A very promising start to the trading week, which saw the indexes surge higher by 5%, was somewhat washed away by last Friday’s post Jobs Report sell-off. And while the steep declines Friday were worrisome, big picture the S&P 500 still managed to gain 1.5% on the week, the Dow rallied 2%, and the Nasdaq added 0.7%.

Gold and silver have been under pressure from a strong dollar and higher interest rates, but there are signs that the metals’ dollar-related woes may be in the process of changing for the better. The global de-dollarization trend is a case in point, as we’ll discuss here.

Elsewhere, steel and copper are both trying to establish bottoms and are getting some help from a resurgent auto industry.


In the trading portfolio, no new positions are recommended for now as the broad financial market remains unsettled (with increased spillover risk into the metals).

A very promising start to the trading week, which saw the indexes surge higher by 5%, was somewhat washed away by Friday’s post Jobs Report sell-off. And while the steep declines Friday were worrisome, big picture the S&P 500 still managed to gain 1.5% on the week, the Dow rallied 2%, and the Nasdaq added 0.7%.

A very promising start to the trading week, which saw the indexes surge higher by 5%, was somewhat washed away by Friday’s post Jobs Report sell-off. And while the steep declines Friday were worrisome, big picture the S&P 500 still managed to gain 1.5% on the week, the Dow rallied 2%, and the Nasdaq added 0.7%.

It’s going to be a fairly busy week for trading.

We have four positions that are due to expire at the October 21, 2022 expiration cycle, three of which have little to no premium. As a result, I intend to buy back our calls in GDX, BITO, and KO on Monday or Tuesday. I’ll plan on doing the same in our PFE calls that are due to expire October 28.

My hope is to add several more positions to the Income Wheel portfolio this week as opportunities are plentiful.

Earnings season is finally upon us.

This week offers up a few potential trading opportunities, particularly in the big banks. JPMorgan (JPM), Morgan Stanley (MS), Citigroup (C), Wells Fargo (WFC) and US Bank (USB) are the big announcements on the docket and the companies I will be focusing on.



I also want to remind everyone that we will have a subscriber-exclusive webinar every Friday during earnings season, so make sure to sign-up when you get an opportunity.

There were a few positives last week, including some intriguing early-week strength, with some very powerful breadth, and, even with the slide of the past couple of sessions, far fewer stocks were hitting new lows compared to a couple of weeks ago. Given how everyone is leaning bearish, there’s plenty of upside potential if the market can catch a spark, but the jobs report-induced selling reinforces the pattern of selling on each and every rally. Long story short: While our eyes are open, nothing has changed with the major evidence. We’ll stick with a level 3 on our Market Monitor.


This week’s list is heavier on energy and medical areas, though our Top Pick is a name that should benefit from higher rates. As usual, though, we think aiming for dips is the right move.

Stocks continue to slide, prompting us to add some more safety to the Stock of the Week portfolio in the form of a gold mining stock recommended by Sector Xpress Gold & Metals Advisor analyst Clif Droke this week. It’s one of the few gold miners that’s actually growing revenues, and is in fact the only stock Clif is currently recommending. It also may benefit from ongoing global efforts at “de-dollarization.”


Details below.

Nothing new here. The song remains the same; the market continues to suffer. But, as I stated last week, while most portfolios across the investment universe have taken a turn for the worse, our Quant Trader portfolio continues to demonstrate why it’s a necessity to have exposure to options selling strategies.

Our win ratio stands at 90.9% and our cumulative return stands at over 40%.



We now have one open position for the October expiration cycle, our IWM iron condor, and three new positions due to expire November 18, 2022. Of course, I have no intent of holding on for that long and will gladly take profits early if possible.

From a top-down perspective, there are some rays of light out there--some of this week’s up volume has been very rare, and it comes on the heels of an onslaught of pessimism. That said, none of our indicators have flashed green, and the biggest thing we’re still seeing is selling on strength--this week, Enphase cracked and forced us to sell. We are adding two half-sized positions tonight in stocks from our watch list, but we’re remaining defensive with 78% in cash.


Elsewhere in this issue, we write about our Aggression Index and how it usually leads market bottoms--and how it’s showing interesting action in recent months. We also highlight many stocks that we’d love to own if the market gets going--we have our shopping list ready, but as always, have to see it first before any major buying.

The market has been trying to climb off its knees this week as we’re finally getting some solid evidence that both inflation and the job market are cooling.

In a seemingly odd twist, in the short term what’s bad for the economy is probably good for the stock market. While that doesn’t mean we’re out of the woods just yet, I’m going to up our risk profile slightly with a potential big winner in the battery industry.

