Momentum Monday - Goldman Sachs All-Time Highs ...Let The Pillaging Begin

Quite a few tech stocks were getting weaker going into the FOMC meeting last week. The premise was that higher inflation might be back and the Fed will likely be more hawkish in their remarks. None of that happened. The Fed confirmed its plan to reduce interest rates by 75bps this year and more in the next year. Stocks had another significant bounce, led by small caps, financials, and retailers.

Semiconductors also had a decent bounce but for a different reason. Micron (MU) crushed earnings estimates and inspired a rally across the board. NVDA quickly recovered from its dips to its rising 20-day EMA and it is back near its all-time highs. Ditto for QCOM. COHR bounced near its 50dma and it is also looking constructive. Ditto for AVGO. Semiconductors remain the leading sector. The dips in chips continue to get bought. 

The second best-performing major sector year-to-date is financials. All the talk about nightmare drops in commercial real estate prices and financials didn’t even blink. So much strength across the board – JPM, GS, etc.

Earnings season is basically, over. Typically retailers are the last to report. It has been a mixed picture there – while LULU, NKE, DG sold off, others like WSM, ARHS, TGT, GPS gapped up and followed through. Tech stocks are the ones having issues with following through lately. Look at MU, ORCL, DELL, IBM, CRWD for example. Those gaps were used by some to take profits.

The IPO market is finally back in the news. RDDT and ALAB were the crowd’s favorites. I am not chasing any of them. I rather wait a few weeks or even months and see if they set up properly. This is what I did with CAVA and CART and it worked out well.