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Market Direction Model - Model switches to BUY on July 28, 2021

MDM has switched to a BUY signal. 

Tech leaders such as FB and GOOGL have been trending higher despite the majority of the market which has been dragging. AAPL and AMZN both broke out of bases on their weekly charts recently and look to move higher. 

GOOGL's earnings came in strong so it is looking to gap higher at the open. Its revenues came in at over $61 B vs. estimates of $56.23. Earnings came in at 27.26 vs estimates of 19.325.



Meanwhile, TSLA's earnings report was nicely ahead of expectations. Its car margin sits at 28% vs. most companies such as Comcast which sits at 12%. Revenue growth was 98%, EBITDA growth 106%. They're sold out of powerwalls until the end of next year due to pent up demand. The PEG ratio (price-to-earnings to growth) is 0.9633. No disruptive tech stocks have such a low PEG ratio. Its P/E is 100 based on today's earnings, not 1200 as mistakenly reported by some sources. It has been getting support at its 40-week MA.



For longer term holders using weekly charts and 10-week and 40-week moving averages, all of the above names can be held for the longer term but dont buy extended unless you're willing to deal with drawdowns that may exceed your risk tolerance levels.

While the major averages continue to push on a string, this is nothing new in this Era of QE. Things can push higher for longer than expected.


Suggested ETFs (Note: Many members buy the standard ETFs or their preferred ETFs. This list serves as a guide as to which ETFs we think may outperform, but the key point is to be on the right side of the market regardless of which ETF or ETFs one chooses.)

"Stuff" stocks, ie, commodity-related plays should continue to do well, thus the S&P500 and its related ETFs should continue to show strength. That said, techcentric NASDAQ Composite and TECL often lead with outperformance on a percentage basis under more normal conditions.

1-times

SPY (S&P 500)

QQQ (NASDAQ-100)

2-times

SSO (S&P 500)

QLD (NASDAQ-100)

3-times

UPRO (S&P 500)

TQQQ (NASDAQ-100)

TECL (Direxion Trust Technology)


NOTE: This is a suggested list. Investors may wish to become acquainted with the full range of available ETFs, and should make an effort to understand how these ETFs are created and what their components are, as well as being aware of the downside risks involved, especially with leveraged ETFs. Certain ETFs may be more appropriate depending on one's risk tolerance levels. Typing in keyword 'ETF' into the FAQ keyword search bar or going here https://www.virtueofselfishinvesting.com/faqs/search?p=1&q=etf  and visiting this site https://etfdb.com/  can be instructive.

This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2021 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.
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