Market Rebounds But Are We Out Of The Woods? Alnylam, CrowdStrike, Oracle In Focus.

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0:26Good afternoon, everyone, and welcome to Stock Market Today for Monday, October 13th. It's Alexis Garcia here. And stocks surged today after Trump appeared to tamp down some of his tariff talk towards China. This action, of course, coming on the heels of a pretty ugly day in the market on Friday. So I think the question on investors' minds is, are we out of the woods yet? And luckily here with me to help answer that and break down today's trading action is IBD Markets Research Director Justin Nielsen. So, Justin, what's on tap for us today?

1:05Alexis Garcia:Well, we're definitely going to talk a little bit about the market, maybe go over a recent precedent to kind of remind folks of what could potentially happen here. But we also have a few stocks that we'll talk about that were looking interesting today, including Al Nilem, CrowdStrike and Oracle. And I just want to tell the audience, Justin and I both separately watched the same video on how to pronounce Al Nilem just to make sure. And look at how good we're doing. Look at how good we're doing. We're nailing it today. So, okay, well, we'll get to those stocks in just a moment and test that pronunciation.

1:37But first, let's check in on the major indexes. The S &P finishing the day up 1.6%, the Dow up 1.3%, the NASDAQ up 2.2%, and small caps leading the day up 2.8%. So, Justin, let me get my shared screen going here. But again, talk to me about what you're seeing in the market, because Friday was not a good day. But coming back today, we're here on the S &P 500 after this ugly downside reversal just at this 21-day line.

2:12Alexis Garcia:Yeah. So the big thing here is when you have such a bad break, and look, it's news related, right? So just as the news can kind of tank your market, it can kind of bring life back to it just as easily. But a lot of times that kind of break in the market does tend to require a little bit of time. A lot of the base case scenario is that you go sideways for a little bit, that it gets choppy. Now, the ugly situation is that, you know, things really kind of start falling apart. But again, the what mostly happens is there's at least sideways action. Now, in a few rare cases, you do get a recovery and it's kind of like, oh, this is just one of those things I'm going to put my thumb over.

2:52Alexis Garcia:No harm, no foul. And it's not going to bother me for the rest of my time. So I think right now, one of the places that I'd like to look just as a recent precedent here for this, something we were talking about on IBT Live today, is if you pull up the NASDAQ composite and if we go just kind of look at December, December 18th. Now, this was news related as well. A lot of folks were and this is going to be December 18th, 2024. So, yeah, we'll do that. And yeah, looks kind of similar, right? This was a, you know, kind of a Fed shift. You know, we had had the 50 basis point rate cut back in September and there was a little concern of what was going to go on with tariffs and the inflationary effect.

3:41Alexis Garcia:And so there was kind of a shift in the Fed and boom, lo and behold, we really kind of had a really rough day, looked very similar to Friday. So what happened after that? Let's just go out a few months. If you click the down arrow, you can just kind of go out a few months. Yeah, let's let's go out like, you know, to February, February 21st, in fact, would be a great day. So you have this sideways action. And then you had another one of those days on February 21st, right, where you were kind of cruising along. You weren't quite as extended like we were in December, trending as nicely. But you had another day.

4:17Alexis Garcia:And this one crossed below the 50-day moving average line. And then you can go back to the current action. What happened after February 21st? Well, that was kind of a, you know, top. And we had the tariff tantrum, if you will, in March and April. and then the follow through day on April 22nd. And it was off to the races. So look, we just might have to have a little bit of sideways action here. I like that we kind of got into if you if you took Friday's action and said, OK, where's the midpoint? I like that we got to the midpoint. That's positive. But this is still a major inside day. It's really hard for me to get super excited.

4:56Alexis Garcia:I think the jury's still out because, look, just as we had news come out to the positive side, there can be some negotiations back and forth here that can kind of toss you to and fro. So I think it's just a time to be careful right now and not necessarily go with your full leveraged bets and so gung ho, a little bit more cautious. And that's where I'm at. I'm not completely in cash, but I'm not completely fully invested either. It's a little bit of playing the fence right now. Yeah, going in with both eyes open. Let's just quickly check in on the Dow, because again, this one, not. So exactly reclaiming the 21-day line here.

