Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights from the prior week gives them an edge over the coming weeks. Here is the day by day rundown from the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers of The Arora Report.
Please scroll down for the section What To Do Now.
THE LAST DAY, ACT NOW TO SAVE $2,605 — FOR INVESTORS SERIOUS ABOUT MAKING MILLIONS
LOWEST UNEMPLOYMENT RATE SINCE 1969
To gain an edge, this is what you need to know today.
Jobs Report
Unemployment rate fell to 3.7% vs. 3.8% consensus. This is the lowest unemployment rate since 1969.
Nonfarm Private Payrolls came at 121K vs. 180K consensus.
These numbers are mixed and as a result are creating volatility in stocks, bonds and currencies.
Momo Crowd And Smart Money In Stocks
The momo crowd is buying stocks in the early trade. The smart money is lightly selling stocks.
Gold
Just like yesterday, gold is showing remarkable resilience in the face of the economic data that is bearish for gold. Both momo crowd and smart money are inactive.
Oil
Oil pulled back yesterday as the short squeeze eased. This morning the momo crowd is aggressively buying oil but the smart money is lightly selling oil.
Marijuana
Tilray (TLRY) priced convertible notes at terms more favorable than expected. The notes can be converted to stock at a price of about 15% above the closing price.
Molson Coors (TAP) closed the deal with HEXO Corp (HYYDF) (HEXO). These two developments are creating positive sentiment.
Technical Patterns
Small cap stocks are tracing a Megaphone Top. This is bearish. ETF of interest is IWM.
This is powerful information and many investors use this to enter trades in addition to our official signals. Here are the three most common uses: 1) Short-term trades in ETFs 2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators. To learn more please click here.
Markets
Our very, very short-term early stock market indicator is neutral but can quickly swing either way.
Gold futures are at $1207, silver futures are at $14.73, and oil futures are $74.55.
S&P 500 resistance levels are 2918, 2925 and 2950; support levels are 2860, 2840 and 2800.
DJIA futures are up 24 points.
BOND ROUT SPREADS, BIG CHINA HARDWARE HACK
To gain an edge, this is what you need to know today.
Bond Rout Spreads
Yesterday after strong economic reports, interest rates rose causing a rout in Treasury bonds. Overnight the bond rout spread to Asia and then to Europe. This is causing a negative sentiment for stocks. As of this writing, the bond rout has stalled.
Our calls on bonds have been spot on. We have been steering investors away from bonds and there is no doubt now that has been the correct call.
Big China Hardware Hack
There is a report that the Chinese army engineered a microchip that was included in several motherboards assembled by SMCI to provide Chinese with a back door hack to American data centers. We are looking for trading opportunities. In general this is not good for technology stocks.
Momo Crowd And Smart Money In Stocks
The momo crowd is buying stocks in early trade. The smart money is selling stocks.
Gold
Gold is showing remarkable resilience in the face of rising interest rates.
Oil
A short squeeze is in progress in oil.
Marijuana
STZ earnings are positive for the marijuana space.
Technical Patterns
None of note.
This is powerful information and many investors use this to enter trades in addition to our official signals. Here are the three most common uses: 1) Short-term trades in ETFs 2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators. To learn more please click here.
Markets
Our very, very short-term early stock market indicator is negative.
Currencies, interest rates and bonds are range bound.
Gold futures are at $1205, silver futures are at $14.73, and oil futures are $75.77.
S&P 500 resistance levels are 2925 and 2950; support levels are 2918, 2860 and 2840.
DJIA futures are down 82 points.
ADP REPORT GENERATES OPTIMISM, PEPSI WHIPSAW IN MARIJUANA
To gain an edge, this is what you need to know today.
ADP Generates Optimism
ADP is the largest private payroll processor in the country. It uses its data to give a glimpse of the employment picture before the official report from the Department of Labor. The official report will be released on Friday at 8:30 am, this report is known as the mother of all numbers and all investors should pay careful attention to it.
ADP report was released this morning. Employment change came at 230K vs. 184K consensus. This is generating a lot of optimism.
Momo Crowd And Smart Money In Stocks
The momo crowd is aggressively buying stocks in the early trade. The smart money is lightly selling into the strength.
Gold
The momo crowd is buying gold. The smart money is inactive. The strong ADP report may get in the way of the rally that was beginning to build in gold.
Oil
The momo crowd continues to buy oil. The smart money is lightly selling into the strength in oil.
Pepsi Whipsaw Marijuana
Yesterday Pepsi (PEP) reported earnings. Marijuana stocks ran in advance on speculation that Pepsi will invest in marijuana drinks. When PEP CFO said that PEP is looking at all options including marijuana, the momo crowd aggressively bought marijuana stocks and ran them up. The momo crowd is not know for deep analysis. The smart money noticed that the PEP CFO also said that PEP had no current plans to invest in marijuana. The smart money took advantage of the momo crowd and aggressively sold marijuana stocks into the strength. By late afternoon buying from the momo crowd could not overcome selling by smart money and the rallying fizzled.
