The Nasdaq and S&P 500 are up big premarket Thursday while the Dow is down.
When you see divergence like this, it’s a big red flag that means there was likely a news event that was negative for the Dow but positive for the other indexes.
In this case, there was good overnight news for semiconductor stocks, and that was strong earnings for Taiwan Semiconductor Manufacturing (TSM).
But I would be very cautious here because the Nasdaq 100 (QQQ) can huff and puff, but the overall broad market has to take things higher.
The bond market (TLT) is also still breaking down, and there’s a strong correlation here between stocks falling along with bonds. There may be a couple of days where they diverge but for the most part, they’re pretty in tune.
Bonds are a major issue for the stock market right now, and if bonds are going down, that means interest rates are going up. And if rates are going up, that’s bad for stocks, tech stocks especially.
So while earnings may push things up for a couple of days, look out below!
We also have plenty more big earnings reports to come and some big Federal Reserve reports to come this week…
I’ll cover all that and more in this morning’s “Premarket Must Watch” video!
In today’s all-new briefing…
I’ll discuss why we have to watch tech very carefully… if the blue chip rally is behind us… which stocks are leading once again… hHow to navigate today’s earnings today… bond levels… and whether or not it’s time to short solar stocks.
Roger Scott
Roger Scott Trading
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P.S. This Large Cap Might Be About to Fill the Gap
There’s a major large-cap stock I’ve honed in on that could be about to fill the gap higher after selling off.
No, it’s not Tesla, Amazon or Nvidia…
I’ll be live at noon ET TODAY, Jan. 18, to give everyone this stock, along with an entry trigger and profit target for this setup.
I’ll also teach you how my brand-new swing trading strategy targets stocks that have tanked overnight because of bad news — these are stocks that have big double-digit rebound potential in short order!
Click on the link below and save your seat…
