"MARKET AIN'T GOING DOWN" - Second Big Gap Up, Banks/Semis Strong, Mega Cap Weak

 

"MARKET AIN'T GOING DOWN" - Second Big Gap Up, Banks/Semis Strong, Mega Cap Weak

Market Action (Big Gap Up #2)

• Dow: +594 (was up 800+ at one point) - Caterpillar + Goldman = 340 of 594 points
• S&P: +12 (measly, came in last few minutes)
• NASDAQ: +160
• SOX (Semiconductors): +79 (was up 209 at peak, "got a little worn out")
• Russell 2000: Good hold of 50-day, good move today
• Mid-cap 400: Very good day, back near recent highs, trying for all-time highs

Gary: "Two big gap ups, two days in a row coming out of the box in a year."

"Remember what we told you about the Dow? Two stocks, what was it, Friday, two stocks with 375 of the 319 points. Well, those two stocks today were... about 340 of the 594 points today. That's Caterpillar and Goldman Sachs."

🚀 FINANCIALS: "VERY STRONG, VERY STRONG"

Banks to New Highs:

• Citigroup: +$4.60
• Morgan Stanley: +$4.60
• Schwab: +$2
• Goldman Sachs: +$34 (highest price name in Dow)
• Bank of New York: +$4
• BlackRock: +3%

Also Strong:

• Dutch AP, Morgan, American Express
• Regional banks: "Not as good, but better in recent days"
• SNLs
• Insurance bouncing (financial-related)
• Companies that invest in other companies and bring them public: "Very good day"

Gary: "Market ain't going down, if that's the case."

"Just so you know, I get a lot of people emailing me on the moves in gold and silver, and they say... oh, that's going to be really bearish for the stock market soon. If it is, well, no, it hasn't happened yet. And I got news for you, when the banks are going to new high ground, and regional banks even better... very little chance of the market croaking."

📉 MEGA CAP TECH: WEAK/RANGE BOUND

NVIDIA:

• Down today with NASDAQ up 160
• "Basically now range bound since August"
• Hit 185 in August, now 188
• "Rallied to 212 very quickly, but right back down"
• "I consider that one big gigantic base really going back to August with one shot to the high"
• "That's not helping"

BROADCOM:

• "Even weaker, was down $4+ with the NASDAQ up 160"

APPLE:

• "Really bad action today also"

AMAZON:

• "Been very weak, but up $6 today"

STILL HOLDING:

• Google: "Been the stalwart and doing nothing wrong. It's sitting for the last six weeks"
• Tesla: Better day today but bad Friday

Gary: "Mega caps are holding back."

🟡 SEMICONDUCTORS: Strong But Some Weakness

SOX: +79 (peaked at +209, pulled back)

Weak Within Group:

• NVIDIA: Down
• Broadcom: Down $4+
• Micron: "Finally down"
• Electronic contract manufacturers hit
• Fabless semiconductors hit (Celestica, ALAB)
• Jaypole Circuit: Down $17

Gary: "At one time today was 75, 77, 130, was up 209. So that probably got a little worn out today. I don't think it's a big deal. I think most are still in shape."

🛢️ OIL SECTOR: Bifurcation

UP:

• Big oil: Up nicely (Chevron +$8, Exxon up nicely)
• Oil refiners: Up nicely
• Schlumbergers, Halliburtons, Valeros: Up nicely
• Oil prices: +$1 today

DOWN:

• Oil explorer stocks: Down
• Fangs: Down

Gary on oil prices up: "A lot of people email me, why, with all this oil potential? I have no answer, I have no clue. How's that for a good answer? I don't have an answer why. It is what it is."

🌎 SOUTH AMERICAN STOCKS: Pop on News

• Mercado Libre (South American trading/products): Up 8%
• Copa Holdings (CPA) (Copa Airlines, Panama): Strong
• Latam Airlines (LTM): New yearly highs

Gary: "Some South American airline stocks were strong today... You had that reaction too today."

💰 CRYPTO: Potential Near-Term Low

• Broke above first resistance today
• Holding 6-7 week lows (mentioned previously)

Gary: "Remember we've been saying bear market, but in the last six, seven weeks, holding the lows that you can draw a line underneath? Well, we broke above today a little bit of first resistance. Does not change the overall complexion, but probably changes the near-term complexion."

"I don't want to say the low is in, I'd like to say a type of low is in on the crypto for whatever reason. We never know why this thing goes up or down. It's crypto."

🥇 METALS: Wild Volatility, No Edge

GOLD:

• Gapped up today
• "Still trading above 50-day moving average, a little bit above the highs of October"
• Gold miners: "A little bit above the highs of October"

SILVER:

• "Much stronger than gold, but whipping all over the place"

PALLADIUM/PLATINUM:

• "Recently I've been mentioning this... just showed up"
• "Just the gaps to the upside and downside, I'll just call them insane, 7-8% moves"

COPPER:

• "Looks like it's ready to go into yearly highs"

Gary: "Today it gapped up. Two days ago it gapped down. The day before that it gapped up, the day before that it gapped down. I don't have an answer for you except to say gold is still trailing, trading above the 50-day."

