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Today’s Summary
Wednesday, January 20th, 2021
Indices: US Stocks continued to rise in today’s session, with all four major indices closing at an all-time high. The Dow Jones Industrial Average gained 258 points or 0.83%. The S&P 500 and Nasdaq moved higher by 1.39% and 1.97%, respectively. Small-Caps underperformed but still rose 0.44%.
Sectors: 10 of the 11 sectors closed higher. Communications led, gaining 3.14%. Financials lagged, falling 0.42%.
Commodities: Crude Oil futures rose 0.62% to $53.31 per barrel. Gold futures moved higher by 1.43% to $1,867 per ounce.
Currencies: The US Dollar Index inched lower by 0.07%.
Interest Rates: The 10-year US Treasury yield slipped to 1.085%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
The recent outperformance from Small-Caps was definitely a bullish development, but let's not forget who the secular leaders are… $MSFT $AAPL $GOOGL $AMZN #MAGA pic.twitter.com/4pWLP0LJuU
— Steven Strazza (@sstrazza) January 20, 2021
Today’s Chart of the Day was shared on Twitter by Steve Strazza (@sstrazza). It’s a custom index that Steve calls the MAGA Index. No, not that MAGA…we’re talking about an equally weighted basket of the four largest companies in America; Microsoft, Apple, Google, and Amazon. These four stocks all have market-caps over $1-trillion. Combined, they account for over 30% of the Nasdaq and about 20% of the S&P 500. In a comment to The Chart Report, Steve said, “The recent strength in Small-Caps did a lot to help buoy the broader market over the past few months while Mega-Caps corrected. When these sleeping giants wake up, they tend to lift the major indices higher because of their weight. A potential rotation back into these former leaders could be the catalyst for the next leg higher. It may seem like a crime to leave out $FB and $NFLX, but I wanted to isolate the biggest of the big and you’d be surprised at how insignificant $FB and $NFLX are compared to the MAGA names. Why bet against the market when its largest components are just starting to break out like this?”
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Quote of the Day
“The public is often right during the trends, but wrong at both ends.”
– Humphrey B. Neill
Top Links
Another Week, Another Speculative Record – SentimenTrader
Jason Goepfert highlights the latest signs of froth in the market.
Strong Breadth > Excessive Optimism – All Star Charts
JC Parets offers his take on market sentiment.
They’re on Fire – The Irrelevant Investor
Michael Batnick weighs-in on the recent outperformance from Small and Micro-Cap stocks.
Mid-Week Market Update – Chaikin Analytics
Dan Russo shares his thoughts on the current market environment.
Bitcoin and Ethereum Near Record Highs: What’s the Next Trade? – Forex.com
Matt Weller analyzes price action in the Crypto space.
Top Tweets
All-Time High pic.twitter.com/LAuuFBhMM4
— Eddy Elfenbein (@EddyElfenbein) January 20, 2021
NASDAQ breadth continuing to broaden out … % of members above 200d moving average now at highest since February 2004 pic.twitter.com/MbkDyjbj4c
— Liz Ann Sonders (@LizAnnSonders) January 20, 2021
$QQQ vs. $SPY five-month sideways. Favoring upward resolution, as "rotation memo" seems fully received. pic.twitter.com/njeJQCn2vM
— Mark Ungewitter (@mark_ungewitter) January 20, 2021
False breakdown in the “generals”?
Big implications if these guys get involved… #meltup$FAANG $MSFT $GOOGL $NFLX pic.twitter.com/PAR2uGa839
— J4 (@J4_doji) January 20, 2021
Look who is leading FAANG out of the long consolidation….Google and Netflix…
Both in my 8-80 portfolio and tempted to add to both $goog $nflx https://t.co/IrOKKOJRCx pic.twitter.com/jJyzAVIS3c
— Tiny Bubbles… (@howardlindzon) January 20, 2021
And just like that.. in space of 2 days… Communications stocks all of a sudden look rather attractive.$XLC $FB $NFLX $GOOG $TMUS pic.twitter.com/iuQKPIxdrY
— Sam McCallum (@honeystocks1) January 20, 2021
Quite a divergence going on between the Nasdaq and semiconductors today. pic.twitter.com/ZPffw2JOvD
— Bespoke (@bespokeinvest) January 20, 2021
We're receiving blowback on our bullish dollar view as seen on @MadMoneyOnCNBC w/ @jimcramer last night). The dissent makes me like the idea a little more 🙂 This is the chart we are looking at. Specs are heavily short; eventually, they will want to cover (buy). #Dollar #DX pic.twitter.com/6cwFvngDoe
— DeCarleyTrading.com (@carleygarner) January 20, 2021
Emerging market #equities are outperforming US equities during the last 30 days, another sign rotation is continuing. pic.twitter.com/zYfVM2Y5fm
— jeroen blokland (@jsblokland) January 20, 2021
Big momentum for Hong Kong. pic.twitter.com/eN2pKXZ4iC
— Strategas (@StrategasRP) January 20, 2021
Maybe the most important charts for you asset allocators out there…2-year relative breakout in MSCI EM ($EEM) vs MSCI World ($ACWI). pic.twitter.com/38bBg2vALt
— RenMac: Renaissance Macro Research (@RenMacLLC) January 20, 2021
Emerging markets finally emerged.
$EEM closed at a new all time high. pic.twitter.com/lXhPYU8OT2— Stocktwits (@Stocktwits) January 20, 2021