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Momo Shifts To High-Risk Stocks
Please click here for a chart of Nasdaq 100 ETF (QQQ).
Note the following:
- The chart shows that most of the damage to the stock market was done in the premarket.
- The momo crowd has shifted to buying high-risk momo stocks.
- There is logic to the momo crowd’s strategy. If the only factor was interest rates, it makes sense to buy high-risk stocks because interest rates have fallen and bonds have risen. With lower interest rates, the present value of future earnings is higher.