THE MOMO CROWD BUYS THE VIRUS ‘BREAKTHROUGH’ LOCK, STOCK AND BARREL $MRNA $NVAX $BNTX $KMDA $CERS $ADMA $GRFS $TAK $SRNE $DJIA $SPX $NDX $QQQ $SPY

THE MOMO CROWD BUYS THE VIRUS ‘BREAKTHROUGH’ LOCK, STOCK AND BARREL $MRNA $NVAX $BNTX $KMDA $CERS $ADMA $GRFS $TAK $SRNE $DJIA $SPX $NDX $QQQ $SPY

This post was published yesterday in The Arora Report  paid feeds as Afternoon Capsule.

To gain an edge, this is what you need to know now.

Lock, Stock And Barrel 

In the Morning Capsule we shared with you why the touted ‘breakthrough’ is not a breakthrough at all.  The day has passed and still no reliable data on the 35% recovery rate.  Don’t tell any of this to the momo crowd, they have bought into the breakthrough lock, stock and barrel.

Selling Vaccine And Testing Stocks

We shared with you in the morning that even the touted claim of the breakthrough applies only to the patients who are hospitalized.  Note the following interesting momo crowd behavior today.

  • The momo crowd is aggressively selling coronavirus vaccine stocks.
  • The momo crowd is aggressively selling coronavirus testing stocks.
  • After initially aggressively buying plasma (the touted breakthrough) stocks, the momo crowd is aggressively selling plasma stocks as of this writing.

Reinfection

The first confirmed case of reinfection has now been documented.  A Hong Kong man who was first infected in March appears to have contracted the virus again while traveling in Europe.  The sequencing of the virus from the two infections shows that they did not match — there was a difference of 24 nucleotides.

So far there is only one documented case but this development needs to be carefully watched.  The concern is that the immunity from the virus might be short lived. As usual, the momo crowd is totally oblivious to this new development.

Money Flows

The momo crowd money flows since the Morning Capsule are very positive.

Smart money flows since the Morning Capsule are neutral.

Short squeeze money flows are positive.

A Special Note To New Subscribers

Note the smart money behavior.  Smart money tends to sell into strength on strong up days.

New subscribers should consider adopting smart money’s  way of investing and trading.

Sentiment

Sentiment is very positive bordering on extreme.

Sentiment is a contrary indicator at extremes.  In plain English, this means that when sentiment becomes extremely positive it is time to sell and when sentiment becomes extremely negative it is time to buy.

Gold

The momo crowd money flows in gold are negative since the Morning Capsule. The thinking is that with the ‘breakthrough’ treatment, who needs the safety of gold?

Smart money flows are  neutral in gold  since the Morning Capsule.

Oil

The momo crowd money flows in oil are positive since the Morning Capsule.

Smart money flows in oil are neutral  since the Morning Capsule.

Buy Zones And Buy Now Ratings

Those who meet the protection band criteria as outlined in the Morning Capsule and are underinvested may consider continuing to lightly scale in based on buy zones and ‘Buy Now’ ratings of individual securities.

Any buying should be strategic and not tactical unless there are specific recent signals given.

It is a mistake to buy all in at one time.  Please see Trade Management Guidelines.

Nibbling

Consider not nibbling at this time if you are under invested and there is significant room in your protection band criteria.

Nibbling refers to buying very small quantities, often in existing long term positions with the intention of exiting these additions in the short term. It is similar to trade around positions but without specific signals.

Close

There appear to be buy on close orders

There is merit to watching the pattern of market on close orders as they represent the day’s dominant net cumulative activity  by many professionals and funds.

The Afternoon Capsule is not  published daily but only when conditions warrant it.  The content below is unchanged and is to be used for reference as needed. 

Sophistication 

Many investors are spoiled due to the decade long bull market.  Many believe it is very simple – be all in or be all out.  Unfortunately, the last decade was an exception to the rule.

As the market is running up, investors who do not understand the true nature of the market are jumping in with both feet without appreciating the risks.

Risk and reward are two sides to the coin. It is important to consider both.

For your reference, we are pasting the following from your Getting A Running Start Guide,

Everything should be made as simple as possible but not simpler.

