Stocks Rebound In Day Two Reaction To Fed; AMD, Moderna, SpaceX In Focus

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0:35Ed Carson:Good afternoon, everyone, and welcome to Stock Market Today for Thursday, September 17th. It's Alyssa Coram along with Ed Carson here and a strong day two reaction to the Fed rate hike and the Nasdaq in particular in a pretty notable position. Technically speaking, Ed, what say you? Yeah, we'll see what happens next. But there were a few stocks that looked pretty good today AMD, Moderna, and SpaceX. All right, we'll get to those stocks. But first, let's take a look at the major indexes. Like I said, powerful gains across the board here. But the NASDAQ, I want to start with that, Ed. The tech-heavy index up 1.7 % today, clearing a little trend line here from the last couple of weeks.

1:28Ed Carson:More progress we'd like to see, of course. Meanwhile, the S &P 500 was up 1.1 % on the day, just when you thought the S &P was really on the ropes there, Ed. Now still trying to fight around some key technical levels. The Dow is in a weaker position here, was up 0.6 % on the day, but still weak in comparison below a number of the moving averages there. Same can be said for the Russell 2000. Here's a look at small caps and a weak close on the day for the Russell, Ed, up just a half a percent. So what do you make of the action here? Clearly, it's not all systems go across the board for the major indexes, but pretty compelling to see the move that the NASDAQ made today.

2:17Yeah. And even yesterday's action was pretty good because it came off lows when the whole market was coming off. It barely fell and tried to hug that 50-day line. Today got above there, got above the 21-day line, broke that mini trend line. Look, we'd love to see higher highs. Of course, strength seems to beget weakness over the last few months. And so it's really tricky. Where do you get in? Where do you get out? There were stocks slashing buy signals. But yeah, this was making a nice move. I like the fact that there was that day two reaction to the Fed and it wasn't clear. And somewhat, we're sort of moving past Monday's drop where we had those AI slowdown fears.

2:59I wouldn't say that's entirely in the past. And there can always be another headline that changes things around on a whole bunch of stuff. But yeah, it was encouraging. It's just a question about, you probably want to be kind of one of those things where it's one of those days where you test the waters a little bit. Because what if this is the move? You don't want to be out in the cold when it really moves up. But at the same time, there have been enough head fakes that you don't want to be just like jumping into the deep end either. So yeah, it was an encouraging day, especially on the NASDAQ.

3:29The NASDAQ definitely looks the best out of these indexes.

3:32Ed Carson:It really does. So hopefully next stop will be that downside reversal high. That's where we want to see it clear. in addition to the marked high. And it seems, and, you know, there's a high before that, that we'd like to see that as I get above. We have all of these levels, right? And those are levels incrementally to continue to add exposure. I agree, Ed. I think today was a day to dip the toe back in the water and traders, especially active growth investors, maybe getting too aggressive on the last couple of big moves up that we've seen recently have gotten burned. And we definitely don't want to see that.

4:15Ed Carson:So like you said, being aware of risk management and position size, momentum from here would be great. We want to get out of this choppy range. Could this finally be that catalyst that we've needed? I think in addition, like you said, seeing stocks that are actionable, right? We want to have merchandise to buy as we're seeing the index get in gear. So let's see if the positive action can continue. And I do, while we're looking at the NASDAQ composite, just want to give the NASDAQ 100 a shout out here. It's a QQQ up 1.7 % on the day, also retaking some moving averages, but not out of the woods here by any means.

4:59No, no. But again, these are the best looking things out there. But yeah, real encouraging on this front. And I also, and we'll look at the sector ETFs, but there seemed to be a number of different parts of techs that were doing well. I mean, the sector rotation has been so tough, you know, but this time it felt like a lot of things were moving up today. So that was also encouraging.

5:21Ed Carson:Yes. Okay, let's take a look at the S &P 500. Here's the SPY ETF. Didn't have quite as strong of a close as the NASDAQ yesterday, as you mentioned in reaction to the Fed news, but it did rally pretty notably today here up 1.1%. Got back above that 760 area that we've been keeping a very close eye on the 50-day. It's right at the 21-day. Let's take our little track price tool here. So, yeah, closing essentially right at the 21-day, Ed. So, it wouldn't take much to see this back at highs. We're just 2.1 % off of highs at this point. Yeah, and a lot of the financials aren't doing particularly well.

6:05I mean, energy was fine today. But, you know, some of these things, you know, and Exxonfet didn't have a terrible day today, but obviously it's had a tough run. Energy didn't do a whole lot. So, there were a lot of sectors that were just like, eh, didn't do a whole lot today. And so, in that sense, there's a lot of those names in the S &P. the fact that the S &P was still able to go up more than 1%, retake a key level. So that was a positive. So not everything, you know, there was breadth out there, but it wasn't like this overwhelming where everything was going up. So, yeah, look, I mean, if we can just increment it, you just can't get too excited or too worried about the nitpicking on the one day.

