Nasdaq Soars But Is It Enough? Apple, Celestica, Globus Medical In Focus

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0:25Good afternoon, everyone, and welcome to Stock Market Today for Monday, November 24th. It's Alexis Garcia here. And the major indexes kicked off the shortened Thanksgiving trading week with a big rally today. Tech stocks driving the gains on Wall Street. And here with me to help break down everything you need to know about today's trading action is IBD Market Research Director Justin Nielsen. So let's get Justin on here. No turkey today, Justin. Just a whole lot of green, I guess. We got our vegetables? I don't know. Yeah, I don't know. We'll make that work. But what do you have on tap for us today?

1:11Alexis Garcia:Man, there's so much that's moving. But yeah, the big question is going to be, is it enough? So we'll kind of give two sides to every story here. But we'll start out with Apple. Also talk a little bit about Celestica, up a huge amount today. And then also Globus Medical, because the medical stocks still looking very strong. All right, well, we'll get to those stocks. But first, let's just check in on the major indexes. The S &P 500 finishing the day up 1.6 percent, the Dow up half a percent, the NASDAQ up 2.7 percent, and small caps finishing the day up 1.9 percent. So, Justin, let me go ahead and get the charts going here.

1:51But talk to me about this market, because we had the indexes fall below the 50-day line. We had some big, ugly downside reversals last week, but today it looks like it's trying to get back above these key levels here.

2:09Alexis Garcia:Yeah, it is. It is trying to get back above both the 50 day and 21 day moving average lines are kind of base case. You at least got to be above there. And a lot of times in order for me to be even involved. But that Thursday, it was such a big, wide day. And again, it was only matched, strangely enough, by the October 10th day. Remember, that was when President Xi and President Trump, China, U.S., going at it a little bit. And we actually, you know, that was a really big spread. And actually, the spread that we had last Thursday was even larger. The high got above that high and the low got below that low of October 10th.

2:49Alexis Garcia:And that seems like until we get above Thursday's high, it's going to be very hard for me to get too excited by this market, especially right now. We're right at that critical level of the 50 and the 21 day moving average line. I mean, if this got turned away, if, you know, for the rest of the week, we kind of faded, that would be a really bad look. Um, so, and, and you could easily see that happening on the other case, you know, on the other hand, if this did start continuing and making further progress, once it gets above that Thursday high, it's going to be like, okay, well, it's, it's recovered from that ugliness.

3:24Alexis Garcia:Um, and you know, until then it's a little bit hard for me to go either way. Uh, I just don't feel like I have an edge right here. So, um, I'm, I'm remaining light myself, uh, just because I don't want to stick my neck out. And I should also say for swing trades, a lot of these swing trades, it's very hard to manage risk in a lot of these cases. We saw a great upside reversal on a lot of stocks, you know, the indexes as well on Friday, but they were so low in that Thursday range. Did you really want to stick your neck out? Because it just seemed like, especially in this market, we've had a lot of those upside reversals, they roll over and do just enough to shake you out and make a new low before you get another upside reversal.

4:11Alexis Garcia:So I've been playing that game here for the last month and a half, it feels like, and it has not been working well for me. Buying at the highs and selling at the lows, who knew that doesn't work in terms of getting your portfolio to go higher. So, you know, right now, again, I just need more evidence. And one of the big things I'm looking You know, it's that Thursday high. All right. Well, no, I mean, there's just been a lot of chop. It's been really difficult out there, Justin. I'm going to switch over to the NASDAQ because kind of the same story here, approaching these conjoined 50 and 21 day lines.

4:45But talk to me about what you've been seeing in tech. And again, we'll be looking at that Thursday high, as you mentioned, as maybe the next key level to get across.

4:54Alexis Garcia:Yeah, definitely. I mean, you know, tech has been coming on a little bit stronger. A lot of money moving back to the AI plays. But again, there was a lot of damage done too. So it's, again, one of those situations. You had some of the high flyers already in just this mild correction. They were already down 30, 40, 50 % or more, you know, like your OCLOS and things like that. So it's really tough when you've got that much damage to get too excited about 10 % moves when it's just, again, still only scratching the surface of the damage that was done. So here again, if we do cross some of these downtrends, which the Thursday high is kind of setting up a little area here where if you look at some of these, then you're saying, OK, well, gosh, if we just kind of draw a line from the 24 ,000 level on down, it does seem like that Thursday, you know, you have to cross that line, right?

5:53Alexis Garcia:And coming right up to it, even that is a little nerve wracking because just like we are at the moving average lines, if we get turned away there, you'll kind of kick yourself a little bit and say, oh, well, we came up to the line and got turned away. That's a sign of resistance. Why did I buy early? You know, on the other hand, if it goes through there, then it might be a little bit tough because things might be a little bit more extended than you want to buy. And again, it might be a little bit tougher to manage your risk in that way. So, yeah, it feels a little bit like a no man's land. And so it's not easy right now.

