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Momentum Monday - Open AI at War With Itself? Tech Going Strong and the Price and Popularity Lists

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Good morning..

AI is having itself a year, and this weekend felt like TWO as OpenAI fired, hired and fired Sam Altman who is now heading Microsoft’s AI team. It’s like Downtown Abbey but for AI.

I dive into it all with Ivanhoff in this weeks episode and share some new odeas.

You can watch this weeks episode of Momentum Monday and last weeks episode of Trends with Friends on my YouTube. It is easy to subscribe and if you do every Sunday you will get an alert when we post the show.

Riley’s Corner:
Here’s Riley’s screen that tracks new 52-week highs and lows sorted by the total followers on Stocktwits. For those unfamiliar, here’s the gist, 

In uptrending markets the least followed stocks with the highest relative strength are most interesting to me.

In downtrending markets, the most followed stocks with the weakest price relative strength are most interesting to me.

Riley shared a few words on this week’s results…

New Highs led New Lows — 166 vs. 6.

Some notable names,

Williams-Sonoma ($WSM) is the New High Standout of the Week. The home products provider propelled +20.55%. On Thursday, $WSM reported earnings and raised its 2023 operating margin outlook.

Wingstop ($WING) is a notable new high. The fast-casual chicken restaurant rallied 9.20% and closed at an all-time high.

Uber ($UBER) is a notable new high. The modern age transportation company carried +5.54% and closed at a 2 year high. $UBER is up 15.83% since its Q3 earnings release.

Ferrari ($RACE) is a notable new high. The luxury automaker raced 5.83% and closed at an all-time high. The stock is up 12.65% since its record earnings report.

Arcellx ($ACLX) is a notable new high. The $2B clinical-stage biotech flew 21.31%. The company announced an expanded partnership with Kite, a Gilead Company. $ACLX received a $200M equity investment at $61.68 per share and $85M cash.

GoDaddy ($GDDY) is a notable new high. The web service provider surged 5.09% and closed at a weekly all-time high. $GDDY is up 18.27% since its Q3 earnings report.

Lumiar Technologies ($LAZR) is the New Low Standout of the Week. Last week, the Lidar developer dropped -9.43% and settled at a new weekly low.

Kroger ($KR) is a notable new low. The grocery and convenience retailer lost -2.66% and closed at its lowest weekly price since Oct. 2022. $KR is scheduled to report earnings Thursday, November 30th BMO.

​​Fisker ($FSR) is a notable new low. The EV maker unplugged -36.72% and closed at an all-time low. On Monday, Fisker finally reported earnings. Friday, the company updated its distribution strategy. $FSR fell -40.88% following its earnings release.

Click here for the full weekend review.


Here are Ivanhoff’s thoughts:

As expected, small caps finally joined the rally attempt. They have been super-volatile, to put it mildly. It’s in their nature. Two weeks ago IWM had a big rally to its 50dma and then pulled back in the following few days. Last week, IWM had a strong rally on huge volume to its 200dma and then pulled back a little on lighter volume. After all was said and done, IWM still made a few higher lows and higher highs. It is starting to work on an uptrend, which will be somewhat confirmed if it starts to rise above its 200dma for more than a day or two. If this happens, all the worries about market breadth will slowly disappear. Market participants’ attention will shift from the mega-caps to the more speculative mid, small, and micro-caps which tend to move much faster, in both directions. 

In the meantime, earnings breakouts from various sectors continue to follow through – PLTR, DKNG, SHOP, DIS, etc. The mega-caps are acting constructively. AMZN, META, MSFT, and NVDA are hovering near their 52-week highs. AMD is working on the right side of a new base. TSLA is the only one still struggling below its declining 50-day moving average but even they are making higher lows and higher highs in the past couple of weeks. It’s interesting that lately TSLA is much better correlated with the small-cap index Russell 2k than with the Nasdaq 100.

The next trading week is shortened due to Thanksgiving. I hope you have a wonderful time with your family if you are celebrating. One big earnings event to be aware of is on Tuesday after the market close – the undisputed momentum leader of this year reports – NVDA. They have the potential to rattle the speculative juices of the market.

Have a great week.

Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. For full disclosures, click here.

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