6:43It's like if the S &P continues to trend higher, nobody's going to be that concerned that we only rose, that we aren't way above levels. That will come. But, yeah, there are areas that weren't as strong today.

6:57Ed Carson:Okay, well, while we're looking at the S &P in some of these sectors, let's also take a look at the RRSP because this has been an area of concern for us, Ed. This is the equated S &P 500 ETF and a measure of breadth. So while it did rebound today up about a half a percent, this isn't flashing a notable buy signal in and of itself. I'm not saying that it has to for other parts of the market to perform well, but just something that we're keeping an eye on, you know, sort of a pulse on the average stock. Yeah, once you get past the NASDAQ and the S &P, you look at RSP, you look at the Dow, you look at the small caps, they're all showing the same kind of, there's work to be done.

7:42I mean, this was, you know, nice that they're up, but an IWM did not have a good close, as you say. I mean, these things are hitting resistance at 10-day lines or 8-day lines, you know, whatever, and just not showing the power. These would not really be encouraging days. I mean, it would be nice that they'd bear up. But if we were looking at these, if these were all the indexes we had, we're like, we need to see some more before we feel any kind of real sense of getting involved.

8:08Ed Carson:Exactly. Well, let's take a look at the 10-year ed. what is this telling us and in light of the fed raising rates yesterday what should we be thinking about here yeah i mean this is coming down a little bit i mean and it was actually i got to like 502 overnight you know or like so it came down a fair amount but uh we're just down to a short-term level so we'll see i mean we have not breaking that very steep uptrend yet so we'll just have to see how things go also note that the 10-year to two-year yield spread is the narrowest since like March 2025, which is one reason why the financials are struggling.

8:49The rates are high, so nobody wants to borrow. And then the banks aren't going to make money off of those things because the spread isn't very good. So that's not a good combination. I mean, there's other factors out there, but that's one reason why the financials are struggling. Yeah, we need to see this come down a lot more. But this is a big reason why the market rallied, the stocks rallied today. And you could argue, again, given how the yields have risen so much and oil has risen so much in the last few weeks, the fact that the stock market held up at all was really resilient. It was like these hands really pushing down on that balloon.

9:20And it's just like, if you could get that off and oil came well off lowest, that could have killed this market rally. I was worried about that. It's like, oh boy, oil was almost positive and it was down below. It closed just a little bit. It was down 3 % at one point and barely fell today. But yeah, if you could get those to come down, that could be the real trigger. But that's one of the issues. What happens if another pipeline blows up or something? You know, all the great technical action in the world, if oil drop surges another 20%, well, you know, that's going to happen. I mean, so we're still dependent a lot on these oil and treasury yields for sure.

9:59Ed Carson:This episode is brought to you by Hard Lessons, a podcast from Morgan Stanley. Some investing lessons only become clear after you see how a call plays out. On Hard Lessons, iconic investors sit down with Morgan Stanley leaders to go behind the scenes on the critical moments, both successes and setbacks, that shaped who they are today. Watch or listen to Hard Lessons wherever you get your podcasts.

10:24Ed Carson:Continuing to keep a close watch. Well, let's take a look at some tech-related themes of note. You mentioned the chips. This was a strong area of outperformance on the day, up 2.8 percent. Still some work to be done here. But if the momentum can continue, you know, maybe we can get a close back above the 50-day line and the highs from a couple of days ago. You know, when you have an up day like this, there is always that chance, you know. But we definitely want to see some rounding out of this base that the sector is forming. There are some standouts underneath the surface. this one that we'll get to.

11:03Ed Carson:But by and large, this is not the red hot sector still that it once was. Yeah, it's still a potential. This could be a short. I mean, this could come right up again. And that the 50 day line is really important. And even the standouts, they could easily fall apart. If the chip sector overall falls apart, it's going to be real hard for those chips and AI hardware. And a lot of them were showing interesting action today. Yeah. So they're still recovering from that Monday tumble on, oh, we're going to have an AI slowdown. The market seems to be moving past that, but the fact is SMH is still down for the week.

11:38Ed Carson:Okay, moving on, we want to take a look at the software sector. So here's IGV representing the broader sector, up 0.8 % on the day, and then the cyber ETF-CIBR, that is, up 1.4%, and this area looking even better in software. Yeah, and IGV does have plenty of cybersecurity, and that seemed to be working. There were some names that were down, the more traditional names, for whatever reason. But when you look at the leaders, there were a number of leaders that showed strength. Cyber is a way to play it, honestly, because there's a lot of, you know, that's, a lot of them are acting like this. They're either at highs or near highs, rebounding off the 50-day line.