6:25Well, we'll be keeping an eye on that Thursday high, Justin. Let's just quickly check in on the Dow Jones. Again, this one, a gainer today, still below the 50-day line. But, you know, same with small caps trying to claw back some of these losses and get above those key moving averages.

6:44Alexis Garcia:Now, I will say for the Russell 2000, to its credit, on Friday, whereas most things were closing in the bottom of their ranges, from Thursday, this one did close in the top of Thursday's range. So that was a plus. It was up considerably. I mean, this was up much more than the other indexes being up 2.8%, but it was still an inside day, up that much and still an inside day. Now today, it looks like it did cross above the Thursday high, but there's also been more damage done here. So it's still, despite being up above that Thursday high, this is still below its 50-day moving average line. And, you know, that's an issue.

7:26Alexis Garcia:It's hard for me to get excited about buying stuff that's below the 50-day moving average line. If you can't be above that medium-term trend, how strong are you? But certainly the last couple days, you have seen a little bit of a boost in the relative strength. It did lag the NASDAQ composite today, you know, with just a 1.8 percent gain. I say just 1.8, like that's nothing. But yeah, it is in a better position in relation to its Thursday high, but in a worse position in relation to its 50-day moving average line. All right. Well, let's take a look at market breadth, Justin, because that was also down heading into the end of the week, also trying to recover here.

8:06So what are you seeing in terms of market participation?

8:10Alexis Garcia:Well, here again, it was kind of interesting how RSP looked strong in terms of where it closed in its Thursday's range on Friday. And again, looking good today. But gosh, when you look at 0.4 % versus the S &P 500 up one and a half percent, I mean, that's not great, right? So that means that the average stock was not doing nearly as much as the mega cap stock. So, I mean, if you look at FNGS, for instance, which is kind of your trillion dollar club of stocks. You know, this was up 3%. So this was where kind of the money is, but still not above Thursday's high, still not really decisively above the 50-day or the 21-day moving average line.

8:56Alexis Garcia:So yes, mega caps, and we're gonna talk about Apple in a little bit, but mega caps definitely seemed like it was getting a lot of the money. And advancers were still above decliners. I'm showing like 1 ,800 advancers versus 1 ,100 decliners on the New York Stock Exchange. And for the NASDAQ exchange, I was showing about a two-to-one ratio in favor of advancers over decliners with about 3 ,100 advancers and 1 ,500 decliners, according to Thinkorswim. So, you know, it's not like these were really poor, but they just did not, the average stock did not have quite the move. Now, QQEW was much stronger than RSP, the equal weighted S &P 500.

9:40Alexis Garcia:This was up 1.2 percent. But still, in relation to what the Qs did, certainly lagging quite a bit, you know, significantly. And then let's just check in on the 10-year Treasury yield, Justin, before we move on, because this had been taking up and trying, looked like it was holding up at 4.1 level, but falling over the last few days, down again, six-tenths of a percent today. Yeah. So, I mean, a lot of eyes are on the Fed, December 10th coming up. What's going to happen? We've seen a lot of volatility in what the expectations are for that meeting, whether or not there's going to be a rate cut, whether or not it's going to hold pat.

10:21Alexis Garcia:And remember, our last meeting, there were two dissents and they were opposite ways. One was like, hey, we shouldn't have cut. And one was saying we should have cut more. So it's, I think, a lot of uncertainty, you know, right now. I think a lot of investors are trying to get their footing. And that's increased the volatility. Let's just take a look at the VIX real quick. You know, this is known as the fear index. This has come down quite a bit from Thursday, but it's still, you know, it's still at an elevated level, you know, from where we've been lately, being above 20. So I'd kind of like to see this get a little bit less.

10:59Alexis Garcia:And more importantly, it's this intraday kind of volatility, the intra-week volatility, where you start one way and then you are completely the other direction later on in the week. So we've been talking about how, you know, even intraday, a lot of times you might start strong and finish weak. It's nice that in both of these days. We finished strong, both today and on Friday. But, you know, we'll see if that can continue. And again, those Thursday highs, can we get back above those? All right. Well, let's take a look at some sector ETFs. You talked about FNGS, but how about FFTY? That's the IBD 50 ETF.

11:39This went up over 4.5 % today, Justin, heading toward that 35 level. But again, still a ways to go before hitting this declining 21-day line and the 50-day line.