Technical Patterns
None of note.
This is powerful information and many investors use this to enter trades in addition to our official signals. Here are the three most common uses: 1) Short-term trades in ETFs 2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators. To learn more please click here.
Markets
Our very, very short-term early stock market indicator is neutral but expect the market to open higher.
Interest rates are ticking up and bonds are ticking down.
The dollar is ticking up.
Gold futures are at $1206, silver futures are at $14.75, and oil futures are $75.21.
S&P 500 resistance level is 2950; support levels are 2925, 2918 and 2860.
DJIA futures are up 98 points.
SENTIMENT DAMPENS ON ITALY SHOWING RESOLVE, RUSSIAN OIL PRODUCTION HITS POST-SOVIET HIGH
To gain an edge, this is what you need to know today.
Italy
The Italian government is showing strong resolve to implement its 2.4% budget deficit target. As we have previously written, this is higher than acceptable to other members of the European Union. This is dampening sentiment on stocks in Europe. The negative sentiment is being carried to the U. S. in early trade.
Momo Crowd And Smart Money In Stocks
The momo (momentum) crowd is buying stocks in early trade. The smart money is lightly selling in the early trade.
Gold
Trading in gold is listless. Light buying is coming in as interest rates start ticking down.
Oil
Russian oil production hit post-Soviet era high. However the momo crowd continues to aggressively buy oil pushing it higher.
Marijuana
Marijuana stocks are mixed in early trade. The momo crowd continues to buy marijuana stocks. The smart money is selling marijuana stocks into the strength.
The buying that came into marijuana stocks yesterday was the result of moms and pops deciding over the weekend that they were going to buy marijuana stocks and placing their buy orders on Monday. Such buying is not likely to continue today.
Technical Patterns
Biotech stocks have traced an Outside Bar. This is bearish. ETF of interest is IBB.
This is powerful information and many investors use this to enter trades in addition to our official signals. Here are the three most common uses: 1) Short-term trades in ETFs 2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators. To learn more please click here.
Markets
Our very, very short-term early stock market indicator is negative but can easily swing positive.
Interest rates are ticking down and bonds are ticking up.
Currencies are range bound.
Gold futures are at $1197, silver futures are at $14.60, and oil futures are $75.37.
S&P 500 resistance levels are 2925 and 2950; support levels are 2918, 2860 and 2840.
DJIA futures are down 64 points.
TRUMP SUCCEEDS AT NEW FAFTA, NEW QUARTER MONEY POURING INTO STOCKS, OIL MATH, MARIJUANA RUSH
To gain an edge, this is what you need to know today.
New NAFTA
In a major success for Trump, U. S. and Canadian negotiators have agreed to a new NAFTA. A deal has already been reached in Mexico. This is creating positive sentiment.
New Quarter Money
Today is the first day of the new quarter. Traditionally new money pours into stocks in the first couple of days of a new quarter. The money flows are especially strong during the fourth quarter.
Momo Crowd And Smart Money In Stocks
The momo crowd is aggressive buyers of stocks. The smart money is lightly selling into the strength.
Gold
The momo crowd is selling gold. The smart money is inactive.
Oil Math
The media is screaming with headlines of Brent crude about to move to $100. In our experience going back over three decades, when the media reaches such a frenzy, it is often a contrary signal.
Sanctions on Iran will take 500K to 2M barrels of oil out of the market. In our analysis at The Arora Report, OPEC and Russia will end up producing additional 500K to 1.5M barrels. These numbers indicate that Brent crude is not likely to go to $100 unless there is a new geopolitical development.
Marijuana
The momo crowd is aggressively buying marijuana stocks in the early trade. Trading patterns show that the money is coming from mom and pop and not from sophisticated investors.
Technical Patterns
Small cap stock have traced an Engulfing Line. This is bullish. ETF of interest is IWM.
This is powerful information and many investors use this to enter trades in addition to our official signals. Here are the three most common uses: 1) Short-term trades in ETFs 2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators. To learn more please click here.
Markets
Our very, very short-term early stock market indicator is positive.
Interest rates are ticking up and bonds are ticking down.
Gold futures are at $1195, silver futures are at $14.59, and oil futures are $73.44.
S&P 500 resistance level is 2950; support levels are 2925, 2918 and 2860.
DJIA futures are up 163 points.
WHAT TO DO NOW
Looking ahead and not only in the rear view mirror, consider continuing to hold existing core portfolio positions. Based on individual risk preference, consider holding cash or treasury bills 21% – 31% and short to medium-term hedges of 10% – 15% and very short term hedges of 10% – 15%.
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