Power Plays Weekly Roundup 

June 2, 2023

By Scott Redler

Welcome to this week's Round Up.

First, if you didn't see the earlier email alert, you should be aware that we took off half of Tesla (TSLA) and Apple (AAPL) earlier this morning. Both have had impressive rallies this week but it's time to tap the brakes a bit.

Right now, I'm watching to see if we get a rotation from tech, which has massively outperformed.

QQQ was up +7.9% in May vs. +0.5% for SPY and -3.4% for DIA.

Year-to-date, QQQ is up +33.4% with SPY +11.7% and DIA +1.5%.

To play the possible rotation, I selected XBI and Boeing (BA) as Power Plays Thursday.

Both look strong from a technical perspective so they have good potential either way.

As far as news goes, on Friday, we had a very strong jobs report which makes it hard to call for a recession, though it could keep the Fed hawkish.

Near-term, I'd keep an eye on the semis like Nvidia (NVDA) and AMD (AMD). If they sell of a bit without taking down the market, that could be a sign this bullish active sequence continues.

The big lesson this week was to look for setups instead of calling tops.

If you followed the headlines instead of the price action, you could have been caught short or sold longs too early.

That's why we are price action first.

Now let's go over our Power Plays:

Tesla (TSLA): Tesla has been a monster this week and got into my resistance zone faster than I anticipated. However, it feels a bit overbought so it probably needs some time to digest.

Apple (AAPL): There's been some talk that Apple is behind in AI but nobody told the stock because it looks ready to attack the all-time highs around $183. Still, the prudent move was to take something off today because we don't want to get caught flat-footed.

XBI: We added XBI as a Power Play on Thursday because I think we could start to see some rotation out of tech and into other growth areas like biotech. It showed some relative weakness on Friday but I still expect this sector to be a leader in the weeks ahead.

Boeing (BA): The stock had a decent gap up Friday after the CEO said aircraft maker will be constrained for years due to demand from airlines. Like XBI, I think BA could be a beneficiary of a rotation out of tech, so watch for this stock to be a leader in the weeks ahead.

Have a great weekend!


Scott Redler Positions Disclosure as of 2023-06-02 at 10.42.57 AM