Hey!
Welcome to another edition of our Nasdaq-100 Weekly roundup. This week, we've seen some interesting shifts in the market landscape, with old favorites making comebacks and tech giants flexing their muscles once again.
Table of Contents
Winners
Starbucks (SBUX) +23.89%: Talk about a caffeine rush! Looking back at our historical data, this surge is particularly noteworthy. Just two weeks ago, SBUX wasn't even on our radar. This dramatic turnaround suggests a potential shift in investor sentiment towards consumer discretionary stocks. There's still life in consumer stocks. This aligns with recent positive retail sales data and could signal improving consumer confidence.
NVIDIA (NVDA) +17.17%: Our AI darling has been a consistent presence in our top performers list. This week's gain further solidifies its position as a market leader in the AI space.
Micron Technology (MU) +15.99%: Its strong performance aligns with the broader trend we're seeing in semiconductor stocks, particularly those with exposure to AI and data center markets.
Losers
Charter Communications (CHTR) -3.05%: This dip comes after CHTR's strong performance in recent weeks. It's worth noting that despite this setback, CHTR remains up significantly from its lows earlier this year.
Diamondback Energy (FANG) -2.92%: FANG's decline might be reflecting broader concerns about energy demand in the face of economic uncertainties.
CSX Corporation (CSX) -1.82%: Transportation stocks like CSX often serve as economic bellwethers. This slight dip could be signaling some caution about economic growth prospects.
Most Active
Warner Bros. Discovery (WBD): WBD has been a fixture in our most active list for weeks now. The sustained interest could be related to ongoing speculation about industry consolidation and the company's streaming strategy.
Intel (INTC): The old guard of tech isn't ready to be put out to pasture just yet. INTC's high trading volume, coupled with its recent earnings miss and subsequent stock decline, suggests investors are still digesting the company's turnaround prospects. The semiconductor story is getting more nuanced, with clear winners and losers emerging.
NVIDIA (NVDA): Predictably, with presence in both our top gainers and most active lists means NVDA is irreplaceable in the ongoing AI narrative.
QQQ Short-Term Analysis
Don’t understand the chart? I explain how it works in this post.
Technical Analysis 🟨
Closing Price: QQQ closed at 475.22 on August 16, up from 450.3506 on August 9. That's a solid 5.52% gain in a week, showcasing strong momentum.
Trend Indicators: We see what remains of the bullish trend, but the the narrowing gap between TEMA and DEMA suggests potential consolidation or correction ahead.
Momentum: The Relative Strength Index (RSI) is at 73.80, indicating overbought conditions. However, in strong uptrends, RSI can remain elevated for extended periods.
Trend Strength: The Average Directional Index (ADX) at 48.56 indicates a very strong trend. While it's dropped slightly from earlier in the week, it's still well above the 25 level, suggesting the uptrend remains intact.
Overall, the QQQ is showing strength, but we're seeing signs of potential consolidation ahead. Keep your eyes peeled for a possible pullback or sideways movement in the coming days.
Market Context 🟩
Economic strength: Retail sales surged 1.0% last month, beating the 0.4% forecast. Jobless claims hit a 5-week low. Consumer spending looks robust despite recession fears. 🟩
Earnings beating expectations: Tech and retail giants are outperforming. Cisco's strong report and Walmart's raised guidance reflect broader market strength. 🟩
Fed rate cut expectations shift: The market now prices in a 25 bp cut for September, down from earlier 50 bp expectations. This could introduce some volatility. 🟨
Mixed sector performance: Chip stocks show varied results, with NVIDIA still rallying. Consumer discretionary stocks are showing notable strength. 🟩
The Bottom Line: QQQ's outlook is bullish, but expect increased volatility. We've got positive momentum from economic data and earnings, but the Fed's stance could keep things interesting.
Looking Ahead
Keep your eyes peeled on these key areas:
Consumer Sentiment: With Starbucks' surge, watch for other consumer discretionary stocks to potentially follow suit. This could signal a broader shift in market sentiment.
Tech Sector Dynamics: We're seeing a interesting mix of established tech giants regaining momentum alongside continued AI enthusiasm. Watch for potential rotation within the tech sector.
Economic Indicators: Transportation stocks' weakness could be an early warning sign. Keep a close eye on upcoming economic data releases for confirmation or contradiction of this trend.
AI Reality Check: As the initial AI hype starts to normalize, focus on companies that can demonstrate tangible AI applications and revenue growth.
Media Consolidation: With WBD consistently in the spotlight, watch for any news or rumors about potential mergers or acquisitions in the media space.
That's all for this week's Nasdaq roundup. But hold onto your hats! Make sure to check back on Monday for an in-depth analysis of our top winner (SBUX), biggest loser (CHTR), and most active stock (WBD). We'll dig into what's driving these moves and what it might mean for your portfolio.
Below, Member’s Only section, I discuss my further analysis of QQQ with potential plays. If you can’t access it, consider getting a 7-day free trial (no credit card required!):