"I have no edge."

📊 INDICES: RANGE BOUND (Critical Context)

S&P 500:

• "One, two, three, four, five, six, seven, eight, nine, in the 10th week of range"
• "Has not moved at all. Little down, little up, has not broken out"
• "Underperforms right now because Broadcom Apple, Microsoft, Netflix" weak

NASDAQ:

• "Has done nothing since beginning of October, up a half percent"
• "From mid-September, up 2%"
• "So even that's back and forth, but I do want to give it the due that the mega caps are holding back"

NASDAQ 100:

• "Looks the same"

INTERNATIONAL:

• EEM (Emerging Markets): Gapped up Friday, more today, into new high ground
  • "EEM is flat from 2007. No, really."
• EIFA Index: New high, "not bad"
  • "Up about 20% since early 2021"
  • "Up 13% from 2007, imagine that. I think our market's a little bit better."
• China (FXI): Trading where it was last March
  • "Hit 73 in October of 2007, it's 40 today. It's been better to be here."
• China internet (KWEB, CWEB): Still 15% off October highs, trading where they were last February

🎨 FROTH BOUNCING AGAIN

Speculative Areas Bouncing:

• Nuclear, quantum, drones, rare earths, bitcoin mining

Gary: "I do also have to mention, if you're in them fortunately, I worry about them afterwards, the froth is starting to pick up again. I think I mentioned that Friday."

"Just remember, they can go up for a time, eventually they all go back to where they came from."

"By the way, a lot of them dropped 50-60% in the last two, three months, but they're bouncing them again. As we're getting back a little bit of froth into the market here as we start the new year."

📈 "LEFT SCREEN" (Lesser Tech) Better

Gary: "Remember on Friday I said my left screen, my left screen, that would be the lesser tech, which was so bad on Friday, much better today."

"Could be that tax loss selling may be over, not sure. But pretty decent move out of some names, but I've already been scanning them. And it's just a lot of bear market rallies."

📊 OTHER MARKET DETAILS

YIELDS:

• Down today
• 10-year: Closed 4.165
• Gary: "I don't want to see it go above 4.2. And by the way, every time it hits 4.2, it gets kicked in the teeth, and that's good. A break below 4.1 would be nice to see."

BREADTH:

• Advanced declines: "Pretty good"
• New highs: "Picked up, of course they're going to pick up"

AREAS OF NOTE:

• Metals, semiconductors (not all), financials, banks, regionals, SNLs
• Gold, silver
• Better day for weaker tech (but probably bear market rallies)
• Economically sensitive better

EARNINGS:

• This week: "Nothing of import"
• "Starts up late next week, and then for three weeks, boom, boom, boom"

Gary's Key Quotes

On Financials/Banks: "Market ain't going down, if that's the case."

"When the banks are going to new high ground, and regional banks even better... very little chance of the market croaking."

"Financials, very strong, very strong."

On Gold/Silver Bulls: "I get a lot of people emailing me on the moves in gold and silver, and they say... oh, that's going to be really bearish for the stock market soon. If it is, well, no, it hasn't happened yet."

On the S&P: "S&P is still... in the 10th week of range. Simple as that. Has not moved at all."

On NVIDIA: "NVIDIA is basically now range bound since August."

On Mega Caps: "I do want to give it the due that the mega caps are holding back."

On Crypto: "I'd like to say a type of low is in on the crypto for whatever reason. We never know why this thing goes up or down. It's crypto."

On Metals: "I have no edge. Today it gapped up. Two days ago it gapped down. The day before that it gapped up, the day before that it gapped down. I don't have an answer for you."

On Froth: "The froth is starting to pick up again... they can go up for a time, eventually they all go back to where they came from."

"A lot of them dropped 50-60% in the last two, three months, but they're bouncing them again."

On Oil: "Why [are oil prices up], with all this oil potential? I have no answer, I have no clue. How's that for a good answer? I don't have an answer why. It is what it is."

On Lesser Tech: "Much better today. Could be that tax loss selling may be over, not sure. But pretty decent move out of some names, but I've already been scanning them. And it's just a lot of bear market rallies."

What to Watch

CRITICAL LEVELS:

• 10-year yield: 4.2% is the line
• S&P: Still in 10-week range, needs breakout
• NVIDIA: Range bound since August (185-212-188 pattern)

KEY DIVERGENCES:

• Banks strong, mega cap tech weak/range bound
• Big oil up, explorers down
• Semiconductors mixed (group up, leaders down)
• Froth bouncing after 50-60% crashes

SECTOR ROTATION:

• Financials leading
• Semis (as a group) strong
• Mega cap tech holding back indices
• "Lesser tech" having bear market rallies (tax loss selling over?)

Bottom Line: Second big gap up to start the year, but indices remain range bound (S&P 10 weeks!). Banks screaming higher = "market ain't going down." Mega caps (especially NVIDIA) stuck in range since August. Froth speculative stocks bouncing after 50-60% crashes. Gary has "no edge" on metals, "no answer" on oil strength.