{"id":109287,"date":"2021-11-01T03:40:47","date_gmt":"2021-11-01T07:40:47","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=109287"},"modified":"2024-09-11T14:24:34","modified_gmt":"2024-09-11T18:24:34","slug":"chart-advisor-breakout-week","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-breakout-week\/","title":{"rendered":"Chart Advisor: Breakout Week"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\" id=\"h-friday-29th-october-2021\">Friday, 29th October, 2021<\/h2>\n\n\n\n<p><strong>1\/Large-cap stocks rebound and hit new highs&nbsp;<\/strong><\/p>\n\n\n\n<p><strong>2\/ Apple investors take profits after earnings miss&nbsp;<\/strong><\/p>\n\n\n\n<p><strong>3<\/strong>\/ <strong>Amazon disappoints, but traders optimistic&nbsp;<\/strong><\/p>\n\n\n\n<p><strong>4\/ The bottom line<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-1-large-cap-stocks-rebound-and-hit-new-highs-nbsp\">1\/ <strong>Large-Cap Stocks Rebound and Hit New Highs&nbsp;<\/strong><\/h2>\n\n\n\n<p>Major averages overcame early losses to claim new highs as buying accelerated into the close. After setting a record high, State Street\u2019s S&amp;P 500 Index ETF (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=spy&amp;utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">SPY<\/a>)&nbsp;posted&nbsp;a 0.2% gain. Invesco\u2019s Nasdaq 100 ETF (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=qqq&amp;utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">QQQ<\/a>)&nbsp;hit&nbsp;a high as well, finishing with a 0.5% gain. State Street\u2019s Dow Jones Industrial Average ETF (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=dia&amp;utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">DIA<\/a>)&nbsp;fell&nbsp;just short of claiming a new high, finishing the session with a 0.2% increase, while the iShares Russell 2000 ETF (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=iwm\">IWM<\/a>)&nbsp;remained&nbsp;flat.&nbsp;&nbsp;<\/p>\n\n\n\n<p><a href=\"https:\/\/www.investopedia.com\/terms\/p\/pce.asp?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">Personal Consumption Expenditures (PCE)<\/a> numbers were in line with economists\u2019 expectations, showing that inflation for goods and services consumed by individuals increased 0.2% for the month of September. PCE is a key inflation measure watched by the Federal Reserve, and it gives important insights into consumer spending behavior. Annual inflation rose at its fastest pace in more than 30 years during September despite a decline in personal income.&nbsp;&nbsp;<\/p>\n\n\n\n<p>The chart below compares the recent performance of SPY with the U.S. Dollar Index (<a href=\"https:\/\/www.tradingview.com\/symbols\/TVC-DXY\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">DXY<\/a>)&nbsp;and&nbsp;State Street\u2019s Gold Trust (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=gld&amp;utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">GLD<\/a>). Although not official, DXY and GLD tend to have an inverse relationship, as when the value of the dollar increases, the price of gold tends to fall. During times of high inflation, the value of the dollar decreases, which could explain why GLD could be seen as a hedge against inflation.&nbsp;&nbsp;<\/p>\n\n\n\n<p>Even with inflation numbers coming in relatively high compared to recent history, DXY remains ahead of GLD as SPY continues an upward trend. This could mean that investors, emboldened by relatively good third-quarter earnings, are not concerned with long-term lingering inflation, and are confident to continue placing money in equities like stocks over assets such as gold. This could be viewed as a bullish view of the overall strength of the economy.&nbsp;&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1646\" height=\"854\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1-1100x571.jpg\" alt=\"\" class=\"wp-image-109289 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1-1100x571.jpg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1-700x363.jpg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1-300x156.jpg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1-768x398.jpg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1-1536x797.jpg 1536w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/1.jpg 1646w\" data-sizes=\"(max-width: 1646px) 100vw, 1646px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1646px; aspect-ratio: 1646\/854;\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-2-apple-investors-take-profits-after-earnings-miss-nbsp\">2\/ <strong>Apple Investors Take Profits After Earnings Miss&nbsp;<\/strong><\/h2>\n\n\n\n<p>Investors took profits for Apple (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=aapl&amp;utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">AAPL<\/a>), selling off the stock after the company missed revenue expectations for its fiscal fourth-quarter earnings&nbsp;<a href=\"https:\/\/www.investopedia.com\/apple-q4-fy2021-earnings-report-recap-5207676?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">announcement<\/a>. Analysts expected the tech giant to report $1.21 in&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/e\/eps.asp?