Morning Note 01/31/24 ─ Our Analysis We analyze markets through a holistic lens considering not only fundamentals and technicals but also sentiment and catalysts. We monitor 400+ stocks we are familiar with, some deeply so, after conducting CEO interviews, for daily catalysts. Based on our knowledge, we can quickly judge the impact of a catalyst on both sentiment and fundamentals and then refer to technicals to arrive at a price target. Through our holistic analysis we seek to anticipate the anticipation of others. Because we believe markets are efficient, we seek rapid re-ratings right after or in anticipation of a catalyst. Often, price targets hit on the same day. We have become known for our track record of our #1 pick of the day. Historically, nearly 80% of the time our #1 pick of the day sees a significant positive move on the day from the pre-market or 9:30am opening price. This makes leverage particularly appealing for our top picks. Additionally we provide commentary on the macro outlook and geopolitical risks as these can impact our conviction level on top picks for the day. Yesterday’s Performance - ❌ GM -0.5% ✅ BA (short) +1.6% ✅ ZIM swing +2.63% ✅ URNM swing entry +2.6% ✅ MSOS swing breakout +0.75% ❌ CLRB swing entry -5.25% ❌ SMCI failed to trigger. Opened below $550 support Compare with SPY -0.8% for the day. Macro Big tech earnings continued last night from GOOGL MSFT and AMD with nothing majorly positive to note. This led to a drop in QQQ of over 1% ahead of FOMC today as China stocks tumble to a 5-year low after weak manufacturing data. All eyes will be on Powell’s comments today but regardless it may be time for a correction in QQQ and SPY as both are well above the 20 DMA. Risk assets as represented by IWM and ARKK have a better chance of having a logical reaction to Powell’s comments. It may be wise to stay clear of the market until clarity after the 2pm presser. 2 Geopolitical The Iranian group which attacked the US base backed off and said they would stop attacks while Israel advances negotiations for a cease-fire with Hamas. Popular - BTC $41,838 support. $43,850 and $44,500 resistance.. - TSLA a Delaware judge struck down Elon Musk’s $55B pay package which raises the concern that he will not have enough voting power for AI and other projects to be done under TSLA. However the remedy seems simple although it will take time. They simply need to pass the package again with clearer disclosures about board control. In the meantime the stock is reacting negatively. Continue to avoid unless it reaches the $160 to $180 support range on valuation concerns. Swings - ✅ KWEB swing removal paid off as China stocks drop to new lows on economic data. - ZIM URNM and MSOS swings still in play amidst a possible market pull-back. ZIM has “white swan” risk of a sudden peace of cease-fire occurs in the Middle East but otherwise a move to $16 to $20 seems imminent. URNM looks poised for a move to $58 after the 20 DMA bounce and gap-fill triggered on Monday. MSOS may be the most vulnerable to an overall market pullback but we are maintaining a bullish stance on this with $9.88 target and breakout level. - DRIO and YTRA no further imminent move expected unless a catalyst hits or technical signals trigger. DRIO is near $2 support with price objective still at $2.50 to $2.85 level upon release of Aetna launch news.. Other Key Catalysts Today - AMD MSFT GOOGL SBUX earnings offered nothing significantly positive to chase this morning. NVO ER results were mixed but mostly positive for it’s blockbuster GLP-1 agonist drug. NVO continues to be a long-term hold on this report. 3 - - - PARA receives a buyout offer from Byron Allen for $21+ a share. The stock is up 16% this morning to $16. PARA previously turned down a partial buyout offer from Mr. Allen so a discount is expected until it becomes clear if the offer will be accepted. GHSI with a $6.5M market cap sells an asset for $17M cash. The stock is up 100% in pre-market RKLB announces preliminary Q4 results under expectations but hints that any misses should not bleed into 2024 expectations. They also had a successful Electron mission launch last night. SGML announces 27% increase in Lithium deposits at a Brazil mine making this mine the 4th largest lithium mine in the world. Top Picks Today Careful consideration is made in ranking a pick as #1. Our track record on “#1 picks” remains at around 80% over hundreds of historical selections with moves of 5-15% on the day from 9:30am open to 4pm close being very common. There is not always a number one pick each day. If there isn’t a top pick, the top ideas will be noted with dashes rather than in numerical order. Despite several catalysts noted above, none are so compelling as to overcome the market weight of a QQQ pullback or possible hawkish comments by Powell this afternoon. GHSI and PARA may be good trading vehicles today as they will be highly volatile and liquid with expected bounces off support levels. Other than this our top ideas today for continued positive movement in-spite of any market headwinds are: 1. URNM on technical bounce and trigger with $58 swing target. This can also be played with CCJ target $51 2. ZIM with near-term large breakout to $16 to $20 level however note the “white swan” risk due to recent positive signs with Iran and Hamas. 3. GM off of yesterday’s earnings looks like it wants to notch in a second green day. $38.96 and $39.71 targets. $38 support. ─ How can we make our service more useful for you? Please provide feedback on timing, content, and style of this daily note on whatsapp 917-704-1445
