The purpose of this article is to provide some insight into potential upcoming trades and portfolio management across several markets.
Cryptos struggle to break out either direction. We could see a shorter term consolidation which makes this an elevated risk area. As we mentioned in the Premium article, we do not mind adding here, but we want to use risk management and keep some cash on the side.
The most important aspect of trading and or investing is having some cash on hand. We are using only 25% of our capital here. Market moves up, we have some exposure, market moves down, we have cash to take advantage of the opportunity. The focus should always be about managing risk not making money. Managing risk well, will result in making money in the long term.
Earnings season is starting to heat up, but though it has been good so far, the market has not really reacted. The key here is not whether they beat, but how they guide and margin compression. As manufacturer’s start to report, we will get better insight into how margins are getting compressed. One sector to watch is Semi-Conductors.
We already are seeing this as JNJ reported marginal revenue increase YoY, and earnings were only slightly up. JB Hunt also missed on earnings and revenue. IBM missed on both the top and bottom.
On the positive side JP Morgan had a great earnings beat, and with a rise in commercial loans, and merchant services, the economy is still quite strong. Its is really going to be about margins being compressed which may result in an earnings recession.
Qualcomm & Apple:
As we mentioned in our weekly and on the radio show Monday, Apple needed to make a deal or risk being left behind. Though the street had Apple with the upper hand, it was really Qualcomm that did. Ironically shortly after the deal Intel announces they are out of the 5G market.
Qualcomm is surely a stock I want in my portfolio and though I have traded it over the past year, I am now looking to add to my portfolio. Do not rush to buy the open today. Even if Qualcomm moves higher, this is a horrible habit to get into. That feeling of “I’m missing out” can quickly turn into “I can’t believe I bought the FOMO”.
IPO’s on the Rise:
With a flurry of IPO’s coming into the market, there are a couple that we are actually interested in. One that comes out this week I actually like is Pintrest.
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