extent to which traders in the market are using leverage. Thus, a decreased estimated leverage ratio implies that traders are reducing the amount of borrowed funds relative to their own capital in their positions. In other words, they are decreasing the level of leverage they are using, which can be seen as a sign of caution among traders against a potential market dump.
The BTC market, which is currently on an uptrend, has witnessed similar puzzling events recently. On Friday, NewsBTC reported that Bitcoin whales sold 50,000 BTC worth $2.2 billion in the last week. All these movements are indicative of investors preparing for a possible bearish trend.
At the time of writing, Bitcoin trades around $43,626, with a 0.09% decline in the last day. Meanwhile, the token’s daily trading volume is significantly down by 29.63% and is currently valued at $17.22 billion.
For now, there is no clear indicative danger to BTC’s bullish form. Albeit, there is a high level of anticipation in regard to a potential approval order of the spot Bitcoin ETF in January.
While many analysts predict a spot Bitcoin ETF will lead to increased demand for Bitcoin, others are fearful of turning the maiden cryptocurrency into a state-controlled financial asset. However, Bitget chief analyst Ryan Lee anticipates Bitcoin to trade between $32,000 – $50,000 depending on the effects of this investment fund.
BTC trading at $43,576 on the daily chart | Source: BTCUSD chart on Tradingview.com
Featured image from Reuters, chart from Tradingview
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
The on-chain analytics firm Santiment has revealed a Cardano pattern that may have contributed as a trigger for the recent 65% rally in ADA’s price.
As explained by Santiment in a post on X, ADA witnessed a large number of small wallets clear themselves out last month. The relevant indicator here is the “Supply Distribution,” which keeps track of the total amount of Cardano wallets that belong to the different groups in the market.
The wallets or investors are categorized into these groups based on the number of tokens that they are carrying in their balance. For example, the 1 to 10 coins cohort includes all holders owning at least 1 and at most 10 ADA.
If the Supply Distribution is applied to this group, it would (among other things) total up the number of wallets satisfying this condition right now. In the context of the current discussion, Santiment has discussed about the Supply Distribution of two groups: 10 to 100 coins and 0 to infinity. The second one here is naturally a combination of all the wallet groups in existence, as there is no upper bound.
Now, here is a chart that shows the trend in the indicator for these two Cardano groups over the last few months:
Looks like both the metrics have observed a large plunge | Source: Santiment on X
As displayed in the above graph, both of these Cardano groups observed a plunge in their wallet count back on November 17. In total, the addresses carrying some ADA balance dropped by almost 35,000 on this day.
Generally, this kind of mass exit can be a bearish sign for the cryptocurrency, as it indicates a selloff is taking place. However, the finer details about which groups exactly have taken part in such selling can affect the outlook of the asset.
Interestingly, as Santiment has noted, 98.1% of the wallets involved in the aforementioned selloff belonged to the small holders. This would suggest that the larger entities like the sharks and whales only saw a minimal amount of exit during this plunge.
“A drop of addresses this size or smaller often indicates capitulation, and a potential price turning point,” explains the analytics firm. It would appear that the retail investors may have fallen prey to fear and sold off their holdings, which the big money investors potentially scooped up.
Related Reading: Bitcoin Rushes To Exchanges, But This Sign Remains Positive For The Bulls
Since this mass exodus of the small hands, Cardano has rallied around 65%, perhaps suggesting that this pattern may have been one of the contributors behind the surge.
While Cardano kicked off the month with some sustained bullish momentum, the rally has cooled off in the last few days as ADA has observed a notable pullback.
Since the $0.648 local top, the asset’s price has come down almost 11% as it now floats around the $0.577 mark.
The value of the asset appears to have enjoyed some rapid growth recently | Source: ADAUSD on TradingView
Featured image from Shutterstock.com, charts from TradingView.com, Santiment.net
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Google parent Alphabet (GOOGL), a Magnificent Seven stock and artificial intelligence leader, and Eli Lilly (LLY), fueled by FDA approval of its GLP-1 weight-loss drug, encompass a few of the key themes that have powered the stock market this year. But this weekend’s watch list comprising five S&P 500 names near buy points has a twist: Google stock is among four of the five that took a spill after their latest earnings reports, only to reverse sharply higher.
