1-18-2025 - Weekly Stock Market Recap

Stock Market Summary: Week of January 18, 2025
This week's recap is presented by Mike Pair Money Investments and Biddles Investment Group.

Summary

Options Trading and Risk Management

The meeting emphasized caution when trading options, particularly for beginners. Risks associated with strategies like naked puts were highlighted, with a recommendation to explore options courses that focus on buying long calls and selling premium. Participants were encouraged to start small, paper trade, and build their confidence before using real funds. Technical analysis was prioritized during the session, with a top-down approach to reviewing indices, sectors, and individual stocks.

Market Trends and Sector Performance

Major indices, including the Dow, Nasdaq, Russell, and S&P 500, all closed higher for the week, led by strong performances from the Dow and Nasdaq. The VIX (fear index) declined, signaling reduced market volatility. Within the S&P 500, financials and technology were the strongest sectors, with materials, communications, energy, and consumer discretionary also showing notable movements.

Stock Performance and Government Impact

Key stocks, including Apple, Amazon, Google, Meta, Microsoft, Netflix, Nvidia, Tesla, and Broadcom, were analyzed. Many were observed trending sideways or downward, with some experiencing price drops. The group discussed potential regulatory impacts, such as executive orders, tariffs, and drug price negotiations, on specific sectors. Beverage companies and healthcare stocks were assessed for potential headwinds, including regulatory actions targeting sugar consumption and drug pricing reforms.

Stock Catalysts and Buying Opportunities

Several stocks were discussed for potential catalysts and investment opportunities:

• Pepsi: Facing an FTC lawsuit over price gouging.

• IonQ: Positioned for growth with upcoming events, including a "Quantum Day" catalyst.

• Chevron (CVX): Demonstrating strong momentum and fundamentals.

• Target: Rebounded from a sharp drop, offering a potential buy at $127.

• Intuit: Impacted by competition concerns but identified as a buy at $604.

• United Rentals (URI): Volatility following an acquisition announcement, with long-term growth potential.

• Palantir: Seen as speculative but promising due to AI-related ambitions.

Drone Companies and Trading Techniques

Emerging opportunities in the drone sector were noted, with stocks like Joby and Archer gaining attention. The group analyzed trading techniques, such as scaling into positions at key support levels. Stocks across sectors, including tech, energy, retail, and aerospace, were evaluated for buying opportunities.

Bitcoin and Market Analysis

Bitcoin adoption by banks was discussed in the context of a new executive order. Bitcoin was highlighted as a deflationary asset and potential inflation hedge. Other stocks, such as Bridge Investment Holdings, Boston Scientific, and CarGurus, were reviewed for their recovery potential.

Analyzing Stocks and Patterns

Technical patterns such as support/resistance levels, cup-and-handle formations, and bounce opportunities were analyzed. Energy stocks were evaluated for potential gains from increased drilling policies, while retail and tech stocks presented additional trading opportunities.

Trading Strategies and Chart Analysis

Technical indicators like RSI, CCI, and MACD were used to identify trades and inverse ETFs for bearish conditions. Spreadsheet tools helped filter stocks and evaluate trade setups. Participants focused on refining their watchlists and resetting tools for improved analysis.

Investment Performance and Strategy Updates

Trading performance from the previous year was reviewed, with strategies updated for 2025. Momentum trading strategies using technical screeners were introduced to align trades with market trends. Plans for creating tutorial videos on advanced trading systems were discussed.

Portfolio Management and Strategy Enhancements

Portfolio management strategies emphasized reducing losses, locking in profits, and avoiding wash sales. Scaling into trades and using stop-loss orders were advised to manage risk. Discussions included enhancing tools for stock research and creating alerts for actionable opportunities.

Stock Analysis Tool Development

The group discussed enhancing stock analysis tools with improved indicators and visualizations. Ideas for creating a mobile or desktop app with alert functionalities were explored, along with a dashboard for comprehensive stock research. Progress was made toward developing an advanced trading system.