{"id":215225,"date":"2024-11-18T08:14:25","date_gmt":"2024-11-18T13:14:25","guid":{"rendered":"https:\/\/ibkrcampus.com\/campus\/?p=215225"},"modified":"2024-11-19T04:21:31","modified_gmt":"2024-11-19T09:21:31","slug":"chart-advisor-election-rally-hangover","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-election-rally-hangover\/","title":{"rendered":"Chart Advisor: Election Rally Hangover"},"content":{"rendered":"\n<p>By\u00a0<a href=\"https:\/\/links.investopedia.com\/u\/click?_t=36ba8fa8372241d58b3bfc06997a4332&amp;_m=1bf810f2f976430295a1fc73e370bc91&amp;_e=XZV6s_Atkrf2jaFngSLITNC1wYSoGcJnxlaRuqjBElQvX3l7pyOzIVrnRAdy9t2VuW5AhvRdnEGpCXij0hzY_nqWxP3VV0O56bVUxDjbsWlkzP0787s85iIqg8GcTTsY_kmXI14AiMclUnOMnvOtzSo7fbZvi5pIlcSa4CT2bYj2h1tNSWJUPTHIedvp-fvundgb6dNL9RetaemBlthlgpiSFz7Aw_42Sxsx0L-7TIaR112Eycrj69wfck_xEhNz4kZ-FXmxK1E-KwLeNC5iy1LvDrEUUdmX3P7QoBvApBaKpA4CcIuTIfKTle2BHOjeIPuB0Ixb6NNQDN4UewOovREntrR5y1wZSEnbhUp600vBJEH5PD6RY1e67hfwHHm7QiX6kRUwGsIWRWK0OE6Oo72JjxdBHNL40jKKeTLxVTqLoO3bJHuXWMMxZgTidjI1aTYvqSfgWy1_IrMdoH53nevOQzkhSJmsAb2ShwTXA0Y%3D\">Jay Woods, CMT<\/a><\/p>\n\n\n\n<p>1\/\u00a0<strong>Election Rally Hangover\u00a0<\/strong><\/p>\n\n\n\n<p>2\/\u00a0<strong>Nvidia Earnings<\/strong><\/p>\n\n\n\n<p>3\/\u00a0<strong>Stocks to Watch: NFLX, WMT, PANW<\/strong><\/p>\n\n\n\n<p><em>Investopedia is partnering with CMT Association on this newsletter. \u00a0The contents of this newsletter are for informational and educational purposes only, however, and do not constitute investing advice. The guest authors, which may sell research to investors, and may trade or hold positions in securities mentioned herein do not represent the views of CMT Association or Investopedia. Please consult a financial advisor for investment recommendations and services.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-1\">1\/<\/h2>\n\n\n\n<p><strong>Election Rally Hangover\u00a0<\/strong><\/p>\n\n\n\n<p>The market lacked a follow through punch as the post-election rally on Wall St. faded. In fact, the market went into hangover mode as it gave back half of its recent gains.<\/p>\n\n\n\n<p>This week the market hopes to lift itself back off the mat and come back fighting. It will be about individual stocks stealing the spotlight as market moving economic data is light. There are a few good undercard earnings to watch, but the main event will be the earnings release of 2023 and 2024\u2019s heavyweight champ in&nbsp;<strong>Nvidia<\/strong>.<\/p>\n\n\n\n<p>The S&amp;P 500 fell by -2.1% to close at 5870.62. Overall, it wasn\u2019t that alarming of a drawdown, but does set us up at an interesting technical level heading into this week.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"725\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1549_storage.mlcdn_.com_-1100x725.jpeg\" alt=\"\" class=\"wp-image-215226 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1549_storage.mlcdn_.com_-1100x725.jpeg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1549_storage.mlcdn_.com_-700x462.jpeg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1549_storage.mlcdn_.com_-300x198.jpeg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1549_storage.mlcdn_.com_-768x506.jpeg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1549_storage.mlcdn_.com_.jpeg 1459w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/725;\" \/><\/figure>\n\n\n\n<p>Technically, this move can be seen as constructive. The index got to its highest level on its RSI since July and retreated. However, it never was overbought. This was a pattern we noticed on each subsequent high before a small retracement.<\/p>\n\n\n\n<p>This tells us the recent move wasn\u2019t too frothy and can be viewed as a normal retracement at this time. Watch the 5860 area for support. That was the highest close before we gapped above the level post-election. Any failure to hold that and a sell-off to the rising 50-day moving average at 5770 is plausible.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-2\">2\/<\/h2>\n\n\n\n<p><strong>Nvidia Earnings<\/strong><\/p>\n\n\n\n<p>It is now the biggest stock in the world based on market cap, thus having the biggest weighting in the S&amp;P 500. They are the chip supplier to most of the other \u201cMagnificent 7\u201d stocks and now a member of the Dow Jones Industrial Average.<\/p>\n\n\n\n<p>This one is so big it gets its own section. It will move markets. Let\u2019s break it down &#8211; technically of course.&nbsp;<\/p>\n\n\n\n<p>In this chart going back to its October 2022 bottom we examine the climb and pauses along the way. This chart should be used in any introduction to technical analysis class that wants to show a textbook bull run. The stock has gone through several cycles of accumulation and consolidation. These patterns have also occurred seasonally.