Benzinga - by The Arora Report, Benzinga Contributor.
To gain an edge, this is what you need to know today.
Record Black Friday Please click here for a chart of SPDR S&P 500 ETF Trust (ARCA:SPY) which represents the benchmark stock market index S&P 500 (SPX).
Note the following:
- The chart shows that the stock market is levitating right under the mini resistance zone.
- If the stock market breaks above the mini resistance zone, the next target is the resistance zone shown on the chart.
- The consensus among permabulls is that in December the stock market will rocket to the resistance zone shown on the chart.
- In The Arora Report analysis, there is a reasonable probability that permabulls will be right, but it will depend upon the new data that is ahead.
- Prudent investors should consider being neither permabulls nor permabears but depending on the data.
- Supporting permabulls’ case is that consumers splurged on Black Friday. According to Adobe Analytics, consumers spent a record $9.8B online on Black Friday. This is 7.5% higher than last year.
- Overall, Black Friday sales rose 2.5% year-over-year according to Mastercard.
- How are consumers paying for the splurge? In addition to maxing out their credit cards, consumers are extensively using buy now pay later.
- Foot traffic in retail stores rose by 2.1% year-over-year.
- Various reports estimate foot traffic in stores rising by 2% - 5% year-over-year.
- The expectations are for Cyber Monday to generate about $12B of sales online. This estimate is over 5% higher compared to last year.
- Investors are rushing to buy stocks of Affirm Holdings Inc (NASDAQ: AFRM) and Shopify Inc (NYSE: SHOP). Affirm is a large provider of buy now pay later services. Shopify software runs a large number of e-commerce websites.
- Investor enthusiasm over the consumer borrowing more and spending record amounts is being tempered in the early trade by data from China.
- October Industrial Profits in China fell by 7.8% year-to-date. Initially, U.S. stock futures were lower on the data from China, but then buying came in on enthusiasm about consumers’ splurge.
- Liquidity in the stock market is low.
- As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band.
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Magnificent Seven Money FlowsApple IncAmazon.com, Inc.Microsoft CorpNVIDIA CorpTesla IncIn the early trade, money flows are negative in Alphabet Inc Class C (NASDAQ: GOOG) and Meta Platforms Inc (NASDAQ: META).
In the early trade, money flows are mixed in SPDR S&P 500 ETF Trust and Invesco QQQ Trust Series 1 (NASDAQ: QQQ).
Momo Crowd And Smart Money In Stocks The momo crowd is buying stocks in the early trade. Smart money is