Power Plays Weekly Roundup + Taking Off Half XBI
January 13, 2023
By Scott Redler
Before we get started in the roundup, I want to take off half the XBI for Power Plays.
It's had a quick run-up and it's time to play it safe.
It was the busiest week in Power Plays in quite a while with 3 new ideas plus a bonus options idea in Pinterest (PINS).
As you know, the pace of ideas will ebb and flow with the overall environment. If the market is bearish, I do not want to throw ideas at you just for the sake of it.
Overall, the market feels a bit overbought now, so there's a push-pull to see if we can hold higher as some of the froth gets worked off.
For near-term sentiment, I'd keep an eye on Meta (META) and Tesla (TSLA) to see if they can hold their morning lows.
($134.84 for META, $115.60 for TSLA)
The banks will also be key over the next few days.
JP Morgan (JPM), Wells Fargo (WFC), and Blackrock (BLK) all reported today and they are all lower.
It's very common for banks to sink on earnings, and then resume rallying within a day or two.
So keep your eyes on those names. We want to see them on the stronger side.
But overall, it feels like the time to take the foot off the gas pedal.
We are still in a bearish environment and we'll be facing a ton of earnings news over the next few weeks.
Now let's go over our names:
SoFi Technologies (SOFI): I added SOFI because there's been a lot of insider buying (rare these days...) plus big potential for a January effect move. And just as I wrote that, it turned green! Hopefully, we'll see this continue.
XBI: Biotech's had a really nice start to the year, but it may be getting ahead of itself. In this market, it's easy to get punished for believing in rallies.
Occidental Petroleum (OXY): The energy sector has been perking up, and I always like to play OXY when oil is moving. The buying from Warren Buffett seems to give the stock a natural cushion, so I'm looking for some nice upside in the weeks ahead.
Enjoy your weekend, because you earned it!
And stay tuned for more updates next week.
Scott Redler Positions Disclosure as of 2023-01-13 at 9.50.22 AM