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"724\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1559_storage.mlcdn_.com_-1100x724.jpeg\" alt=\"\" class=\"wp-image-215227 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1559_storage.mlcdn_.com_-1100x724.jpeg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1559_storage.mlcdn_.com_-700x461.jpeg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1559_storage.mlcdn_.com_-300x198.jpeg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1559_storage.mlcdn_.com_-768x506.jpeg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_1559_storage.mlcdn_.com_.jpeg 1461w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/724;\" \/><\/figure>\n\n\n\n<p><em>That uptrend\u2026&nbsp;<\/em>it\u2019s textbook. Shares bottomed in October 2022 and began the climb higher and have yet to look back. In early 2023 the stock experienced a \u201cgolden cross\u201d &#8211; a buy signal when the 50-day moving average crosses above 200-day. This can be a lagging indicator, but over the long-term it can be a great trending prognosticator.<\/p>\n\n\n\n<p>The stock retraced all of its 2022 loss and then broke out to new highs in June 2023. Shares gapped on earnings several times (in green) and never looked back. Then over the second half of the year it lost momentum and even earnings couldn\u2019t save it. The stock traded in a long neutral range from June to December of 2023 before breaking out in January. The momentum continued into its February earnings. It slowed again in June and a solid August earnings failed to lift it higher.<\/p>\n\n\n\n<p>Today we see the same trend playing out. Shares consolidated in a wide neutral range going back to June. However, in both cases when shares consolidated the RSI showed a positive bullish divergence. The strength in its RSI even while price was fairly neutral, was a harbinger of positive price action ahead.<\/p>\n\n\n\n<p>The set-up going into this earnings cycle is quite similar. The stock has had a tremendous year (up 185% year-to-date) and is holding on to those gains. It looks ready to take that next leg higher &#8211; or worst case fall back into its recent neutral range. Even in that range the lows get higher and higher and that makes the case for a move upward as well.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"756\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15541_storage.mlcdn_.com_-1100x756.jpeg\" alt=\"\" class=\"wp-image-215228 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15541_storage.mlcdn_.com_-1100x756.jpeg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15541_storage.mlcdn_.com_-700x481.jpeg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15541_storage.mlcdn_.com_-300x206.jpeg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15541_storage.mlcdn_.com_-768x528.jpeg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15541_storage.mlcdn_.com_.jpeg 1346w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/756;\" \/><\/figure>\n\n\n\n<p><em>Earnings reaction pattern\u2026<\/em>&nbsp;The big moves tend to happen in spring and summer and then the stock rests in autumn to year end. Are we about to see a continuation of that resting period?<\/p>\n\n\n\n<p>Shares have consistently beaten estimates and chances are they will do it again this quarter, but will it be enough to take another sizable leg higher? The average move on earnings days are +\/- 7.4%, but not over the last two reporting quarters of the year.<\/p>\n\n\n\n<p>There\u2019s something about that August and November release that never seems to ignite the rally. The last three August\u2019s have seen the stock gain 4.01%, 0.10% and lose 6.38%, respectively. The last two November\u2019s saw declines of -1.46% and -2.46%. Will this November break the streak?<\/p>\n\n\n\n<p><em>What\u2019s Different This Time?<\/em>&nbsp;Coming into earnings&nbsp;<strong>NVDA&nbsp;<\/strong>is outperforming the&nbsp;<strong>VanEck Semiconductor ETF &#8211; SMH<\/strong>&nbsp;by its greatest margin ever. Usually the semis have trended better than or if not equal to&nbsp;<strong>NVDA.<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"552\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15628_storage.mlcdn_.com_-1100x552.jpeg\" alt=\"\" class=\"wp-image-215229 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15628_storage.mlcdn_.com_-1100x552.jpeg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15628_storage.mlcdn_.com_-700x351.jpeg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15628_storage.mlcdn_.com_-300x151.jpeg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15628_storage.mlcdn_.com_-768x385.jpeg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15628_storage.mlcdn_.com_.jpeg 1343w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/552;\" \/><\/figure>\n\n\n\n<p>Lately the semiconductor sector as measured by the&nbsp;<strong>SMH&nbsp;<\/strong>has been underperforming the overall market since its peak in July. It is currently -15% off its highs, while&nbsp;<strong>Nvidia,&nbsp;<\/strong>which makes up 23.6% of that index, made a new high just last week.<\/p>\n\n\n\n<p>This begs the question coming into Wednesday afternoon\u2019s result &#8211; will it bring the sector back to life or will it be sucked down with it as well?<\/p>\n\n\n\n<p>The hope is that it beats its raised guidance &#8211; again &#8211; and gets the follow through to the upside. But as we\u2019ve seen during this seasonal period it doesn&#8217;t always work that way.<\/p>\n\n\n\n<p>No matter which way it breaks, it will have a huge impact on the technology sector and the overall market itself.<\/p>\n\n\n\n<p><em>Levels to Watch\u2026&nbsp;<\/em>So where can the stock go next? A breakout on positive earnings another 25-35% pop is likely. The momentum will be there, but wait to see if any after hour momentum continues over the first hour of trading on Thursday.