Due to tech selloff and retail friends getting skittish, I’m making this note public to help my readers who got caught off guard by the Mega Dow Sector Rotation that has trampled Semiconductors.
I will send out two emails today, one will be a Qualcomm DCF Conclusion Study (just sent). The other one (this one) is a quick comment on the market.
Today is a continuation of the Sector Rotation theme that we’ve been planning for last week (where Dow is strong // NQ Tech is weak).
In my opinion, current weakness in tech is technical-driven due to rebalancing. This entire week is quarter-end rebalancing so some more this activity may persist. It’s premature to say that tech has topped out for all 2024.
While tech takes its time to cool off, I have a few ETFs on my watchlist that I think has some long-term upside. These offer diversifying effects to a core S&P 500 and tech portfolio.
XOP Oil ETF: I think that 142-146 is an area where larger investors may be buying to break out of a downtrend. Once this downward trendline is broken in XOP ETF, I expect it to go a lot higher longer term. This will take time. As long as we are above 140-141, I think XOP has potential. Beneath 140-141, we have to be a bit more patient with its recovery.
GLD (Gold) ETF: Gold is well off its 2024 highs, but macro forces that suggest Fed tightening has its limits means that there is “macro support” for Gold. Unless Gold GLD ETF closes below 210 with several Daily closes, I believe the long term direction for it is higher. Even if Gold sees weakness in the short-term, in the long-term, it goes higher from today’s level. So 210 is really a trader’s line in sand. Investors don’t really need to worry about short term softness. I think it goes Higher long term.
About 85% of my Dow names list has performed to my targets. Don’t you love it when you see Green when markets are Red?
Now that this train has boarded, the next one will take its time to arrive at the station. Don’t chase the Dow rally. We’re in from lower, so we have flexibility.
If the market sudden decides to stage a reversal, don’t be afraid to exit with profits first and re-enter later.
If we get a couple more days of extreme semiconductor weakness, I would be prepared to buy a tradable bounce. Qualcomm’s DCF conclusion study sent out earlier gives a good idea of how much cooling-off would be needed before there is (safer) entry.
Important Links (Organized DCF Conclusion Studies By Indices)
Semiconductor SOXX ETF Top Stocks DCF Conclusion Studies (Newly Added - will add the other SOXX names in here shortly): https://larrycheung.substack.com/t/soxx-etf-top-10-dcfs
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6/24 Daily Plan: Quarter-End Rebalancing
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Hey Everyone,
Due to tech selloff and retail friends getting skittish, I’m making this note public to help my readers who got caught off guard by the Mega Dow Sector Rotation that has trampled Semiconductors.
I will send out two emails today, one will be a Qualcomm DCF Conclusion Study (just sent). The other one (this one) is a quick comment on the market.
Today is a continuation of the Sector Rotation theme that we’ve been planning for last week (where Dow is strong // NQ Tech is weak).
In my opinion, current weakness in tech is technical-driven due to rebalancing. This entire week is quarter-end rebalancing so some more this activity may persist. It’s premature to say that tech has topped out for all 2024.
While tech takes its time to cool off, I have a few ETFs on my watchlist that I think has some long-term upside. These offer diversifying effects to a core S&P 500 and tech portfolio.
XOP Oil ETF: I think that 142-146 is an area where larger investors may be buying to break out of a downtrend. Once this downward trendline is broken in XOP ETF, I expect it to go a lot higher longer term. This will take time. As long as we are above 140-141, I think XOP has potential. Beneath 140-141, we have to be a bit more patient with its recovery.
GLD (Gold) ETF: Gold is well off its 2024 highs, but macro forces that suggest Fed tightening has its limits means that there is “macro support” for Gold. Unless Gold GLD ETF closes below 210 with several Daily closes, I believe the long term direction for it is higher. Even if Gold sees weakness in the short-term, in the long-term, it goes higher from today’s level. So 210 is really a trader’s line in sand. Investors don’t really need to worry about short term softness. I think it goes Higher long term.
About 85% of my Dow names list has performed to my targets. Don’t you love it when you see Green when markets are Red?
Now that this train has boarded, the next one will take its time to arrive at the station. Don’t chase the Dow rally. We’re in from lower, so we have flexibility.
If the market sudden decides to stage a reversal, don’t be afraid to exit with profits first and re-enter later.
If we get a couple more days of extreme semiconductor weakness, I would be prepared to buy a tradable bounce. Qualcomm’s DCF conclusion study sent out earlier gives a good idea of how much cooling-off would be needed before there is (safer) entry.
DCFs alone aren’t enough. Technicals alone aren’t enough. Macro alone isn’t enough.
Combined though? Ah, they make one powerful force for the traders/investors in my Community.
-Larry
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Important Links (Organized DCF Conclusion Studies By Indices)
Semiconductor SOXX ETF Top Stocks DCF Conclusion Studies (Newly Added - will add the other SOXX names in here shortly): https://larrycheung.substack.com/t/soxx-etf-top-10-dcfs
DOW Top Stocks DCF Conclusion Studies:
https://larrycheung.substack.com/t/dow-etf-top-10-dcfs
QQQ ETF Top Stocks DCF Conclusion Studies: https://larrycheung.substack.com/t/qqq-etf-top-10-dcfs
SPY ETF Top Stocks DCF Conclusion Studies: https://larrycheung.substack.com/t/spy-etf-top-10-dcfs