X
The other three of this resilient bunch include cybersecurity stalwart Palo Alto Networks (PANW) and two plays on travel and the consumer, Mastercard (MA) and Marriott International (MAR).
The IBD Leaderboard portfolio of elite stocks includes LLY, which also is a current SwingTrader holding.
The post-earnings resurgence of GOOGL, PANW, MA and MAR probably says as much about the nature of the S&P 500 rally as it does about the individual stocks.
In some cases, investors may have initially overreacted to company trends, like Google’s Cloud deceleration. Yet after some tough receptions for recent earnings reports, Wall Street’s mood turned very forgiving as inflation, jobs and spending data softened. That has allowed the Federal Reserve to back away from rate-hike threats, even as the 10-year Treasury yield tumbled following a test of 5%. Now markets are looking ahead to a Fed rate cut in the first half of next year.
That has sparked the S&P 500’s four-week 10.7% rally. There hasn’t been a sharper four-week percentage move since last fall’s brisk S&P 500 rally off the bear-market bottom through Nov. 11.
If you’re looking for a bigger S&P 500 point move over four weeks, you have to go back to the Covid-shutdown rally through April 17, 2020.
If there’s a problem, it’s that Wall Street may have turned too forgiving because investors have stopped worrying. The market fear gauge has fallen to pre-Covid lows, a potential precursor to a pullback.
Be sure to read IBD’s daily afternoon The Big Picture column to stay in sync with the market’s underlying trend and what it means for your trading decisions.
GOOGL stock tumbled 9.5% on Oct. 25 and kept falling after Q3 revenue edged past estimates, growing 11% to $76.7 billion, but operating income fell a touch short amid higher expenses.
Alphabet’s Cloud unit saw 22% growth to $8.4 billion, down from 28% growth in the June quarter. But Mizuho sees that as transitory, with growing AI adoption set to offset clients’ cost-control efforts. The research firm kept a buy rating on GOOGL stock with a 155 price target.
Alphabet, which has a 37% share of global digital ad revenue, saw search and and YouTube ad revenue grew 11% to 12% in Q3, faster than the industry, Needham analyst Laura Martin noted. She lifted her price target to 160 from 140.
Still, the ongoing antitrust trial over Google’s search dominance could be an overhang, with a verdict expected in the first half of 2024.
GOOGL stock slipped 1.3% to 136.69 on Friday. Alphabet’s move above its 50-day line, around 133.50, earlier in the week offered an early entry point. The official buy point is 141.22 from a seven-week cup base, according to MarketSmith.
GOOGL stock’s relative strength line, the blue line in IBD charts that tracks a stock’s progress vs. the S&P 500, had been right near an all-time high before its earnings mishap. However, the snapback rally hasn’t made up the lost ground for its RS line.
Market Rally Looks Great; Why That Could Be A Problem
Eli Lilly was IBD Stock Of The Day on Nov. 20 as shares set up following the FDA approval of its new weight-loss drug, Zepbound. It is based on the same drug, tirzepatide, behind its Mounjaro diabetes treatment.
Zepbound is being offered at a 20% discount to Novo Nordisk‘s (NVO) competing drug, which could drive better insurance coverage and uptake, Leering Partners analyst David Risinger said in a research note.
LLY stock has a 625.87 flat-base buy point. A move past the Nov. 20 high of 604.86 would break a trend line from the recent Nov. 8 high, flashing an early entry.
NVO stock skipped into a buy zone on Friday, rising 2.1% to clear a 104 buy point.
Palo Alto Networks stock inched into buy range on Friday, rising 1.1% to 266.08 — just clear of a 265.90 buy point from a five-week flat base.
PANW stock briefly tripped below its 50-day moving average on Nov. 16, trading as low as 234.15 following its prior afternoon fiscal Q1 earnings report.
PANW’s 66% earnings growth to $1.38 a share easily topped estimates, and revenue modestly beat, growing 20% to $1.878 billion. The firm also raised EPS guidance above views. The problem, to the extent there was one, came because billings growth of 16% was $45 million below consensus and full-year billings guidance also lagged, noted William Blair analyst Jonathan Ho.
The issue isn’t demand or even sales, but customers’ preference for shorter-term deals amid higher interest rates and cash-management challenges, Ho wrote.
