Bevare The Bear;  Futures Loom like bitcoin recovered $ 20,000

Bevare The Bear; Futures Loom like bitcoin recovered $ 20,000

Futures Dow Jones will open on Sunday night, along with the S&P 500 and Nasdaq futures. The price of bitcoin returned to $ 20,000 on Sunday after falling far below that key level on Saturday.




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The bear market intensified last week, amid growing concerns that the Federal Reserve will be forced to plunge the economy into recession to curb inflation.

With major indexes falling to their highs before Covid, investors should be on the sidelines. Don’t get excited about one-day jumps, as technology-driven progress on Friday. Instead, prepare to take advantage of the next sustainable growth trend.

There aren’t many actions to stick to, but here are five that do a reasonable job: Tesla (TSLA) rival BID (BIDDF), Vertek Pharmaceuticals (VRTKS), fertilizer and lithium play SCM (PPS), Eli Lilli (LLI) i Enphase Energy (ENPH).

All have lines of relative strength at or near the maximum. The RS line, the blue line on the given charts, tracks the performance of the action against the S&P 500 index.

BID stocks are close to the traditional place of purchase. SKM shares are finding support on their 50-day line after returning big gains. ENPH actions regained that key level on Friday. Vertek and Eli Lilly are not far below their 50-day lines.

LLI shares are on the IBD Leaderboard. Eli Lilli and SKM shares are on IBD 50. BID was the IBD action of the day on Friday.

The video inserted in this article talks about weekly market stocks and analyzes the stocks of BID, SKM and Enphase.

Bitcoin Plunges

Bitcoin broke well below the psychologically crucial level of 20,000 dollars on Saturday. It is $ 17,601.58 on Saturday afternoon, the lowest level in 18 months and below the December 2017 high of $ 18,942.

But the price of bitcoin on Sunday afternoon was above $ 20,000. That is still far below the November 2021 high of $ 68,990.90 and about a third less than June 11.

Other cryptocurrencies fall just as much or more in what is described as “crypto winter”.

Dogecoin, which jumped sharply to 74 cents in early 2021 and fell 5 cents on Saturday, recovered somewhat on Sunday. Tesla CEO Elon Musk wrote on Sunday that he is still buying it.

Investors have fled risky assets generally for fear of inflation and recession, but cryptocurrencies appear to differ in a bearish relationship with speculative growth stocks. After Bitcoin and Nasdaq peaked in November, the cryptocurrency followed the ARK Innovation ETF (ARKK) closely for several months. But the ARKK did not lower its lows in late May, while Bitcoin accelerated its losses. In recent weeks, several crypto lenders have halted the withdrawal, while so-called stable coins have become untied.

Dov Jones Futures today

Dow Jones futures open at 18:00 ET, along with S&P 500 futures and Nasdaq 100 futures.

U.S. markets will be closed on Monday for the June 10 holiday, but other stock exchanges around the world will be open. Dow futures will normally trade on Monday.

Federal Reserve Governor Christopher Waller said on Saturday that he was in favor of another increase in the rate of 75 basis points at the Fed meeting in late July. Markets are currently seeing a high probability of this, but it is not entirely affordable.

Remember that overnight trading in Dow futures and elsewhere does not necessarily turn into real trading at the next regular session of the stock exchange.


Join the IBD experts as they analyze the actions that can be applied at the stock exchange meeting on IBD Live


Stock market

The stock market again had large weekly losses, and the main indices fell to the worst levels in more than a year.

The Dov Jones Industrial Average sank 4.8% in last week’s trading on the stock exchange. The S&P 500 fell 5.8%. Nasdac composite withdrew by 4.8%. Russell 2000 with a small capitalization fell 7.5%.

The yield of the 10-year treasury rose by 8 basis points to 3.24%. On Tuesday, the 10-year yield rose to 3.48%, an 11-year high.

U.S. crude futures fell more than 9 percent to $ 109.56 a barrel last week, breaking a seven-week string of losses. Gasoline futures also fell sharply. Natural gas prices have fallen.


Stock market forecast for the next six months


ETFs

Among the best ETFs, the Innovator IBD 50 ETF (FFTI) fell just over 12% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) fell 9.1%. The IShares Expanded Tech-Software Sector ETF (IGV) was down 5.1%. The VanEck Vectors Semiconductor ETF (SMH) lost 8.1%.

The SPDR S&P Metals & Mining ETF (KSME) sold out 10.4% last week. The Global X US Infrastructure Development ETF (PAVE) fell 8.6%. The US Global Jets ETF (JETS) fell 8.9%. The SPDR S&P Homebuilders ETF (KSHB) fell 11.4%. The Energy Select SPDR ETF (KSLE) fell 17.2% and the Financial Select SPDR ETF (KSLF) 4.8%. The SPDR Health Care Fund (KSLV) fund lost 4.5%, with Lilli and VRTKS shares in both shares.

Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) fell 3.3%, recovered from its lowest values ​​and is still not undermining its late May lows. The ARK Genomics ETF (ARKG) fell just under 1% after setting a new two-year low. Tesla remains the main holding company in Ark Invest ETFs. Ark has a small position in BID shares.


Five best Chinese action to watch


BID Stock

Shares of BID rose 4% on Friday, but fell 4.1% to 37.45 on Sunday, breaking a five-week winning streak. The stock forged a handle on the weekly chart, giving it a 39.81 shopping point. With such a deep base – 48% – the risks of a failed breakthrough are higher. A long handle, especially one long enough to be your own solid foundation, would be constructive.

But with Chinese stocks of electric vehicles – and Chinese stocks on the U.S. stock market in general – recovering, BID stocks may not stay in the park long. Nio (NIO), Xpeng (KSPEV) i Li Auto (LI) were running, and Li Auto was approaching highs. Li Auto will unveil its second hybrid SUV, the L9, on Tuesday.

BID’s internal work with batteries and chips, along with huge capital spending over the past 18 months, has spurred huge sales growth and enabled the company to avoid supply chain problems and blockades in China. Its sales of electric vehicles and plug-in hybrids will surpass Tesla’s EV-only sales in the second quarter and may retain that lead.

Tesla’s shares fell 6.7% to 650.28 last week, almost undermining the lowest values ​​at the end of May.


Tesla Vs. BID: Which EV giant is better to buy?


Enphase Stock

Enphase shares fell 5.8% to 184.90 last week. An 8.9% rise on Friday returned ENPH shares above the 50-day and 200-day lines. The breakout from the double-bottomed base quickly disappeared in early June when the 193 purchase point was no longer valid. But now a lever has been formed, with 217.33 points for shopping just above the June 8 high. Keep in mind that Enphase actions have big daily movements. While solar stocks refused to sell off oil and gas names on Friday, it may not take long.

Shares of ENPH and SolarEdge Technologies (SEDG) continued to be among the most successful S&P 500s on Friday. SEDG shares have regained their 50-day line, working on the basis of a glass with lunch.

Vertek Stock

Vertek shares rose 3.2% to 253.09 last week, almost regaining their 50-day line with a 4.8% rise on Friday. The purchase point of 276.10 cups with lunch is no longer valid, so the official entry is 292.85. But investors could use 279.23 as an early entry.

Eli Lilli Stock

Shares of Eli Lilly fell 2.15 to 390.90 last week, hitting resistance on the 50-day line on Friday. A strong move above the 50-day line could offer early entry for LLI stocks. The previous point of purchase on a flat basis of 314.10 is no longer a value, but Lilli’s shares are in the process of creating another consolidation next to it.

SKM Stock

SKM shares fell 6% to 90.29 last week, but rose on Friday after finding support on their 50-day line. Shares have erased 27% growth from a 90.97 buying point in the last few weeks. But a strong recovery from the 50-day line could offer entry for SKM shares.

SKM and BID shares are key components in the Global X Lithium & Battery Tech ETF (LIT), along with Tesla.

Market analysis

A serious market correction – the bear market for the S&P 500 and Nasdaq – continued to deteriorate last week.

The mixed action on Friday was not inspiring. Yes, the Nasdaq and S&P 500 rose on Friday, so technically the first day of stock market attempts for those two indices. But they only reduced the steep weekly losses.

The S&P 500, Dow Jones and S&P 500 reached their worst levels since the end of 2020.

Even if the market climbs and starts to follow in the near future, there would still be a lot of reason to doubt and little action to buy.

The oil and gas sector, the only permanent area of ​​market power, fell last week, and many big winners gave signals to sell. The sector may not be finished, but it was a change of character, with damaged charts.

While some stocks like BID and SKM are close to the point of purchase, and other names like Vertek, Lilli or Enphase may be interesting with a few solid sessions, many potential leaders may need weeks of repairs. And that is in the scenario where the new market rally takes a firm place.

At the moment, it is much more likely that the stock market will continue to fall. An economy that is shaking in recession while the Federal Reserve is in the early stages of an aggressive tightening cycle is not a great environment for action.

All major indices are close to their peaks before Covid. This could offer a potential level of support, but it does not have to stand. Russell 2000 is already undermining that key level.


Market time with IBD’s ETF marketing strategy


What to do now

Investors have no reason to invest, even energy stocks are flashing signals to sell. The only possible exception would be modest exposure to long-term winners.

However, it is important to stay engaged, observe market action and prepare for the next growth trend.

It’s time to get your pens, not pens, to update your watchlists. Look for actions with strong relative strength, especially if they hold key levels of support. But many stocks with strong RS lines will now have ugly charts.

Read the Big Picture every day to stay in line with market direction and leading stocks and sectors.

Follow Ed Carson on Twitter at @ IBD_ECarson for stock market updates and more.

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