Albert Einstein

Strategic Vs. Tactical

All investors should consider bringing more sophistication to their investing and trading.  It is important to clearly understand the difference between strategic and tactical calls.  For your convenience, a prior post is pasted below.

ASK ARORA: CASH AND HEDGES: UNDERSTANDING THE DIFFERENCE BETWEEN STRATEGIC AND TACTICAL CALLS

Nigam Arora answers your questions about investing in stocks, ETFs, bonds, gold and silver, oil and currencies. Have a question? Send it to Nigam Arora.

We have written previously about the importance of understanding the difference between strategic calls and tactical calls.

We welcome your comments and questions.  The law does not allow us to answer them individually. However, when a large number of subscribers ask similar questions, a post is done.  Typically starting with Ask Arora.

Based on the questions received this morning, a refresher on understanding the difference between strategy and tactics is in order.

Strategy

Strategy defines medium to long term plan to achieve the highest risk adjusted returns.

Tactics

Tactics are small adjustments within the strategy to further enhance risk adjusted returns.

If You Could Pick Only One

We recognize that all investors have individual preferences.  If you could pick only one, consider focusing on the strategy. Never focus only on tactics at the expense of strategy. 

Strategic Call

The strategic call at this time is to stay cautiously bullish.  The logic is very straightforward.  Consider the following key points:

  • The stock market has been going straight up for 10 years.  It is late cycle.  Portfolios have to be organized for the late cycle.  Risks are much higher in the late cycle compared to when a bull market is in an early stage.
  • The world is awash in debt.  The sovereign debt owed by governments and corporate debt owed by zombie corporations has dramatically increased.  It is a bubble that is getting bigger waiting for a pin to prick it.
  • Valuations are expensive.
  • A big reason for levitation of the stock market is money printing by the central banks.   This can continue for a long time but not forever.

Tactical Calls

Tactical calls are simply short term adjustments.  For example, a tactical call to decrease cash and hedges is based on the following:

  • Weak hands temporarily washed out overbought condition.
  • Overbought condition temporarily relieved.
  • Sentiment backing off from almost extreme bullish levels.
  • Overall better earnings.

Cash And Hedges

We provide a range for cash and hedges.  Most investors would be in the middle of the ranges.  As such, they would not need to make any change.  When a change is given only at the edges of the ranges, only the most active investors need to make a change.

Arora’s 12th Law

Arora’s 12th Law is applicable here: To be successful at investing and trading, flow with the new data and stay nimble.

Bullet Proof Your Portfolio And Increase Your Returns

We consistently see that private investors, money managers and investment advisors who have attended the Bullet Proof Your Portfolio and Increase Your Returns seminar do significantly better compared to those who have not attended the seminar.

Here are the four main reasons why this consistently happens to investors who attend the seminar:

  • They start understanding the true nature of the markets.
  • Develop a better framework to handle the true nature of the market.
  • Tend to act with more conviction and with more comfort.
  • Tend to develop a better control over their emotions.

A knowledgeable investor would have turned $100,000 into over $1,000,000 with the help from The Arora Report. NOW YOU TOO CAN ALSO SPECTACULARLY SUCCEED AT MEETING YOUR GOALS WITH THE HELP OF THE ARORA REPORT. You are receiving less than 2% of the content from our paid services. …TO RECEIVE REMAINING 98% INCLUDING MANY ATTRACTIVE INVESTMENT OPPORTUNITIES, TAKE A FREE TRIAL TO PAID SERVICES.

Please click here to take advantage of a FREE  30 day trial.

Check out our enviable performance in both bull and bear markets.

FREE: SUBSCRIBE TO ‘GENERATE WEALTH’ NEWSLETTER

Related Posts

WEEKLY STOCK MARKET DIGEST: THE CHART SHOWS THE IMPORTANCE OF FOLLOWING STOCK MARKET TECHNICALS RIGHT NOW

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights ...

BUYING ON EXCITEMENT ABOUT BIDEN UNDOING TRUMP LEGACY — TWIN CAUTIONS

  Twin Cautions Please click here for a chart of   Gevo (GEVO). Note the following: Prudent investors should observe two cautions. The momo ...

ACT NOW: THE LAST DAY OF THE NEW YEAR SALE — CAPTURE IMMENSE GAINS SUCH AS 2865%

Act Now: The Last Day Of The Sale Thank you for your great response to the New Year sale.  If you ...