5:34And then small caps, again, a nice move today coming back above that short-term moving average.

5:40Alexis Garcia:And I will say that it's interesting that the Russell 2000, you know, again, if you look at Friday's range, this is well beyond that midpoint. It's definitely in the upper part. So I think that's kind of a nice thing. Now, normally we would say, oh, well, if we're going to look at the small caps, let's look at the 10-year Treasury yield. But the bond market was closed today. So what are we going to look at the 10-year Treasury yield for? You know, a lot of times that does close on Columbus Day. So not anything to see there, not anything to, you know, suggest a movement in the small caps because of bond markets since it was closed.

6:14And let's check out RSP. This one up about 1 % today, still below that 50-day line, Justin. But again, market breadth has been a little bit of a concern here. Your RSP has been lagging compared to the Qs. So any thoughts here?

6:31Alexis Garcia:Yeah. And as a reminder, the RSP is the equal weighted S &P 500. So this is kind of when you take out that heavy market cap that the trillion dollar club like NVIDIA and Microsoft and so on have, this is kind of treating everything equally. And look, this is below the 50 day moving average line still. So and again, if you look at that midpoint, this is kind of in the lower part. So a little bit of a struggle there, something to just be aware of and watch. Yeah, let's look at QQEW really quickly before we move on. That's the NASDAQ 100 equal weighted ETF. This went up about 1.6 % today at that 21-day line.

7:12Alexis Garcia:A little bit better here, you know, with that being closer to the midpoint. And yeah, back to the 21-day moving average line, as you mentioned. So, again, it tells you that, OK, for the S &P 500, those 500 stocks, not necessarily broad participation there. But if you just look at the NASDAQ 100, which is very technology focused, a lot more strength there. All right. Well, let's move on to some sector ETFs, starting with FFTY. That's the IBD 50 ETF. This one, a gain of 3.9 percent today. Yeah, one of the interesting things right now is that FFTY, as much as we talk about this as kind of a substitute for looking at what growth is, or I guess a proxy for growth, there's a lot of gold stocks in there right now.

7:57Alexis Garcia:It just so happens that relative strength-wise, a lot of those has kind of drifted to the top of the list here on the IBD50. But, you know, it has its growth names. What I like about the action here today is that here again, we're in the top half of the range of Friday. So that's a little bit of a positive there. And speaking of gold, Justin, you did a great analysis last week on IBD Live, taking a look at some gold names, silver, platinum. So if you're interested in seeing any of that, we did pull that clip for people to watch if you're interested in the gold trade. But let's go ahead and look at GLD, Justin, and get your analysis here up 2.4 % today.

8:37And I mean, just really looking almost extended here or as expected.

8:43Alexis Garcia:Yeah, exactly. I mean, it's, again, it's so funny because you just normally wouldn't expect in a major trending market with all of these speculative stocks doing well, your big cap stocks doing well, technology doing well. Gold, you usually think of as that kind of hedge and everything like that, a flight to safety. But here we are. That correlation has not been sticking with this market. We've had gold really, you know, skyrocketing. And even on Friday, this did pretty well. And again, that's a little bit more to be expected on a down day. But gold miners, if you pull up GDX, gold miners, you know, closed well at the bottom of their range.

9:25Alexis Garcia:It was flat. Gold miners had a little bit better action today. So it's interesting to see, again, the gold miners recovering almost back to highs and gold way up there, you know, as you said, pretty extended. And let's look at NLR. That's the uranium and nuclear ETF. This one, a gain of 5.9 % today, Justin. And again, strong action after this ugly downside reversal on Friday. Yeah. So despite the downside reversal, it's interesting that this got right back up there to highs. Now, you've had, you know, you still have a lot of the components in the energy, whether it's your physical uranium. That was something that Scott Sinclair talked about today.

10:06Alexis Garcia:The Sprott's physical uranium, S-R-U-U-F. You can't pull that up on market surge. There's the miners like CCJ. I do have a position there. And then there's Bloom Energy, BE, that had a spectacular day today. You know, that was up over 25 percent after already being up so much and, you know, making people, you know, feel like, oh, I missed this one. Oh, well, how about if I go up another 25 percent? And I did see in the comments that there's a few of a few of our folks that are watching that have that one. So congratulations to you. Yeah, so NLR, look, it's still there's a lot of these, you know, speculative names, the quantum computing names that are still doing very well.

