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Zacks Investment Ideas feature highlights: UUP, Nvidia, AMD and SOXL
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For Immediate Release
Chicago, IL – September 29, 2023 – Today, Zacks Investment Ideas feature highlights Invesco USD Index Bullish Fund ETF (UUP - Free Report) , Nvidia (NVDA - Free Report) , Advanced Micro Devices (AMD - Free Report) and Direxion 3x PHLX Semiconductor Sector Index (SOXL) .
The Equity Bull Case (5 Must-See Charts!)
Want to know what a market will do? Consulting a chart is the best way to see what will happen next, because charts are based on the simplest tenants of economics – supply and demand. Below are 5 must-see charts that suggest the market is closer to a bottom than you may think:
CNN Fear & Greed Index
The CNN Fear & Greed Index measures investor sentiment in the US equity market. Fear & Greed is derived through a composite of factors, including market trend, stock price strength, breadth (participation), put-to-call ratio, volatility, trading volume, and safe-haven demand. From its diverse bucket of metrics, CNN then creates a numerical score from 0 to 100, with 0 being extreme fear and 100 being extreme greed.
Spin:Fear & Greed is best used as a contrarian indicator. In the words of General George S. Patton, "If everyone is thinking alike, then somebody isn't thinking." The fact that CNN's Fear & Greed Indicator is at an extreme greed level and is at the lowest level of 2023 should give bulls hope for a year-end rally.
The US Dollar
An overly strong US dollar can adversely affect US equities. For example, an inflated dollar can hurt the competitiveness of American exporters (US goods & services become more expensive), weigh on US-based multinationals (overseas earnings get transferred back into dollars, reducing corporate profits), and finally can detract foreign investment into US equities themselves.
Spin: The US Dollar Index (DXY) and the Invesco USD Index Bullish Fund ETF are up eleven straight weeks and are approaching resistance (supply). A pullback in the US Dollar would be supportive of equities.
Seasonality
In 2023, historic seasonal trends have perhaps been the best, most accurate roadmap for investors. The pre-presidential election roadmap is the optimal roadmap for investors to consult. Typically, equities rally into the late summer (like in 2023) and bottom in late October.
Spin: Because seasonality has been so accurate, investors have little reason to abandon it now. Look for a rally into year-end.
Semis
Semiconductor stocks such as Nvidia and Advanced Micro Devices are the lifeblood of the current bull market. Why? A major part of the bull case in equities is that the AI revolution will lead to higher earnings and allow high-tech stocks to grow into their seemingly lofty valuations.
Spin: The Direxion 3x PHLX Semiconductor Sector Index stood out Thursday, rising more than 7% for the session while finding support at its 200-day moving average. Buying interest in semiconductors is indicative of a "risk on" mood.
Bottom Line
After lulling investors to sleep in the past few months, several charts suggest that equities may wake up in a big way into year-end.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: UUP, Nvidia, AMD and SOXL
For Immediate Release
Chicago, IL – September 29, 2023 – Today, Zacks Investment Ideas feature highlights Invesco USD Index Bullish Fund ETF (UUP - Free Report) , Nvidia (NVDA - Free Report) , Advanced Micro Devices (AMD - Free Report) and Direxion 3x PHLX Semiconductor Sector Index (SOXL) .
The Equity Bull Case (5 Must-See Charts!)
Want to know what a market will do? Consulting a chart is the best way to see what will happen next, because charts are based on the simplest tenants of economics – supply and demand. Below are 5 must-see charts that suggest the market is closer to a bottom than you may think:
CNN Fear & Greed Index
The CNN Fear & Greed Index measures investor sentiment in the US equity market. Fear & Greed is derived through a composite of factors, including market trend, stock price strength, breadth (participation), put-to-call ratio, volatility, trading volume, and safe-haven demand. From its diverse bucket of metrics, CNN then creates a numerical score from 0 to 100, with 0 being extreme fear and 100 being extreme greed.
Spin:Fear & Greed is best used as a contrarian indicator. In the words of General George S. Patton, "If everyone is thinking alike, then somebody isn't thinking." The fact that CNN's Fear & Greed Indicator is at an extreme greed level and is at the lowest level of 2023 should give bulls hope for a year-end rally.
The US Dollar
An overly strong US dollar can adversely affect US equities. For example, an inflated dollar can hurt the competitiveness of American exporters (US goods & services become more expensive), weigh on US-based multinationals (overseas earnings get transferred back into dollars, reducing corporate profits), and finally can detract foreign investment into US equities themselves.
Spin: The US Dollar Index (DXY) and the Invesco USD Index Bullish Fund ETF are up eleven straight weeks and are approaching resistance (supply). A pullback in the US Dollar would be supportive of equities.
Seasonality
In 2023, historic seasonal trends have perhaps been the best, most accurate roadmap for investors. The pre-presidential election roadmap is the optimal roadmap for investors to consult. Typically, equities rally into the late summer (like in 2023) and bottom in late October.
Spin: Because seasonality has been so accurate, investors have little reason to abandon it now. Look for a rally into year-end.
Semis
Semiconductor stocks such as Nvidia and Advanced Micro Devices are the lifeblood of the current bull market. Why? A major part of the bull case in equities is that the AI revolution will lead to higher earnings and allow high-tech stocks to grow into their seemingly lofty valuations.
Spin: The Direxion 3x PHLX Semiconductor Sector Index stood out Thursday, rising more than 7% for the session while finding support at its 200-day moving average. Buying interest in semiconductors is indicative of a "risk on" mood.
Bottom Line
After lulling investors to sleep in the past few months, several charts suggest that equities may wake up in a big way into year-end.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.