DEADLINE TOMORROW: CAPTURE IMMENSE GAINS SUCH AS 2865% — NEW YEAR SALE — DOUBLE BONUS: ACT NOW TO GET FREE TRIALS

Deadline Tomorrow Thank you for your great response to the New Year sale.  If you have not yet taken advantage of ...

WEEKLY STOCK MARKET DIGEST: PRUDENT INVESTORS PAY ATTENTION TO THIS CHART — EXCITEMENT ABOUT BIDEN’S TRILLIONS

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights ...

DEADLINE NEAR: CAPTURE IMMENSE GAINS SUCH AS 2865% — NEW YEAR SALE — DOUBLE BONUS: ACT NOW TO GET FREE TRIALS

Deadline Thank you for your great response to the New Year sale.  If you have not yet taken advantage of the ...

U. K. REGULATOR WARNING — ‘LOSE ALL THEIR MONEY’ DAMPENS MOMO SENTIMENT

'Lose All Their Money' Please click here for a  chart of Bitcoin futures (BRR_F). Note the following: We were sharing with you late ...

NEW BUY ZONES ON 44 STOCKS — SEMICONDUCTORS, ELECTRIC CARS, 5G, SOLAR, SPORTS BETTING AND MORE

Buy zones are very powerful. When a stock dips into the buy zone you buy it.  If you were following ...

WEEKLY STOCK MARKET DIGEST: SMART MONEY SELLS MOMO STOCKS AND BUYS BANKS, SMALL CAPS AND MARIJUANA STOCKS

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights ...

CAPTURE IMMENSE GAINS SUCH AS 2865% — NEW YEAR SALE — DOUBLE BONUS: ACT NOW TO GET FREE TRIALS

Gains Such As 2865% It is well known among serious investors that long term positions in The Arora Report portfolios have ...

RAISE CASH AND HEDGES, A NEW YEAR RARITY, GEORGIA ELECTION — WATCH MARIJUANA STOCKS

To gain an edge, this is what you need to know today. Raise Cash And Hedges Investors should always give priority to ...

GEORGIA ELECTION — GOLD INDICATION — MOMO DEPARTS FROM CONVENTIONAL WISDOM

To gain an edge, this is what you need to know today. Georgia Election Please click here for a chart of gold ETF ...

CAPTURE IMMENSE GAINS SUCH AS 2865% — NEW YEAR SALE — DOUBLE BONUS: ACT NOW TO GET FREE TRIALS

Gains Such As 2865% It is well known among serious investors that long term positions in The Arora Report portfolios have ...

BEATING THE MARKET WITHOUT A TRADING FRENZY

  To gain an edge, this is what you need to know today. Beating The Market Please click here for a chart of S&P 500 ETF ...

WEEKLY STOCK MARKET DIGEST: PROTECT YOURSELF, POLITICIANS TURNING KING DOLLAR INTO POOR DOLLAR

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights ...

CONSIDER BEING EXTRA CAREFUL IN THE STOCK MARKET AT THIS TIME

To gain an edge, this is what you need to know now. Momo Left Without Constraints Please click here for a chart ...

A NEW IDEA ON BIOTECH MARAVAI — SUPPLIES A KEY COMPONENT OF CORONAVIRUS VACCINE

Maravai LifeSciences (MRVI) supplies a key component of the coronavirus vaccine produced by Pfizer (PFE) and BioNTech (BNTX). The vaccine ...

CONSUMER SENTIMENT TURNS VERY POSITIVE IN THE FACE OF RISING CORONAVIRUS DEATHS

To gain an edge, this is what you need to know now. Consumer Sentiment Turns Positive Please click here for a chart of Nasdaq 100 ETF ...

WEEKLY STOCK MARKET DIGEST: AN IMPORTANT CHART THAT ALL INVESTORS SHOULD WATCH BUT ARE NOT WATCHING

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights ...

COUNTER INTUITIVE: STOCK MARKET LOVES THAT NEW HIRING HAS SLOWED

To gain an edge, this is what you need to know today. Counter Intuitive Please click here for a chart of Dow ...

Follow

Get every new post delivered to your Inbox

Join other followers