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">earnings per share (EPS)<\/a>&nbsp;and $84.2 billion in revenue. AAPL announced&nbsp;$1.24 in EPS and $83.4 billion in revenue, citing larger-than-expected supply chain constraints on iPhones, iPads, and Macs.&nbsp;<\/p>\n\n\n\n<p>As a result of disappointing revenue numbers, AAPL stock fell 1.8%. The stock is still trading in an above average range, over its 20-day moving average, as per the chart below. Prior to earnings, option traders were positioned for the stock to move higher, as there were 4.6 million call options in the open interest for AAPL, compared to nearly 3.8 million puts.&nbsp;&nbsp;<\/p>\n\n\n\n<p>After earnings, option traders appear to be placing bets that the earnings-based share price decline will reverse in the future. That\u2019s because trading volumes on Friday featured 1.5 million calls compared to 624,000 puts. It should be noted that, after accounting for intrinsic value, options remain priced for the stock to move lower in the near term.&nbsp;&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"608\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1100x608.jpg\" alt=\"\" class=\"wp-image-109290 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1100x608.jpg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-700x387.jpg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-300x166.jpg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-768x424.jpg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1536x849.jpg 1536w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2.jpg 1562w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/608;\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-3-amazon-disappoints-but-traders-optimistic-nbsp-nbsp\">3\/ <strong>Amazon Disappoints, but Traders Optimistic&nbsp;&nbsp;<\/strong><\/h2>\n\n\n\n<p>Shares of Amazon (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=amzn&amp;utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">AMZN<\/a>) fell 2% after the company badly missed EPS expectations for its fiscal third-quarter earnings&nbsp;<a href=\"https:\/\/www.investopedia.com\/amazon-q3-fy2021-earnings-report-recap-5207556?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=25519447&amp;utm_medium=email\">report<\/a>. AMZN announced&nbsp;$6.12 in EPS and $110.8 billion in revenue, well below analyst forecasts of $9.31 in EPS and $111.8 billion in revenue. The company is dealing with decelerating sales growth while facing supply chain issues, labor shortages, and increased shipping costs. As the COVID-19 pandemic eases, more consumers appear to be favoring physical stores.&nbsp;<\/p>\n\n\n\n<p>Despite the decrease in share price, options continue to be priced for the stock to move higher. Option traders appear to be snapping up this pricing, as Friday trading volumes favored calls over puts nearly 2-to-1. This could mean that while the share price has fallen, option traders still see upside in AMZN stock going forward, or option traders think the decline will continue and are utilizing this opportunity to profit from selling call options.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" width=\"1100\" height=\"608\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1-1100x608-1.jpg\" alt=\"\" class=\"wp-image-211796 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1-1100x608-1.jpg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1-1100x608-1-700x387.jpg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1-1100x608-1-300x166.jpg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2021\/11\/2-1-1100x608-1-768x424.jpg 768w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/608;\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-4-the-bottom-line-nbsp\">4\/ <strong>The Bottom Line&nbsp;<\/strong><\/h2>\n\n\n\n<p>Stock indexes broke out to new highs this week despite mixed results from big tech companies such as Apple and Amazon. Surprisingly, the dollar hasn\u2019t started a downtrend on inflation signals, keeping the price of gold trending lower.&nbsp;<\/p>\n\n\n\n<p>  &#8212;  <\/p>\n\n\n\n<p>  Originally posted on 29th October, 2021 <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Major averages overcame early losses to claim new highs as buying accelerated into the close. After setting a record high, State Street\u2019s S&#038;P 500 Index ETF (SPY)\u00a0posted\u00a0a 0.2% gain.<\/p>\n","protected":false},"author":364,"featured_media":109289,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[14,18,6,19,8,9,22,26,3],"tags":[155,149,3057,1779,2087,208,2782,262],"contributors-categories":[13686],"class_list":{"0":"post-109287","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-etfs","8":"category-macro","9":"category-north-america","10":"category-options","11":"category-region","12":"category-securities","13":"category-stocks","14":"category-text-articles","15":"category-traders-insight","16":"tag-aapl","17":"tag-amzn","18":"tag-dia","19":"tag-dxy","20":"tag-gld","21":"tag-iwm","22":"tag-qqq","23":"tag-spy","24":"contributors-categories-investopedia"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Chart Advisor: Breakout Week | Traders&#039; Insight<\/title>\n<meta name=\"description\" content=\"Major averages overcame early losses to claim new highs as buying accelerated into the close. 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