11:53Alexis Garcia:Yeah, and exactly. And you've got to remember that FFTY, it's rebalanced frequently. So there are a whole host of new names each week. You know, sometimes they stay pat, but when there's a lot of sector rotation, this does move into other areas very quickly. So it can be, you know, this can be very rough in terms of recovery. Sometimes it takes it a while to recovery because you need a trend of stocks in there that stay in there and continue going higher when it's volatile. The names can be volatile in terms of whether they're staying in there or not, a very high turnover ratio. And so just looking at the chart itself, it's got work to do just like everything else right now.

12:37Alexis Garcia:Also probably worth looking at IBIT because a lot of people have been pointing to IBIT or Bitcoin, I should say, in cryptocurrency as having a liquidity issue. And that's where that's what was kind of causing, you know, some of the market gyrations. And look, this was up considerably, up five and a half percent today. But again, look at the position. I mean, still so well below the 250. Below everything, you know, I mean, take your pick. You know, any level of support that you would have wanted this to have, it just like blew through it. And again, you know, let's go to the weekly real quick. Just as a reminder for folks, this is still 30 percent off its high.

13:18Alexis Garcia:You know, so up five and a half percent today and still 30 percent off its high. So it's got a lot of work to do. You know, as you mentioned, 200 day, 50 day. Take your pick. There's a lot of there's a lot of hurdles this has to cross. Oh, let's take a look at GLD, maybe less hurdles there. This one, again, had such a great run up until hitting this 403 high back here on October 20th. It pulled back, but it seems like it's trying to find its footing up about 1.6 % today, Justin, and really moving above this 21-day line. Yeah. So as a reminder for folks, you know, that know kind of some of our rules for the IBD methodology and have heard of things like the climax top, this was not a climax top.

14:04Alexis Garcia:It was definitely going at an angle that we're not used to for GLD. But usually we don't call a climax top that soon after a base. You know, it's after it's been an extended run that we start saying, OK, this this might be right for a climax top. You know, it certainly crossed levels. It was going higher than, you know, I mean, at a at a steeper angle, but too soon to be a climax top. And so, look, that just means, you know, it did need to take a break, which it has. I really like how tight it got right at its 21 day moving average line. So there's a lot of indications here that gold is, you know, potentially not done here.

14:42Alexis Garcia:And a way to play that is with GDX. If you want to go with the gold miners, you know, those those do tend to be a little bit more have a little bit more oomph over gold. You can see even today a 5.8 percent move for the gold miners. And yeah, this is something where despite that big move that it had earlier and and look, it came off pretty considerably. But I think this is still potentially setting up. So something to be keeping an eye on. All right. How about one more look at XLP? That's the Consumer Staples Spider ETF. This one down 1.2 % today, Justin. And again, you know, trying to build a base here, but well below the 250 day lines.

15:29Alexis Garcia:Well, and that's one of those things where you have to be very careful because staples are, you know, I mean, they can really suck you in, right? Because this is where a lot of the institutions go to hide when things start getting dicey and you start seeing the names really do well. But, you know, this got turned away at its 50 day moving average line. You know, as as tech starts sucking up more money, then where do people go? You know, the places where they hid, it immediately comes out of there. And I'm just going to point out one example here is Coca-Cola. K.O. This looked so strong on Friday.

16:05Alexis Garcia:And if you were like, well, gosh, you know, Coke is it. You know, here we go. It had a very volatile day. And look, it was it was down at one point. it was down like 1.5 % had lost all of the gains from Friday. It closed off its lows and in the upper part of the range, but still not the kind of volatility that you usually expect from one of the staples like Coca-Cola. Introducing Fidelity Trader Plus, the next generation of advanced trading from Fidelity. Customize your tools and charts and access them seamlessly across desktop web and mobile for faster trades anywhere you go. Try the all new Fidelity Trader Plus.

16:44Learn more about our most powerful trading platform yet at fidelity.com slash trader plus. Investing involves risk, including risk of loss. Fidelity Brokerage Services, LLC. Member NYSE SIPC. All right, well, let's take a look at some of the individual stocks, starting with Apple, that's ticker AAPL. This one, 1.6 % gain today, Justin. And looks like it's getting above some of these recent highs here.

17:13Alexis Garcia:Yeah, so we looked at FNGS, which Apple is a member of. And look, that's just getting above, getting back to its 50-day moving average line. But you have Apple and Alphabet as two of the strongest in this current market. I mean, Alphabet is out of there. It's gone. It's, you know, sayonara. But it's, you know, Apple was kind of, look, it had tightened up recently. This is actually something that can still be bought at this level. You had a nice uptick in volume both on Friday and today. So that was kind of nice. This is above its Thursday high. So it's checking off that box. It's already above its 50-day moving average line.