Yet Ho says that Palo Alto is moving closer to its “strategic goal of becoming a single platform vendor solution for the cybersecurity space.” Palo Alto, he says, is one of the few vendors that customers may trust to provide a single platform because of its ability to innovate. Further, the macro environment and budget pressures may play to PANW’s strengths.
Cybersecurity peers Zscaler (ZS) and CrowdStrike (CRWD), which have market leaders, report this coming week.
Mastercard took its earnings spill on Oct. 26, falling 5.6% to 364.59 as it gapped below its 200-day moving average. But the credit card and debit carb network operator has since gone on a tear. Friday’s 0.5% rise to 412.50 left MA stock near a 418.60 buy point from an 11-week flat base.
Mastercard posted 26.5% EPS growth to $3.39, comfortably above $3.21 estimates amid a lower tax rate. Revenue growth of 14% to $6.53 billion was in line.
MA stock fell as analysts noted slightly softer trends to start Q4. Mastercard indicated that the slowing trend was primarily related to a tougher year-over-year comparison due to earlier expansion and the timing of Social Security payments. In other words, the resilient consumer story is still intact.
Meanwhile, Visa (V) stock has fared even better, striding past a 250.06 buy point as it climbed 4.7% to 254.30 last week.
Marriott stock took a brief trip on the down escalator on Nov. 2 after its Q4 outlook “underwhelmed,” according to Barclays, which trimmed its price target to 208, keeping an equal weight rating.
Marriott offered a Q4 EPS range of $2.04 to $2.13, below the $2.19 consensus.
Yet MAR stock, after sliding more than 4% intraday to 180.75, finished off 1.6% on the session.
The easing of Fed fears and interest-rate pressures — and the strong performance of other travel-related names — have given MAR stock an updraft.
MAR rose 1.5% to 208.93 last week, closing just below a 210.98 buy point from a 15-week cup base. Marriott’s RS line is just below its August multiyear high.
Hilton Worldwide (HLT) has surged through a buy zone in November, along with online travel site Expedia (EXPE).
YOU MAY ALSO LIKE:
Join IBD Live Each Morning For Stock Tips Before The Open
IBD Digital: Unlock IBD’s Premium Stock Lists, Tools And Analysis Today
How To Make Money In Stocks In 3 Simple Steps
Is Google Stock A Buy Amid DoJ Antitrust Case, AI Battle?
The Fed Broke The Budget. Buckle Up For What Comes Next
Hello! For this week’s ETF Wrap, I spoke to Michael Arone, chief investment strategist for the U.S. SPDR business at State Street Global Advisors, for his view of markets and where ETF investors may look for opportunities at this stage of the Federal Reserve’s interest rate-hiking cycle.
Please send feedback and tips to christine.idzelis@marketwatch.com or isabel.wang@marketwatch.com. You can also follow me on X at @cidzelis and find me on LinkedIn. Isabel Wang is at @Isabelxwang.
Sign up here for our weekly ETF Wrap.
Bond-market volatility spilling into stocks in 2023 may also be creating investment opportunities that could pay off in the next year, according to Michael Arone, chief investment strategist for the U.S. SPDR business at State Street Global Advisors.
“When interest rates have this great of impact on the stock market, historically, going forward it’s been a positive sign for stocks,” he said in a phone interview.
Investors may see over the next 12 months a broadening in the participation of in any stock market rally, with a potential recession in that period likely to be short and shallow, according to Arone. He said “the stock market may not be impacted for very long” by such a downturn.
Small-cap and value stocks stand to see some of the biggest gains, said Arone. That’s based on past periods when interest rate volatility rocked markets and similarly led to high dispersion in equities, he said.
The U.S. stock market is being driven by a small group of Big Tech stocks this year, while small-cap companies have lagged and large-cap growth equities have broadly crushed value.
The SPDR Portfolio S&P 600 Small Cap ETF
SPSM
is down more than 4% this year based on Thursday afternoon trading, while the SPDR S&P 500 ETF Trust
SPY
has jumped more than 13%, FactSet data show.
As for value versus growth, the almost 19% surge for the SPDR Portfolio S&P 500 Growth ETF
SPYG
in 2023 has far surpassed the 7.6% gain of the SPDR Portfolio S&P 500 Value ETF
SPYV
based on Thursday afternoon.