10:44Alexis Garcia:So I thought it was interesting. Again, you know, I'm always looking at on a day where you have such a bad break. What, you know, on that day, I was looking at things that were closing closer to the top of the range. Today, I was doing the same thing. What's closing at the top of its ranges today and what things are making new highs? So NLR did kind of stick out to me, the fact that it's already, you know, never mind the midpoint of Friday's range, this is already at the top of the range and surpassing it. And let's move on to chips, Justin. That's SMH. This one, again, a 4.4 percent today. Yeah, another one in that top of the range.

11:22Alexis Garcia:Again, if you looked at a midpoint for Friday's action, definitely in the upper part there. So a lot of strength there. TSM, one to kind of take a look at. Taiwan Semiconductor. This has earnings coming up, but look at this. It's kind of like, again, if you put your thumb over that, it's kind of like no harm, no foul. It came right down to the 21-day moving average line. And now today, back above 300 and back above Friday's high already. So that's pretty impressive. And let's take a look at XLP. That's consumer staples, Justin. And this one, a loss of 0.4 % today. And when you look at some of the other areas of strength here, that's clearly not one of them.

12:01Alexis Garcia:Yes, well, that's kind of what you want, right? You saw this one doing well on Friday because what happens when people are scared? They go run to the staples, right? It's, I'm gonna buy my Coca-Cola, I'm gonna buy the Clorox, the things that people are gonna be buying, you know, no matter what, Procter & Gamble, all of those things. So that's where people tend to run for safety. So on a day where you have strength, it's nice that this was one of the areas that was down. So that was kind of a positive. One more area just to be looking at is IBIT, you know, the Bitcoin. There was a lot of kind of weird action, not necessarily in Bitcoin itself, but in some of the alternative coins.

12:42Alexis Garcia:So something to just be aware of this weekend was a little bit wild in that regard. IBIT coming down to its 50 day moving average line, seeming to get support, but definitely those altcoins, something strange brewing for this Halloween season. Well, we'll keep an eye on that one. But let's go ahead and take a look at some individual stocks.

13:32Starting with Alnylam, that's ticker A-L-N-Y. Now, this is a biotech play, Justin. This one up just short of 1 % today, but retaking or a more powerful move above this 21-day line here.

13:47Alexis Garcia:Yes, and look at what happened here. It just basically went flat. It had this really strong move in July and August. and then it just didn't move. In fact, let's take a look at the weekly chart and you can just see how, what it did was this 10-week moving average line was at such a steep angle and it went flat and just let that 10-week line catch up to it. So a very interesting look here. This was actually our stock of the day today. I believe Kit Norton was the one writing about that, talking about the RNA interference and everything that this has going for it. And as a reminder, look, When you look at the Biomed Biotech group, which is number seven out of 197 right now, so it's a very strong group.

14:31Alexis Garcia:A lot of our Growth 250 names are in this area. A lot of our IBD Live watchlist names are in this area. If you look at XBI, that's been an area of strength recently, kind of surging. So the Biomed Biotech area is very interesting. But looking back at Alnylam, one of the things that does set this apart, most of the, you know, the biotechs, they don't have earnings. Some of them don't even have revenue, you know, because they're they're very speculative. They're just, you know, a phase three trial away from complete disaster. Right. So this one actually does have revenue. You can see some really solid gains here in its revenue.

15:09Alexis Garcia:And it's not a small amount. It's not like, oh, one million. This is, you know, 700 million in the last quarter. So well above, you know, well in the top range of the the biomed biotech. And you can see that this is something that did have losses going back on the annual side. But the estimate is for it to be turning a profit this year. So this is something where a lot of these biomed biotechs are very speculative. They don't have fundamentals. This one looks like it's kind of turned in the corner in that regard. So not only do you have that fundamental side working for it, but now you've got a chart as well where you can really kind of limit your risk because, look, if this goes below this tight area, it's going to look a little broken.