This company is currently qualifying batteries for wearable technologies and expects to move into more consumer markets, as well as the EV market, in the coming years. All the details are inside the October Issue.

Enjoy!

The market’s relentless march ever higher is being interrupted. What’s going on?

Investors have started to see a cloud or two in an otherwise sunny stock market sky. We don’t focus much on short-term market moves, but we have noticed that the weather is shifting, at least slightly.

During his 30+ year career, my dad was a professional investor in Boston, Massachusetts. He worked for several firms, but always specialized in managing value portfolios worth hundreds of millions of dollars for institutional clients. I am lucky that he’s a great teacher and enjoyed passing along his investing wisdom over the years.

The market is still in an uptrend and not far from the highs. But things are changing.

Today’s note includes earnings updates, ratings changes and the podcast.

This has been another tough week for most growth-oriented small cap stocks as the sellers have clearly taken control. There are easy targets to point to as driving the decline, namely fear of inflation. But the reality is it is mostly just a lot of uncertainty about the path of the recovery that’s likely driving the selling. And the fact that most stocks are still up very nicely over the last twelve months, meaning a lot of room for profit taking.

Remain defensive. Growth stocks remain under severe pressure, and today notwithstanding, that selling is starting to spread to the broad market (our Cabot Tides are on the fence).

It looks like the relentless bull market is finally running into trouble. The market indexes are down a lot for the third straight day.

We’ve seen signs of it everywhere. Retail prices for homes, apartments, food, gasoline, cars and everyday services are higher than they were a year or two ago and are going higher. Upstream from these consumer-facing prices, input prices for raw materials, semiconductors, crops, wages, energy and transportation are going up. Inflation is no longer around the corner – it is here.

Today’s note includes earnings updates, ratings changes and the podcast.

Cloudflare (NET) earnings are out today as sector rotation and scrutiny of SPAC-acquired target company valuations continue. Electric vehicle (EVs) stocks are struggling a bit and could be presenting us with attractive entry points.

Things are still great. The market indexes are either making new all-time highs or within a whisker of them. The uptrend continues ahead of what is sure to be a booming economy in the months ahead.

The top five holdings in this fund are ViacomCBS Inc Class B (VIAC, 3.01% of assets), Wells Fargo & Co (WFC, 2.27%), LyondellBasell Industries NV (LYB, 2.23%), Prudential Financial Inc (PRU, 2.23%), and Marathon Petroleum Corp (MPC, 2.22%). The fund has a current annual dividend yield of 3.35%, paid quarterly.

Wall Street expects this gaming company will increase its annual earnings by 30.18% over the next five years.

The market remains messy and is acting in a one step forward, two steps back fashion, at least where growth stocks are concerned. As of early afternoon today it looks like many of our stocks are testing their lows from earlier this month.

Growth stocks have come under renewed pressure in recent days as the Nasdaq’s recent rally attempt has hit a wall, with a few former leaders already testing their lows. We’ve been cautious for three weeks now, and tonight, we’re going to sell one of our remaining positions.

This utility is expected to grow earnings at an annual rate of 22.90% over the next five years. The shares have a current annual dividend yield of 3.47%, paid quarterly.

The marijuana sector, in general, remains in a correction. The high for the sector was six weeks ago, while the most recent bottom was two and a half weeks ago.

Accolade revealed preliminary Q4 and full-year 2020 results after the bell yesterday and announced a private offering of $250 million convertible notes, with a $37.5 million option (pricing to be determined). The reasons for the offering are the usual – working capital, acquisitions, strategic investments and general corporate purposes.

The shares of this airline were recently upgraded by Deutsche Bank to ‘Buy.’

BioLife (BLFS) reported Q4 results yesterday after the close that surpassed revenue expectations. Revenue was up 77.5% to $14.7 million (beating by $1.2 million) while adjusted EPS of -$0.01 was in-line. For the full-year 2020 revenue was up 76% to $48.1 million, driven largely by Media products, which grew by 32% to $31 million.

This containership company beat analysts’ estimates by $0.05 last quarter, and it is expected to grow earnings at an annual rate of 16.5% over the next five years.

The Dynatrace (DT) March 55 call that we sold last month for $4.60 expired worthless on Friday. This was a totally fine situation, and our position is at a small profit.

New business is pushing shares of this flight simulator up, up, and away.

Our Cabot Top Ten Trader’s market timing system consists of two parts—one based on the action of three select, growth-oriented market indexes, and the other based on the action of the fast-moving stocks Cabot Top Ten features.