To gain an edge, this is what you need to know today.
Google Antitrust Case
The U. S. Justice Department is filing an antitrust lawsuit against Google (GOOG). Let’s explore the key points with the help of a chart.
Please click here for a chart of Google stock.
Note the following:
- The chart compares Google stock with S&P 500 ETF (SPY), Facebook (FB) stock, Amazon (AMZN) stock and Apple (AAPL) stock.
- The lawsuit appears to be focused on search.
- Google controls 90% of the search market in the United States.
- Google has a much larger share of search on mobile. Google pays about $8 billion a year to Apple to be the search default. Of course, Google is the default search on Android.
- Google also has dominance in technology for online advertising.
- This was expected and in theory, should have already been discounted in the price.
- An antitrust suit against Facebook may also be filed in the future.
- Amazon (AMZN) and Apple (AAPL) also have antitrust risk.
- Out of an abundance of caution, buy zones and Buy Now ratings are being temporarily suspended for GOOG and FB.
- For the time being, buy zones and Buy Now ratings remain valid for AMZN and AAPL but at the risk of being suspended in the future.
- The chart shows the Arora call to protect portfolios in late January due to the virus at a time when the stock market was ignoring the virus.
- The chart shows that a number of stocks fell into Arora buy zones during the March swoon giving investors great opportunities to buy them.Buy zones are very powerful. When a stock dips into the buy zone you buy it. If you were following the buy zones, you could have more than doubled your money in Apple (AAPL) stock. Earlier in 2020, Apple dipped into the buy zone as low as $53.01. Since then Apple stock has traded as high as $137.98. This represents a return of 160% in a matter of months.With the help of buy zones you could have bought Microsoft (MSFT) stock as low as $132.52 . Since then Microsoft stock has traded as high as $232.86.
The sum of the parts of all of GOOG and FB may turn out to be higher than where the companies are trading. However, if these companies are not broken up but become severely restricted in how they are allowed to operate, the stock of these two companies may be adversely affected.
In the case of Apple and Amazon, the sum of the parts may be less than where the stocks are presently trading. However, the government seems to be less concerned about Apple and Amazon at this time.
For details of What To Do Now on Google, Facebook, Amazon and Apple, there will be a separate post on ZYX Buy.
Regarding the internet ETF FDN, there will be a separate post on ZYX Global.
The housing market is hot. Housing Starts came at 1.415 M vs. 1.43 M consensus.
Housing Permits came at 1.553 M vs. 1.51 M consensus. Housing permits are a leading indicator — the data is very positive.
There is optimism that both sides will reach a stimulus deal.
Momo Crowd And Smart Money In Stocks
The momo crowd is 🔒 (To see the locked content, please take a 30 day free trial) stocks in the early trade. Smart money is 🔒.
The momo crowd is 🔒 gold in the early trade. Smart money is 🔒.
For longer term, please see gold and silver ratings.
The momo crowd is 🔒 oil in the early trade. Smart money is 🔒.
For longer term, please see oil ratings.
Our very, very short-term early stock market indicator is🔒. This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.
Interest rates are ticking up and bonds are ticking down.
The dollar is weaker.
Trading futures is not recommended for most investors. The purpose of providing this information is to give an indication of the premarket activity that usually guides the activity when the market opens.
Gold futures are at $1903, silver futures are at $24.68, and oil futures are $40.58.
S&P 500 futures resistance levels are 3460, 3520 and 3600: support levels are 3420, 3390 and 3320.
DJIA futures are up 114 points.
Protection Bands and What To Do Now?
It is important for investors to look ahead and not in the rear view mirror.
Consider continuing to hold existing positions. Based on individual risk preference, consider holding 🔒in cash or treasury bills or short term bond funds or allocated to short term tactical trades and short to medium-term hedges of 🔒 and short term hedges of 🔒. This is a good way to protect yourself and participate in the upside at the same time.
You can determine your protection bands by adding cash to hedges. The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive. If you do not hedge, total cash level should be more than stated above but significantly less than cash plus hedges.
It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash. When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks. High beta stocks are the ones that move more than the market.
This post was just published on ZYX Buy Change Alert.
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