<\/p>\n\n\n\n<p>To the downside, the 100-day moving average has been a good barometer for the stock over the last year. It has only closed below this level SIX times in the last year and each dip has been a good buying opportunity. That would bring shares to the $124.75 area. Ultimate support is around $100. To get there it would take a shockingly unexpected event to occur. That seems unlikely.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-3\">3\/<\/h2>\n\n\n\n<p><strong>Stocks to Watch: NFLX, WMT, PANW<\/strong><\/p>\n\n\n\n<p><strong>Netflix\u00a0<\/strong>made its biggest splash into the world of sports streaming last Friday night to mixed reviews. The much hyped Jake Paul vs Mike Tyson fight fell flat to those wanting great pugilistic action, but the streaming giant reported 60 million households worldwide tuned into the event.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"753\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15720_storage.mlcdn_.com_-1100x753.jpeg\" alt=\"\" class=\"wp-image-215230 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15720_storage.mlcdn_.com_-1100x753.jpeg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15720_storage.mlcdn_.com_-700x479.jpeg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15720_storage.mlcdn_.com_-300x205.jpeg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15720_storage.mlcdn_.com_-768x526.jpeg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15720_storage.mlcdn_.com_.jpeg 1337w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/753;\" \/><\/figure>\n\n\n\n<p>However with 60 million+ concurrent streams there were a few glitches that had many viewers up in arms. Close to 100,000 customers reported lagging issues, poor image quality and their stream failing completely. This leaves viewers and investors questioning how Netflix will be able to handle the demand for its NFL debut on Christmas Day.<\/p>\n\n\n\n<p>The good news is that they have a month to resolve these issues. The hope is that the focus at the Monday watercooler will be on that great undercard between Katie Taylor and Amanda Serrano and the thievery of the judges, and not on the main event and streaming issues that plagued many viewers.<\/p>\n\n\n\n<p>Going into this week Netflix shares are trading at $823.96 and are up 69% year-to-date.<\/p>\n\n\n\n<p><strong>Earnings.&nbsp;<\/strong>The slate of reports is starting to ease, but this week we get many sector leaders that could impact markets.&nbsp;<strong>Nvidia<\/strong>&nbsp;is not only the biggest stock in the world, but it will have a severe impact on semiconductor stocks. In retail, we get three of the biggest names&nbsp;<strong>Walmart, Target&nbsp;<\/strong>and&nbsp;<strong>Lowe\u2019s.&nbsp;<\/strong>Lastly one of the biggest names in cybersecurity reports in&nbsp;<strong>PaloAlto Networks.<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1100\" height=\"665\" data-src=\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15750_storage.mlcdn_.com_-1100x665.jpeg\" alt=\"\" class=\"wp-image-215231 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15750_storage.mlcdn_.com_-1100x665.jpeg 1100w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15750_storage.mlcdn_.com_-700x423.jpeg 700w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15750_storage.mlcdn_.com_-300x181.jpeg 300w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15750_storage.mlcdn_.com_-768x464.jpeg 768w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2024\/11\/Screenshot_18-11-2024_15750_storage.mlcdn_.com_.jpeg 1289w\" data-sizes=\"(max-width: 1100px) 100vw, 1100px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/665;\" \/><\/figure>\n\n\n\n<p>&#8212;-<\/p>\n\n\n\n<p>Originally posted 18th November 2024<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By\u00a0Jay Woods, CMT 1\/\u00a0Election Rally Hangover\u00a0 2\/\u00a0Nvidia Earnings 3\/\u00a0Stocks to Watch: NFLX, WMT, PANW Investopedia is partnering with CMT Association on this newsletter. \u00a0The contents of this newsletter are for informational and educational purposes only, however, and do not constitute investing advice. The guest authors, which may sell research to investors, and may trade or [&hellip;]<\/p>\n","protected":false},"author":186,"featured_media":215232,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":true,"footnotes":""},"categories":[18,6,8,9,22,23,26,3],"tags":[11015,590,1385,10183,8289,207,1212],"contributors-categories":[13686],"class_list":{"0":"post-215225","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-macro","8":"category-north-america","9":"category-region","10":"category-securities","11":"category-stocks","12":"category-technical-analysis","13":"category-text-articles","14":"category-traders-insight","15":"tag-nfl","16":"tag-nflx","17":"tag-nvda","18":"tag-nvdia","19":"tag-panw","20":"tag-spx","21":"tag-wmt","22":"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 v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Chart Advisor: Election Rally Hangover | Traders&#039; Insight<\/title>\n<meta name=\"description\" content=\"This week the market hopes to lift itself back off the mat and come back fighting. 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