Last night I had the strangest dream

I sailed away to China

In a little row boat to find ya

And you said you had to get your laundry cleaned

Didn't want no one to hold you

What does that mean? -Matthew Wilder 

Mega-cap technology was already coming on strongly, but got an extra spark from the news that Elon Musk has taken a 9.2% stake in Twitter (TWTR). The news riled up investors that ran in many directions looking for opportunities in beaten-down niches of the market that have been juggernauts in the past. If a stock like Twitter could eventually live up to the hype, then so could many others that had fallen out of favor.

Chinese Technology

• Invesco Golden Dragon China ETF (PGJ): +7.53%
• KraneShares CSI China Internet ETF (KWEB): +7.65%

Given up for dead just two weeks ago,,Chinese technology has come roaring back, as officials appeared to have blinked and are ready to acquiesce to more rigorous rules for those shares to remain listed on U.S. exchanges. Yesterday’s move was led by the Alibaba Group (GBABA), which celebrated its 23^rd birthday. 

Talk of moving away from Russian energy in Europe attracted investors.

Rare earth stock moved higher for similar reasons. The stuff isn’t rare, just dirty and dangerous to mine.

I like solar stocks and rare earth names as trading vehicles, as it’s unlikely fundamentals will be allowed to match the hype. We should have control of so-called rare earth minerals, but we gave it away a long time ago with so many other essentials of life and security.

Heat Map

Rotation moved into hyperdrive as mega-caps and Consumer Discretionary (XLY) took off as value and defensive names stumbled.

Market Breadth

There were twice as many new highs than lows on the New York Stock Exchange (NYSE), and one more high than low on the NASDAQ Composite. These are effective, easy signs of the general direction of the stock market. Volume was light, but a couple more clicks higher, and the buying floodgates could open.

Market Breadth	NYSE	NASDAQ
Advancers	1,842	3,061
Decliners	1,529	1,755
New Highs	99	81
New Lows	47	80
Up Volume	2.93 billion	3.32 billion
Down Volume	1.50 billion	1.17 billion

Real Bond Yields

Bond yields are on the rise and inverting, but real yields are still negative, and as long as they are, the negative talk of being an alternative to stocks falls on deaf ears.

Portfolio Approach

We added a new position in Technology yesterday to our Hotline Model Portfolio.

Today’s Session

It’s one of those days – we have FOMC minutes tomorrow and this is a pause to digest gains and test weaker hands. 

Comments

Yea! On the road with Charles listening to Making Money while delivering " Meals on Wheels" Lorin on 4/5/2022 2:32:25 PM

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