“FOMO” Trade in Deceleration Mode

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Commentary Analysis

  • Comments: US stock markets ended an unimpressive session in positive territory and continued to consolidate their recent upleg. The wide breadth of positive earnings and a better than expected GDP report for Q1-2021 had little impact. In fact more signs of distribution selling appeared. Approximately 73% of today’s total volume in my “Mega-Cap Universe” (a combination of SP-100 and Nasdaq-100 components) exhibited bearish volume patterns. Furthermore, the disproportionately large number of new 5-day highs accompanied by contracting volume confirms that the FOMO trade is in deceleration mode.
  • Equities:
    • US Markets: SP-500 (SPY) and Nasdaq-100 (QQQ) recorded new highs.
    • Leading Sectors: Communications (XLC); Financials (XLF); and Energy (XLE)
    • Lagging Sectors: Healthcare (XLV); and Technology (XLK)
    • Int’l Markets: Europe Vanguard (VGK) and Pacific Ex-Japan (EPP) recorded new highs. Japan (EWJ) is trending downward and testign support @ double bottom.
    • Volatility: VIX (VXX) recorded a new low.
  • Large-Cap Volume Surgers:
    • Ebay Inc (EBAY): -10.03% on 341% volume surge
    • Lyft Inc Cl A (LYFT) -9.94% on 292% volume surge
    • Ford Motor Co (F) -9.41% on 239% volume surge
    • Teladoc Health Inc (TDOC) -8.29% on 224% volume surge
    • Facebook (FB): +7.30% on 173% volume surge
    • Dish Network (DISH): +8.32% on 142% volume surge
  • Small-Cap Volume Surgers:
    • Vaxart Inc (VXRT) +9.12% on 853% volume surge
    • Coeur Mining (CDE): -14.36% on 153% volume surge
    • Pitney Bowes Inc (PBI): -10.17% on 113% volume surge
    • Spirit Airlines (SAVE): +1.68% on 172% volume surge
    • Hecla Mining Co (HL): -6.51% on 40% volume surge
  • Market Moving Events:
    • Earnings / Consumer Discretionary: McDonald’s / MCD (+1.20%) exceeded estimates.
    • Earnings / Technology: Apple / AAPL (-0.07%) and Qualcomm / QCOM (+4.47%) exceeded estimates.
    • Earnings / Communications: Facebook / FB (+7.30%) exceeded estimates.
    • Earnings / Healthcare: Missing estimaates was Merck / MRK (-4.42%).
    • Earnings / Industrials: Caterpillar / CAT (-2.08%) missed estimates.
    • Fiscal Stimulus: President Biden presented $1.8tn American Families Plan before Congress, which Senate Democrats may opposed due to higher taxes.
    • Economic Growth /GDP (q/q) (Q1-2021): @ 6.4% vs estimates @ 6.1% and prior @ 4.3%.
    • Economic Growth / GDP Price Index (q/a) (Q1-2021): @ 4.1% vs estimates @ 2.5% and prior @ 1.9%.
    • Labor / Unemployment Claims: @ 553k vs estimates @ 549k and prior @ 566k.
    • Real Estate / Pending Home Sales (m/m) (Mar-2021): @ 1.9% vs estimates @ 5.0% and prior @ -11.5%.
  • Bond Rates: The 10-Year Treasury yield closed @ 1.64 (+0.02bps / +1.23%).
    • Treasury Inflation Protection (TIP) trending upward in bullish channel.
    • High Yield (HYG) makes a bullish breakout after 4 previous days of consolidation.
  • Currencies: US Dollar (UUP) remains in downtrend while Euro (FXE) advances. Yen (FXY) is trending lower but attempting to find support.
  • Cryptocurrencies: Grayscale Bitcoin (GBTC) signaled a key bearish reversal with a new 4-day low. Ethereum (ETHE) remains in an uptrend and may be initiating a correction at this level.
  • Commodities: DB Commodities ETF (DBC) remains in bullish trend but encountering resistance. Gold (GLD) is consolidating while US Oil (USO) has resumed uptrend but must clear resistance @ March-2021 high to confirm advance will continue.
  • Real Estate: YTD, this group (IYR, ITB and REZ) has been represented amongst market leaders. Short-term trends remain bullish but are overbought and could initiate a consolidation phase.

ETF Daily Market Performance Summary: 29-April-2021

etf daily market summary for stocks, bonds, currencies, cryptocurrencies, commodities, real estate, and equity sectors
Click to enlarge

Market Diary: 29-April-2021

market diary summary for NYSE and Nasdaq exchanges: advancers, decliners, new highs and new lows, plus mega-cap market breadth
(Click table to enlarge)

Covid19 Global Status Update: Top 5 New Cases in Last 7 Days

The situation in India still remains dire and Brazil has reversed its downward trend for now. The USA, once a surging hotspot, continues to show signs of improvement along with Turkey and France. However, the bottom line is that World infection rates are rising and will not likely subside until India is brought under control.

RankCountryCases last 7 daysCases previous 7 daysWeekly % Chg
World5,797,4884,651,635+3%
1India2,497,6751,969,56927%
2Brazil420,747414,046+2%
3USA382,725450,192-15%
4Turkey287,318414,425-31%
5France183,784220,727-17%

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