"BANKS GIVE PAUSE" - Regional Banks Fail Breakout, Small/Mid Caps Hit, Metals Parabolic

 

"BANKS GIVE PAUSE" - Regional Banks Fail Breakout, Small/Mid Caps Hit, Metals Parabolic

🚨 BANKS - THE BIG STORY (Gary's #2 Watch After Semis)

Regional Banks: Broke out beautifully 2 days ago, failed today - "tucked its head in like a frightened turtle"

Major Banks Breaking Down:

• Goldman Sachs: -$35, breaking 21-day with volume
• JPM: Down 13% in 2.5 weeks, below 50-day, approaching 200-day - "deeper into its recent drop"
• Wells Fargo: Gap down on earnings, "living below 50-day"
• Bank of America: Gap down on earnings, below 50-day
• Citigroup: "Dropped like a rock on earnings," between 50 and 21-day
• Capital One: -$17.77 (-7.6%), "breaking all support" (credit card issue)

Banks That Acted Well:

• Bank of New York: Acted well on earnings
• Morgan Stanley: Great reaction to earnings, but gap down Tuesday, broke 21-day

Gary: "Number two is the financials in the banks. So that has us very much on notice. Because if the banks gap... elevator up on breakout, elevator down, quickly gives pause."

"We don't want to see financials go by the wayside."

📉 Small/Mid Caps - Pullback

• Small caps: -1.8%
• Mid-caps: -1%
• Dow: -285 (Goldman + Caterpillar = $57 = 370 Dow points alone)

Gary: "We have some decent cushion in the mid-caps. We gave back some... Not thrilled."

"The thought process of what drives the bus in small and mid caps, boy these financials. Big time, these financials."

🟢 NASDAQ Better - Mega Caps Woke Up

• NASDAQ 100: +0.35% (was much better early, came in late)
• Microsoft: +$14+, "woke up yesterday, another good day today" ahead of earnings
• Meta: Woke up
• Amazon: Woke up

Gary: "While the Russell 2000 was down 1.8%, the NASDAQ 100 was up 0.35... better day for the NASDAQ, NASDAQ 100."

🥇 METALS - "WOW" Parabolic Moves

Silver: "At another high... nearing 100% from late November breakout"

• Closed $93 with 50-day at $60 ("that's a lot of territory if it decides to come in")
• Gary: "Silver, stodgy silver, that basically did nothing for 15 years"
• "There have been days in the last three weeks that looked like it was going to come in. It just went up the next day."
• "Pretty much breaking all rules of technical analysis"

Gold: $418 → $457 in 7-8 days - "just a big wow"

Platinum: $87 → $250 in 8 months

Palladium: $95 → $184 in 8 months

Also strong: Copper, steel stocks, mining ETFs (XME)

Gary: "Isn't this inflationary? Isn't it? Anything made with platinum, you're going to pay through the nose."

"The big stories here are these metals. Wow."

📊 Semiconductors - Weaker

• SOX: Down ~100
• SanDisk: Finally dropped $30 "way overdue"
• Equipment makers: AMAT, KLAC still up
• Taiwan Semi: Up

Gary: "Some casualties today, but not so bad."

🏦 Other Financials Hit

M&A Companies: BlackRock, Blackstone, Evercore - casualties

Capital One: -$17.77, -7.6%, "breaking all support" - already gapped down on credit card news

Gary: "I'm wondering, did that cause it today?... certainly can't be ruled out."

📅 EARNINGS NEXT WEEK - The Big 4

This Week: Apple, Meta, Microsoft, Tesla Week After: Amazon, Google

Gary: "That's four out of the big eight."

Gary's Concerns

On Banks: "Number two is the financials in the banks. So that has us very much on notice."

"The banks have been a breath of fresh air. A few of them are now anchors. And today, very much into the lost column."

On "Greatest Economy" Talk: "All we hear right now... from the President, Golden Age, 18 trillion. He actually said he expects the market to double... Greatest economy ever... And when I hear all this stuff, the talk of perfection, the greatest economy ever, I worry. I worry. I very much worry."

On Housing/Government: "I don't want government touching housing. Housing is normalizing itself right now. Government should stay the hell out of the way."

"Jay Powell... caused all this. All of it. Distortions create distortions... printing to $9 trillion, buying up the bond market, taking the 10-year down to half percent, giving you your 3% mortgages, nobody wanting to sell, which guarantees prices are going to soar."

"Let price find its own level. Let supply and demand find an equilibrium."

On Silver: "I'm beside myself that I didn't buy the silver weekly breakout back in June, and the one in November."

"Is it teasing something? Is it telegraphing something? I hope not. That's the best way I can put it."

Gary's Key Quote

"Wicked, wild, weird start to the year. Three gaps to the upside. A fourth a few days later. Strong small and mids only to get cut a little bit today."

"But what sticks out for me today is the banks. They have been a breath of fresh air. A few of them are now anchors."