Facebook Inc. (FB) has sliced and diced shareholders since September, dropping more than 15% from an all-time high before bouncing strongly at a 19-month trendline on Oct. 12. It jumped more than 20 points off the low into Wednesday of last week and then plummeted after Snap Inc. (SNAP) warned about the revenue impact of new iPhone ad tracking blockers. The stock is back to trendline support, just in time for Monday’s post-market earnings report.
General Motors Corp. (GM) profits have been hurt by persistent supply disruptions so far in 2021, with the automaker forced to idle factories despite the enthusiastic reception of new models and a major commitment to electric vehicles. The stock bounced at an 8-month low in August and closed half the distance back to June’s all-time high in the 60s, before the rally stalled about two-weeks ago. All eyes are now focused squarely on Wednesday’s post-market report and further comments about supply issues.
Dow component Chevron Corp. (CVX) was left for dead in 2020, with the election of an environmentally friendly president heralding in an era of alternative energy. The crude oil futures market promptly took off for the heavens, reacting to political pressure on drilling and production that could trigger worldwide shortages until clean energy can replace fossil fuels, which might take a decade or more. Integrated oil and gas companies reacted slowly to the rally but are now getting bought aggressively and could hit new highs in 2022.
Bitcoin bottomed out at 40,000 in September after dropping nearly 25% and turned sharply higher, heading in a straight line into the April high near 65,000. The digital giant broke out for a single session last week before turning tail in a decline that’s typical when financial instruments test prior highs. The reversal left behind a weekly shooting star candlestick that predicts at least several weeks of relative weakness before the cryptocurrency can successfully break out to new highs.
The Russell-2000 ETF (IWM) more than doubled in price into March 2021 before topping out above 233. Price action since that time has carved a narrow symmetrical triangle that, when taken together with the vertical uptick, has completed a bullish ‘flag at the top of a flagpole’ that predicts a measured move equal to the prior rally. Small caps have just entered their most seasonally favorable time of year, raising odds for a breakout that could last through the first quarter of 2022.
For a look at this week’s economic events, check out our economic calendar.
Disclosure: the author held no positions in aforementioned securities at the time of publication.