Some Big Tech stocks, which include Apple Inc.
AAPL,
Microsoft Corp.
MSFT,
Google parent Alphabet Inc.
GOOGL,
Amazon.com Inc.
AMZN,
Nvidia Corp.
NVDA,
Facebook parent Meta Platforms Inc.
META,
and Tesla Inc.
TSLA,
appear in the top holdings of both the value and growth ETFs.
The largest three weights for the SPDR Portfolio S&P 500 Value ETF were Microsoft, Meta and Amazon as of Nov. 8, according to a list of the fund’s top holdings on State Street’s website. The ETF’s next largest holdings were Berkshire Hathaway Inc.
BRK.B,
JPMorgan Chase & Co.
JPM,
Walmart Inc.
WMT,
and Cisco Systems Inc.
CSCO,
The SPDR Portfolio S&P 500 Growth ETF’s top 10 holdings on Nov. 8 included all the Big Tech stocks except Meta, data on State Street’s website show.
Rising yields in the U.S. Treasury market in recent months hurt stocks, with the S&P 500’s three straight months of declines through October paring its 2023 gains. So far in November, though, Treasury yields have retreated and the S&P 500 has climbed.
Bond market yield moves have had an “exaggerated” impact on the U.S. stock market, said Arone.
The S&P 500 closed Wednesday with an eighth straight day of gains that marked its longest winning streak since November 2021, according to Dow Jones Market Data. The index
SPX
finished lower Thursday though to snap that stretch of gains as Treasury bond yields rose.
The bond market is volatile this year as the Federal Reserve keeps its benchmark interest rate elevated, after slowing its aggressive pace of hikes aimed at bringing down inflation to its 2% target.
The market is anticipating that the combination of the Fed potentially concluding its hiking cycle, falling inflation and a slowing economy will put downward pressure on rates, said Arone.
Rising yields this year have led to steep losses in long-term Treasurys, with investors questioning whether now may be a good time to buy them.
The Vanguard Long-Term Treasury ETF
VGLT
was down 12.5% on a total return basis through October, but as yields declined this month the fund trimmed its year-to-date losses to 8.5% as of Thursday afternoon, according to FactSet data. Bond prices and yields move in opposite directions.
Investors have been trying to discern how long the Fed might keep rates elevated and then eventually begin cutting rates, on the expectation that such a shift in monetary policy would spur a price rally in long-term bonds.
Fed-funds futures points to traders anticipating the Fed may start lowering its benchmark rate in 2024, the CME FedWatch Tool shows.
Arone said one risk to his view that small-cap and value equities could drive a broadening in the stock-market rally is a deeper recession than he is now anticipating. A rise in real interest rates is another risk, he said.
See: Fed maintains freeze on interest rates as it fine-tunes fight against inflation
Short-term Treasury maturities remain the most attractive part of the yield curve with low volatility, but investors may also consider moving into intermediate-term investment-grade corporate credit in order to capture any rally from potential Fed rate cuts, according to Arone.
He said that strategy could involve holding the SPDR Bloomberg 1-3 Month T-Bill ETF
BIL
as well as the SPDR Portfolio Intermediate Term Corporate Bond ETF
SPIB.
Ultra-short-term T-bills are still “a good idea,” but taking on “a little bit” of credit risk may set investors up to benefit from price appreciation should the Fed finish tightening its policy and rates fall, according to Arone.
The SPDR Bloomberg 1-3 Month T-Bill ETF returned a total 4.2% this year as of Thursday afternoon, compared with a 1.8% total return for the SPDR Portfolio Intermediate Term Corporate Bond ETF over the same period, FactSet data show.