12:17So, something like that. So, definitely, this is one of the stronger areas. And despite the ups and downs, this has had plenty of ups and downs, but at least it's been trending out. It makes a world of difference as opposed to the indexes, which have been up and down and sort of trending lower. Higher highs and higher lows, much better than the opposite. And so this has been a real area of strength. Yeah.

12:43Ed Carson:And I think because of that, using the 50-day moving average or the 10-week as your stop seems like a good idea because as of now, it's definitely showing the personality that it likes to pull back to that level. So, you know, obviously you can keep positions small and tight stops tighter. But, you know, if you're going to keep it tighter, you might get whipped out of this one if the personality continues. But we'll see. Yeah. And let's go to the medical sector, specifically biotech. Here's XBI up 2.6 % on the day. So also a nice day of outperformance for biotech stocks. We did see a close off highs, but it seems like there was a lot of attention on this area on IBD Live today.

13:33Ed Carson:So a good group to keep tabs on. Yeah. And this might be, especially if it could maybe get to yesterday, today's highs, that might be a place you could try to enter again. One way to play it, uh obviously there is um there's arc g uh arc invest genomics thing there are some you look at the names in there they had some really hot names uh they've nailed it right now i mean this the the stocks that are in that are the big big holdings in this are just on fire uh that is a huge move this one has been finding you know don't forget about the 50 day lately but really a huge move over the last several months honestly uh so yeah within there there can be strength but there are a lot of names, whether it's testing, genomics, or some biotechs that are profitable, or revenue generating, development stage.

14:20There's a lot of interesting names out there in the biotech genomics space.

14:25Ed Carson:Yeah, good to know. And I think one way to think about these ETF moves as well is not only can you play the group that way, but you can also take a look at the top holdings, or all the holdings as a way to research, hey, well, you know, if this group is hot, I want to find the leaders, the real top tier leaders within the group. Maybe that's one way you can also do some research. So looking at it both ways as an exposure play and a research tool. That's great. Let's go to XME, the metals and mining ETF. Kind of all over the place lately, Ed, but another strong performance performer today from this group.

15:07Yeah. And there were some stocks, you know, like some of the gold plays, some of the copper plays, they did better. I mean, to be honest, there were some names that were some flashing some buy signals or getting back to buy from the FCX, which is a copper and gold play. That was at least intraday flirting with back. I mean, all over the place, all over the place. But, you know, in some broader sense, I'm just trying to show that there were some leading groups that are not that they were all sort of moving in the right direction today. Yes.

15:35Ed Carson:Yes. A good data point there. Okay. Taking a look at a couple of stocks of note from today's session. Here's AMD from the chip sector. Full disclosure, I do own this one. Shares were up 6.4 % on the day and actionable. Was this our stock of the day today or yesterday? I think it was yesterday. It was yesterday. And it faded off yesterday, but even then, it was clearly high in the range. And that's happened with a lot of stocks today. There were some stocks that faded, but you look at them, they're high in their weekly range. Yeah, this one cleared that area. So I think this one definitely, you know, this was a day to be buying if you're going to be doing it.

16:16You could have done it yesterday, too, as it was getting near there, sort of breaking a downturn to that. You know, this one's been holding up better. We'll see. That didn't save some names that were leading the chip sector like a month ago, and then they fell apart. So it's not like, this is the leader. I can't ever sell this. No, no, this goes below your sell rules. You've got to do that. But showing strength here, RS line coming up. The fundamentals look great. So, yeah, this one's a leader in a group. If the chips do take off, this one is probably going to be off to the races and will be too late to get into it.

16:50But nice action today.

16:52Ed Carson:Absolutely. And I agree. I like the fundamentals to triple digit bottom line growth in the most recent quarter. It's no 13 ,000 percent, but 250 percent, not too shabby. I also, I want to show everyone a cool tool. I know this will slow down things a little bit, but I want to show AMD versus the sector. So I want to go to SMH. So here's a look at AMD versus the S &P 500. Now let's show the strength versus the chip group. so let's see that look the the rs is leading it's at new highs before the price so this is also a tool that we use to show that group leadership so amd definitely has that i also really like even though the rs line did weaken in that july august period held up so much better than a lot of the other chip names so uh which i think is also why you're seeing the rs line doing what it is now, right?

