Monday, June 12, 2017

Banks VS FANGS - Buying opportunity

The stock markets punished US tech stocks last week, and biggest tech names saw the worst of it. Apple, Alphabet, Microsoft, Facebook and Amazon — lost more than $97.5 billion in market value between the close on Thursday and the close on Friday.

Shares of Apple fell nearly 4 percent on Friday, while the other four companies fell more than 3 percent. However they are near the trend line supports and this may represent a wise buying opportunity.

According to Dennis Gartman,

"We have included the chart of the NASDAQ at the lower left of p.1 this morning, noting that the lows on Friday amidst sheer panic selling in the early afternoon took the Index to a trend line that we extend back to the lows of last July, although we show it only into the lows of mid-April of this year. It shall take courage on our part to believe that the bull market is still intact, but in fact it is. Thus, if the NASDAQ were to fall back toward 5675 or so today we shall have to be a buyer, for as Old Turkey would remind us, “After all, this is a bull market.” Further, a drop to 5675 shall only be a 3.8% correction from the peak. 
Finally, if the NASDAQ does test those lows, our urge shall be to own banking shares above all else for the banks did amazingly well on Friday, rising smartly even as the FANGSs were collapsing, predicated upon the Fed moving to tighten monetary policy at its meeting this week and thus widening net-interest income for the banks… the real driver of bank earnings. Regional banks, especially, may be best served, with the ETF soaring 3.1% on Friday and breaking out to the upside. Any periods of weakness this week are to be bought."


www.zerohedge.com/news/2017-06-12/gartman-nasdaq-one-day-will-collapse-buying-today-weakness-should-be-wise