17:52Alexis Garcia:Didn't even cross below that since, you know, since August. And, you know, it got support at the 21-day moving average line. So in a very different position from some of the other FNGS members, let's, I'm looking at you, Meta. So Meta was up a lot today, but is in such a weaker position, having, you know, plummeted through its 200-day moving average line. You've got that 50-day moving average line looking like it's going to cross below that 200-day moving average line, you know, anytime now. So, yeah, this was up, you know, 3%, but it's in such a horrible position. I'd much rather go for an Apple that's in a better position or retroactively by Google if I could.

18:34So you're looking at this Thursday high then as a potential entry point? Yeah.

18:38Alexis Garcia:And then we crossed above it today. All right. Let's go ahead and look at Celestica then, Justin. That's ticker CLS. This went up over 15 percent today and again, just powerfully rebounding off of this 50-day line. So thoughts here. Yeah. The thought is, what do you do with it? You know, it's up 15%. So if, you know, if you bought it today, you're still not above Thursday's high. So you kind of haven't, you know, even gotten above there. You are above your 50 and your 21 day moving average line, but that Thursday high is still looming for this one. You're up 15%. So let's say you, you know, you go to put in a stop, where do you put that in?

19:19Alexis Garcia:I mean, you could easily see this coming all the way back down to the 50 day moving average line. You know, and so you set a stop there, that's a lot, you know, that's a lot to lose on a potential trade. So this is the problem with a lot of stocks out there right now, especially the heat that did so well since April through, you know, through October. Now these have come off quite a bit. And, you know, some of these, they're more volatile. The ATR, the average true range is much higher for these. And, you know, it's really tough to kind of figure out how do you get into something like this and manage your risk.

19:55Alexis Garcia:And for me, this was just one that I had to skip because I'm not going to be buying it as it gets above the 21-day moving average line and look at a, you know, 10 % or more loss. Even if you use the 50-day moving average line as a stop loss, you could easily say, well, gosh, you know, there's the low of Friday, you know, why not use that? Well, now there's another 5%. So exactly how much would you let this come in? And if you use something that was too tight, because the stock is so volatile, you could easily see it knocking out those stops. So it's always a balancing act. You know, if you make your stop too tight, you're more likely to get shaken out.

20:33Alexis Garcia:You make it too loose. And if it doesn't work, you're taking on a bigger risk. You, you know, you take a bigger hit when you're wrong. And that's more difficult to recover from. So if you did want to play something like this, that's more volatile. One way to do it is with smaller position sizes. So you're managing your risk to your portfolio, even though you might take a big hit on the trade percentage. You know, if you're doing a smaller position size, that's going to limit the risk to your portfolio. But the biggest issue, and again, this is why I skipped this one today for myself, is again, how do you manage that risk?

21:12Alexis Garcia:How do you get the asymmetric trade in your favor. Sure, I could see this easily going up another 40 points to the highs that it made at 363 just a few weeks ago. But I could also just as easily see this, coming down below the lows of Friday. And then that makes it a little bit more 50-50 for me. So I want to get something more in my favor on the upside. Yeah, particularly in this market, Justin, let's take a look at one more ticker GMED. That's Globus Medical. This one breaking above a 87.16 by point today, up 2.2 percent. Yeah. So, you know, medical, again, is still very strong. This was breaking out of just a cup with handle.

21:55Alexis Garcia:But one of the things that's interesting is we had that big gap up on the earnings move. So how much were we up on that day? Up an incredible amount. Almost 36 percent. 36 percent. it didn't give up any, you know, I mean, hardly any, right? It had that big move, didn't even cross below 80, the low of that gap up day, you know, whatever. People were just very, very comfortable with it at this higher valuation. And so now it's broken above that downtrend. We don't have to worry about Thursday highs here. That got clobbered on Friday and it's breaking out of a cup with handle. So tight action, very interesting looking to me.

22:34Alexis Garcia:Another one I'm going to put in this same kind of caliber as Illumina, ILMN. So we'll consider this a bonus stock. You know, this one also, ILMN, yeah, this one also had a big gap up on its earnings, really tight action and, you know, looking strong like it's ready to come out of that tight action recently. Both Illumina and GMED, you can see kind of a volume change. You know, they've had some nice volume coming in. I would say GMED is a little bit better in that regard, both on the volume side and on the fundamental side. It's just got some stronger numbers in the last few quarters in terms of both the top line and bottom line growth.

23:15Alexis Garcia:So this is my favorite one, but yeah, they both look good. And I should say GMED also landed on leaderboard today. Apple landed on Swing Trader. So these are some of the stocks that we're watching. All right, Justin. And Will, thank you so much for your insights today. And that wraps it up for this edition of Stock Market Today. If you want more market analysis, be sure to tune in tomorrow morning, starting with IBD Live. You can head on over to investors.com slash IBD Live for all the details there. And thank you so much for watching. We'll see you right back here tomorrow after the close.