17:59Ed Carson:So underscoring that leadership from a price strength perspective as well. So a little tip there for our market surge users. I like that. I often use that when I'm looking at energy stocks, when they might be counter trend, like, okay, well, this one's holding out the best, or maybe some defensive sectors that are starting to come on. If you're looking in there. It's like, well, wait, you know. So, yeah, that can be a very useful tool. Good stuff, Ed. Let's go to Moderna. We've been tracking this one very closely ever since it had that huge move on news a couple of weeks ago. Then it went really tight, I guess at least comparatively.

18:45Ed Carson:It still has a pretty high ATR, but we'll see what happens when that big day drops off. But this was a signal, right? If you weren't buying that upside reversal, which we know Webby on the team was, he was there at that upside reversal, I guess that was last week. Today, with it clearing this little flag area, getting above 150, this was actionable here, Ed. Yeah, I like the 150 because there's also those last few days were right there, could get in there. Yeah, I mean, the ATR is probably going to drop down to eight or nine, and maybe even less than that pretty soon. Until yesterday, this was actually on track to get a three-weeks height.

19:25I mean, oddly enough, despite its ATR, it's not going to now, obviously, and even yesterday it was maybe going to, but it was trading pretty tightly, especially as we're getting on. So this was great. I mean, to have that explosive move. I mean, this is really, it was so nice to have this come on because normally a stock does this and then it's going to whip around and yeah, you're in it, you're fine, you're up so much. but if you're not in it, how the heck do you get into it? Yes, some people did and they got shaken out because it was really violent for a few days. But even then, but now, okay, it tightened up, tightened up and now moving out, clearly getting above some resistant levels.

20:00There's excitement on this one. The growth presumably will return going forward. There's a lot of possibilities here that really make it really impressive. So we'll see. But yeah, I think today was a nice day to be getting into this.

20:18Ed Carson:And IABD's senior market strategist, Mike Webster, has shared that IABD founder, Bill O 'Neill, has looked at two weeks tight, or he did, once upon a time, look at two weeks tight in a base. So it didn't get the three weeks, but it did have the two weeks there, Ed, and moving out. We definitely want to see the momentum continue here. And we'll be watching to see if it can hold that 150 level, I think. And of course, it seems like the 21-day would be another level to watch. Though, how far is it above that on a closing basis? It's getting up there. It's already 18 % above that level. So in terms of managing risk, it seems like you would want to probably just use a percent stop or today's low, depending on your trading style there.

21:10Ed Carson:Okay, let's go to SpaceX, another notable mover from today's session, up 2.6%. And we know that even though SpaceX is newly public, it is a very large publicly traded company, to say the least here. Ed, give us the update on what's going on with SpaceX. Yeah, and just some news is that they actually had what could have been seen as negative news. They delayed their SpaceX Starship flight. And this was the first one that's supposedly revenue generated. They're going to put real satellites in real orbit is the plan as opposed to, you know, some other stuff. So that is a big deal. That's going to be pushed back about a week or so.

21:50So not next week, the week after that. If you look just on the right side of the base, ever since it bottomed, I really am liking the action. You know, the volume wasn't like always tremendous, but it was at the beginning of that rebound. That's fine of that. But also I like how it's hugged the 21-day line. It's become calmer. It's a little bit calmer in that sense. I mean, it's an IPO. It's not calm, okay? And the market's choppy, so I don't want to overplay it. But nice action. I like today, you know, it sort of, it got over$190,$49.80. You could have gotten shaken out of that, but then today, I think, either breaking the downtrend, it's flirting with$155, which is sort of like the real short-term high.

22:26So that could be a place, because it is low in the base, there is a lot of trading to$150 to$170. I think just in that area, yet because there's a lot of trading there obviously it goes all the way up to 225 or so but a lot of trading early on was in that 150 170 or so so that is one thing when you have a breakout you want to be breaking out it's sort of like a football player breaking out into the open field there's nobody to stop then this one it feels like there's still people like there's stuff you know they're sort of grabbing at you maybe so it's not a as i say break it out into marshmallow you can get through it maybe but it's not you know and so that's it like so that makes it a little bit more aggressive this is why we talk about wanting to have stocks in the upper half of the ranges of things so we do early entries like that but there's a lot of things going on there's the xai the revenue growth because they're selling their excess computing power so the revenue growth is going to be tremendous maybe it's going to turn profitable uh nasdaq 100 is going to be adding more weight adding the weight to it's already been in the nasdaq 100 but because those float has happened And now that they've unlocked some more shares, the NASDAQ will now add the weighting a little bit to it.

23:35So that's a few billion dollars more of institutional money that's coming in. That's probably another factor. So, yeah. So I think it's right here at the 155 area is definitely buyable. Just know what's going on. Probably the 21-day line or something else would be a place you could get out, you know, somewhere in that area. What is that about? Like, yeah, trade is about.