The Shakedown 1/18/21

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LAST WEEK, S&P 500 (-1.46%)

Monday: -0.67%

Tuesday: +0.02%

Wednesday: +0.27%

Thursday: -0.35%

Friday: -0.73%

We got a slight pullback in stocks to end the week Thursday/Friday. We're seeing a ton of rotation to begin the year. The small caps are on an unrelenting tear, the value names of the S&P are keeping the major indices moving higher, and the FAANG stocks have been incredibly weak, all things considers. Many S&P sectors have turned around and have been leading the market the past few weeks; energy, financials, healthcare & industrials. The recent IPO names continue to go crazy as the market continues moving higher which I expect to be the case until we get that inevitable sell off.


I am closely watching the QQQ last week as it seems to be giving up its leadership as its largest components appear to be out of gas judging by this past week's action. The Nasdaq was actually leading the market lower into the close Friday. Seemingly every time this has happened over the past few years, we immediately see that rotation back into tech stocks. Is it different this time? Or do we see those names come with early strength this week? 


We're seeing lots of rotation among leadership to begin the year. The small caps are up a casual 40% since the vaccine was announced in November.


We got the real kickoff to Earnings Season coming up this week with Netflix after the close Tuesday and the real fun begins! This is sure to be an interesting earnings season taking Covid into consideration. We'll see either how well companies recovered from the Pandemic or how the latest round of lockdowns crushed Q4 earnings.


Earnings This Week

Click the above picture for a full list of the companies reporting this week


First big week of earnings this week! Netflix Tuesday after the close is when the fireworks generally begin. 





Horizon Therapeutics, HZNP, is a pharmaceutical company that focuses on developing medicines that address unmet needs for rare diseases. On January 11th they released their full year 2020 financial results to which they had record sales and exceeded the high end of the comany's guidance range. Their year over year growth was greater than 65% on the back of their Thyroid Eye Disease and Uncontrolled Gout treatments (I told you they took on rare diseases).

They released these results to the JP Morgan Healthcare Conference on January 12th when the stock rose to resistance too quickly and had a false breakout. Since, all it has done is given us healthy sideways action in front of the 80/81 resistance level, which we love.

I'm watching the 79.50/80 area for potential first entry, depending on how it sets up, knowing the macro trigger of the trade is the high of that false breakout at 81. 

Trigger: $80/81

Stop: $76.49

Target: $90-100+

Click Below for this week's Watchlist

Hope to see you in the chat Tuesday!

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