Navigating the Markets for Beginner Traders and Investors
We’re Back!
“Market fluctuations are your friend, not your enemy…profit from the folly rather than participate in it.” Warren Buffet
Welcome to the Slow Money (Bi)Weekly newsletter
-formerly Market Adventures | Beginner’s Digest
Thoughts? 👇🏾
What a crazy week! Immediately after the last publication, we had 2 consecutive days of market weakness and dollar strength, consistent with the summary of the charts in the post.
AND THEN…up up up to all-time highs by the end of the week. Anyone hoping for a crash and holding on to short positions that were winning, ended the week losing.
Slow money is about see money, take money. Don’t try to get rich on a single trade.
I also mentioned earnings season last week. That means ANYTHING can happen. That, along with crazy consumer sentiment data (78.8% vs 69.7%), were huge drivers for that end of the week price movement.
Here’s what’s coming up this week to pay attention to:
Mon -
09:00 AM European Central Bank President Lagarde Speech
10:00 PM Bank of Japan Interest Rate Decision
Thurs -
08:15 AM ECB Interest Rate Decision
Fri -
08:30 AM Core PCE Price Index MoM (month-over-month)
There is a lot more data that will come out, but I believe these will be the only things that will cause much of a stir amidst the excitement of corporate earnings.
What are your thoughts on the market? Are you feeling inflation or economic weakness in your everyday job?
Below you’ll find market information, education, and opinions. If you bought the stock market 101 course, this is where you put that information to work. Must read disclaimer at the end of this publication.
Fear & Greed
Greed is high and we’re at all-time highs. Does that mean we’re going to keep going up or crash in-bound?
Well, here’s an easy way to think about it. We’ll keep going up, until we’re not. Regardless of what we think or feel, we’re in a clear uptrend. Now, are there points of weakness? Yes.
What that means for me is that taking small profits up here is a good idea. Why? If I’m short and it goes down, I’ll win…but the trend could continue and continue violently. If I’m long and it goes up, I’ll win. And I could very well keep winning, unless the greed is met with an unexpected global event or overwhelming downward pressure. The trend is up, I’ll be playing the trend and taking profits at the 1st sign of weakness.
Earnings are the most important thing moving forwards, but keep and eye on the Fed Watch tool.
A Technical Look
The Broader Market | S&P 500
A Summary of the charts below:
“If prices push past all-time highs, I’ll wait.”
This was comment last week, and that’s what I’ll do. My guess is that there’s optimism going into earnings season, especially given the print on consumer sentiment last week. New highs, uptrend, good data, earnings. None of us is rich enough to stop a moving train, so get out the way or get on.
I’m holding a call option on a stock going into this week. 1st sign of weakness, I’m taking my profits if I’m up. Pay attention to the dollar; it’s at 200 MA resistance with bullish technicals. If it can find a way above resistance, bye-bye stocks. If it falls, to the moon we go.
This is a 3 year Weekly chart of the S&P 500 index (SPY)
*I drew this week. Don’t judge my arrows!*
MACD - Strong green. Fought off those last 2 darker, weaker histos.
RSI - Negative divergence with higher highs in prices without higher high in RSI
This is a 1 year Daily chart of the S&P 500 index (SPY)
MACD - Flat/lower despite higher prices. Histos looking to turn green
RSI - lower highs, same negative divergence. Pushing back up to 70
This is a 1 year Daily chart of the Dollar index ($DXY)
MACD - Strengthening histograms, double bottom. Weakness last week. At resistance, 200 MA.
RSI - Positive divergence. Turning towards 50 line
FIND A WAY TO
PUT YOUR MONEY TO WORK
Long-Term Holdings
This Month’s Long-term Stock Pick
Disney DIS 0.00%↑ Current Price: $93.06 (up 3% since last publication)
This is in line with philosophy that you should own what you use. My children love Disney, especially my daughter. As you can see, they are already owners of the stock. Adding to it below $90 again.
There are a bunch of reasons to like Disney stock. The fact that they started paying dividends again is HUGE. Right now the stock is where it was in 2015, almost a decade ago. Could it plummet further? Possibly. Is it unlikely unless there is some massive event unrelated to the company.
BUSINESS SUMMARY (source: TdAmeritrade)
Disney is a diversified media company and makes money through several businesses, including cable networks, broadcasting networks, theme parks & hotels, filmed entertainment, and consumer products. The company has also added a direct-to-consumer business to its portfolio recently.
Its cable networks include ESPN, the Disney Channel, ABC Family, and others. Disney's broadcasting arm, ABC Network, is one of the biggest broadcasting networks in the U.S., with a wide viewership.
Besides TV networks, Disney boasts several theme parks and resorts that attract millions of visitors every year. Furthermore, the company leverages its famous characters and brands to sell various merchandise. Its filmed entertainment unit produces and distributes movies under the Disney Studios brand.
Where My Money Is
My Current Swing Trade Positions: TSLA 0.00%↑ 2 FEB 240 Call
My Current Long-Term Holdings: MMM 0.00%↑ WBA 0.00%↑ PFE 0.00%↑ T 0.00%↑ KO 0.00%↑ O 0.00%↑ SBUX 0.00%↑ SQ 0.00%↑ AAPL 0.00%↑
My Son’s Long-Term Holdings: DIS 0.00%↑ RBLX 0.00%↑ O 0.00%↑ PFE 0.00%↑
My Daughter’s Long-Term Holdings: DIS 0.00%↑ SNAP 0.00%↑ AGNC 0.00%↑ PFE 0.00%↑
Book Club
Honest opinion so far, the authors push their “rightness” too much. Though they had accurate assumptions prior to the 2008 financial crisis, their position in this book so far appears to be wrong.
I’ll find out more as I read, but so far I’ve learned a few things about the interplay of different socioeconomic factors that may be useful later on-on the investing journey.
Disclaimer. Must Read.
Please read 👇
“This newsletter and all related Market Adventures content is not investing advice. Everything you are about to read is merely the opinion of the writer. Please seek the counsel of a financial advisor prior to making any investment decisions. Though the stock market does present many opportunities to make money, there are an infinite number of ways to lose all or more than your original investment. That being said. Don’t invest or trade in any security mentioned in this publication or its related content.”