President: This is our first issue of the MARKET BLOG! Take a look at the Indices section below, certain stocks that our members are interested, our Secretary’s opinion, and the President’s comments. Please email any errors, especially numerical, to the President and Secretary. Enjoy!
Our secretary brings you the following information:
Indices: This week was an amazing week for the bulls! Stocks were up all across the board as the Dow was up almost 600 points. It finished the week at 17,390.52. The S&P 500 was up 56 points to 2,018.05. The NASDAQ composite ended at 4,630.74 after a 100 point surge on Thursday.
For our members: Amazon bounced back after a 10% dip last week to end at 305.46! Facebook dropped to 74.99 this week. The Cure Direxion Index, which is a leveraged biotech ETF, was incredibly bullish as it leaped from 107 on Monday to finish at 118.78 on Friday. Tesla dropped 14 points to start off the week but it soared from 220.68 to 242.77 on Tuesday. Tesla finished at 241.70, up from 234.50 on Monday. Finally, Alibaba started the week of very strong as it topped 100 before dropping to 97 after-hours on Tuesday. It finished at 98.60 to end the week. Lots of earnings!
CURE skyrocketed this week as the Ebola scare continues to rage through our country by the day. It has been up 33 points since mid-October! It should be noted that this is about the time the public began to worry about Ebola, leading to the price markup. Facebook shares fell this week because they were a “beat and lower” because of higher cost expectations next year. Alibaba started the week bullish as ever, with many believing it to top expectations for its upcoming Q3 report. But, the optimism died down rapidly after hours on Tuesday as the stock fell 3 points within hours. Amazon managed to slowly but surely climb back over 300 after dipping 10% last week. This is mainly due to rebounding confidence and overall optimism surrounding Amazon.
Secretary: I think that Alibaba will fulfill its potential for Q3 and I believe that its shares will jump well over 100 points. I recommend buying Facebook right now as it is lower than what it normally is; I almost guarantee Facebook will jump over $80 per share in the next 10 days. I also recommend buying Apple as it is experiencing its annual “holiday-season” surge, along with Google and Amazon. Finally, the Cure Direxion Index will continue to increase incredibly, until the Ebola hype dies down, so I predict that it will close well over 130 by the end of this coming week
President’s Comments: First, let’s talk in terms of dollars and percentages, as points are usually reserved for indices. I am not sure how your Alibaba earnings play will turn out, but good luck. Might want to play it with options. Also, remember that just because you realize that a stock (Facebook) is undervalued doesn’t mean that others will realize it and the stock may continue to drop. I completely agree with you that this is a great entry opportunity for Facebook, but I would change your time frame from a swing trade (10 trading days) to a long term entry. As for Apple, also recall that such holiday revenue increases are already factored into the share price, as the market looks around six months ahead. Take a look at stockcharts.com and the performance of Apple over the past decade during different months. CURE is a 50/50 shot, as Ebola may or may not be contained. Right now, the markets think that it is not a big deal; just look at the amazing rebound we had. And don’t forget why the market was up a lot this week: Japan began its QE program right as we ended ours.
Secretary: Thanks a lot Michael, and Happy Trading Everyone!!!
-Aabhash Gautam