15:54Alexis Garcia:Not necessarily like it can't come back, but there's a very easy way for you to limit your risk on this by just using that line that you just did, Alexis. So a lot of potential for growth and a way to limit your risk. That's exactly what we're looking for in our asymmetric trades. And we see this accumulation distribution rating of A minus, Justin, showing that you've got some big buyers coming into this name. So good to see there along with the technical and fundamental action. Let's take a look at CrowdStrike, CRWD, the ticker there. I'll switch back to the daily here, Justin. This went up a little over 3 % today.

16:30and right at this 507.20 cup with handle buy point.

16:35Alexis Garcia:Yeah, so I mean, this one for as ugly as Friday looked, this just doesn't look bad, right? I mean, when you were showing the weekly chart, I'm like, that's like a non-event. It just doesn't show up. It looks like a very normal week. So again, the things that have held up the best, those are the most interesting to me. This has come from a cup with handle. And look, I know it had, I got that blue screen of I couldn't do anything when CrowdStrike had its issues a while back and, you know, a four hour delay in getting my work started. But it seems to have really kind of recovered from that. You had that very deep correction and now it just seems to be getting tighter and tighter.

17:17Alexis Garcia:And this last handle that got tacked onto this cup, 8 % in the handle, really nice and tight. And it kept tight, even given Friday's action. So that's a plus to me. This definitely has the fundamental chops. You know, the EPS rating is an 82. You know, the revenue has, you know, been solid in terms of double digit above 20 percent. Earnings a little bit spotty lately, you know, probably some, you know, some recovery still in process. But again, the chart pattern is really attractive here and that relative strength line trending nicely above its moving average lines. All right. Well, let's hop on over to Oracle to wrap things up.

17:59Justin, that's ticker O-R-C-L, up over 5 % today and climbing above this 300 level. Yeah.

18:08Alexis Garcia:So there was there was some positive news here. You had you had news affecting, you know, Oracle, Broadcom, a number of a number of stocks. But what's most important here is, again, this recovery. You know, this is already when you look at Friday's action, this is already getting above Friday's high today. and not just that, but it's kind of looking like it's about to break this downtrend that it had. We had a strong gap up, really a pullback. And I'll be honest, I was trying a few of these because I was thinking, oh, it's starting to go, it's starting to go. But right now we're back above 300.

18:45Alexis Garcia:This looks like it could get another try here. All right, Justin. Well, thank you so much for your insights today. And as always, you're the IBD hostess with the mostest. Did you call me a hostess? Hostess with the most. Yes, I did. OK, just checking. Host with the most. Host with the most. I don't want to cause any problems here. Why don't you go ahead and give you a little preview for what you have cooking this week? Yeah, so we've got tomorrow, we've got our swing trader status update. So that'll be great. Mike and I do plan on going through not just that December 18th, 2024 precedent, but a lot more precedence because, look, the fact is the jury's still out on how we recover here.

19:29Alexis Garcia:We're going to need a few more days to see, hey, do we snap right back? Because sometimes that happens. Or do we need to have a little bit of time here? So Mike and I will cover that tomorrow on our Swing Trader Status Update at 2 p.m. Pacific. On Wednesday, we're going to bring back Viva Jha on the podcast. She really has this TQQQ strategy that she's refined. and she's going to talk a little bit about the mindset too that helps her trade that leveraged ETF with quite a bit of size and how she can get comfortable with that. She's going to talk about the science and the art and then for those of you that are on IBD Live, if you haven't gotten a trial there, investors.com slash IBD Live, do check out Brian Shannon.

20:10Alexis Garcia:Brian Shannon, of course, is the creator of the Anchored VWAP and he's going to be on IBD Live on Friday. It's always a great and amazing how well that, you know, that anchored VWAP works in terms of finding areas of support. So he's going to be on IBD Live on Friday. All right. Well, a lot to look forward there. Look forward to there, Justin. And thank you again for all your great insights today. Well, that wraps it up for this episode of Stock Market Today. But you can tune in tomorrow morning for more market analysis starting with IBD Live, you can head over to investors.com slash IBD Live for all the details there.

20:50And we'll see you right back here tomorrow.

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