Read: Short-term bonds dominate fixed-income ETF flows again in October — with a single fund getting outsize portion of investors’ money
As usual, here’s your look at the top- and bottom-performing ETFs over the past week through Wednesday, according to FactSet data.
| Top Performers | %Performance |
|
Invesco China Technology ETF CQQQ |
6.4 |
|
ARK Innovation ETF ARKK |
5.4 |
|
ARK Next Generation Internet ETF ARKW |
5.1 |
|
VanEck Vietnam ETF VNM |
5.1 |
|
ARK Fintech Innovation ETF ARKF |
5.1 |
| Source: FactSet data through Wednesday, Nov. 8. Start date Nov. 2. Excludes ETNs and leveraged products. Includes NYSE, Nasdaq and Cboe traded ETFs of $500 million or greater |
| Bottom Performers | %Performance |
|
United States Natural Gas Fund LP UNG |
-10.3 |
|
First Trust Natural Gas ETF FCG |
-8.3 |
|
SPDR S&P Oil & Gas Exploration & Production ETF XOP |
-8.1 |
|
United States Oil Fund LP USO |
-7.9 |
|
iShares U.S. Oil & Gas Exploration & Production ETF IEO |
-7.0 |
| Source: FactSet |
The Magnificent Seven stocks — Alphabet (GOOGL), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA) — continue to drive the new market rally. And AMZN, META, MSFT and NVDA keep on making their presence felt on IBD Leaderboard as they fuel new setups in the nascent uptrend.
X
Fantasy sports and betting powerhouse DraftKings (DKNG) also makes this exclusive list of top stocks to watch. DKNG stock popped onto IBD Leaderboard as it cleared a trendline at the 30-31 level following its quarterly earnings report. Buliding on a more-than 16% gain Friday, DraftKings added another 4% Monday, again in heavy trade.
As Amazon, Nvidia and the other Magnificent Seven stocks build steam, ServiceNow (NOW) makes the Leaderboard list as it tests a breakout past a 607.90 buy point, closing Monday’s session just above that entry. Fellow enterprise software play Salesforce (CRM) earns a spot on the IBD Leaderboard watchlist.
A crucial driver of a stock’s performance is institutional demand — heavy buying by mutual funds and other large investors. The presence of the Magnificent Seven stocks and other names on IBD Leaderboard highlight that key factor.
Last month’s list of new buys by the best mutual funds showcased current Leaderboard members Meta and Nvidia stocks, as well as Ollie’s Bargain Outlet (OLLI), Zscaler (ZS) and Eli Lilly (LLY).
In the November report, which comes out on Friday, Amazon made a triumphant return following a long absence. Top money managers scooped up more than $16 billion worth of shares in Amazon stock.
Magnificent Seven Stocks: Latest News & Market Cap Weighting
With a new market uptrend underway and earnings in the bag for most these companies, several IBD Leaderboard stocks are exploring new buy points and buy zones, including OLLI, SHOP and CRM as well as the following Magnificent Seven stocks.
In addition to new setups by DraftKings and ServiceNow, Amazon stock is clearing a double-bottom base showing a 134.48 entry. The mega cap’s base is shorter than the minimum length of seven weeks, but just by one day. Yet Amazon has shaken off that flaw and now trades near the top of its buy range, which extends to 141.20.
Nvidia stock recently cleared a shakeout + 3 entry near 440-445 and bounced back above its 50-day moving average. A new double bottom continues to form, which may produce another buy point at 476.09. A trendline could also offer an new entry.
On Monday, Nvidia was featured as the IBD Stock Of The Day.
Note that the graphics and artificial intelligence chip stock powerhouse is on tap to report earnings Nov. 21.
Joining fellow Magnificent Seven stocks in riding the market’s up bullish action, Microsoft has climbed well past an aggressive entry at 340.86. MSFT stock is also forming a new handle buy point with its relative strength line back on the upswing. The current formation is an early stage pattern, giving it a higher likelihood of success. Microsoft earns a spot on the IBD Long-Term Leaders list.
Meta stock briefly cleared a 326.20 buy point in a flat base ahead of earnings, but that breakout failed to gain traction. After dropping below its 50-day moving average on earnings on Oct. 25, the Facebook, Instagram and WhatsApp parent quickly bounced back to retake that benchmark line.
The social network has begun a strong turnaround in earnings after earlier announcements of job cuts. In its latest report, Meta posted earnings per share of $4.39, a 168% gain over the prior-year quarter. Sales growth also accelerated, jumping 23% to $34.1 billion for the period.
Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
YOU MAY ALSO LIKE:
Meta Platforms Leads Five Stocks Near Buy Points, Flashing Bullish Signals
Top Funds Don’t Think The AI Boom Is Over. This List Proves It.
How To Handle Changing Stock Market Trends
IBD Leaderboard Highlights The Best Stocks To Buy And Watch
