The Twitter-and-Elon Musk saga has finally come to an end, as the eccentric billionaire has completed a $44 billion acquisition of the struggling social media company.
The stock will be delisted from the New York Stock Exchange today.
How great it is that we can change our minds and take decisive action immediately?
As traders in the financial markets, if our spidey senses detect that something is amiss or conditions have changed, we can often liquidate our positions and head safely into cash with just a few keystrokes on our computer. Depending on the size of our positions, we can be completely in cash within minutes, maybe even seconds!
You can’t do that with Real Estate.
You certainly can’t do that with Private Equity investments.
You definitely can’t do that with a small business.
All of those investments are fine for their own reasons. But they don’t offer us the opportunity to immediately exit if we change our minds.
Of course, just because we can change our minds on a dime doesn’t mean we always should. If we’re wishy-washy and trading without a plan, it becomes incredibly easy to overtrade and drive our commission bills and nerves through the roof. While this might make us popular at our broker’s office, our accountants will unlikely be pleased.
There are stocks going up and there are stocks going down.
I'm old enough to remember when we would all call that normal.
The going up category just got longer recently. Remember Energy had been the only Sector Index above its 200 day moving average.
Healthcare is now also on that list.
Industrials and Consumer Staples are the next closest ones.
This morning we talked about how poorly the Tech heavy Emerging Markets were doing vs those like Brazil, Saudi Arabia and Indonesia, that have a much different composition.
That doesn’t mean it’s time to go all in. Tactically, it’s difficult to get behind this week’s near-term strength.
Right now, we’re looking at just a few days of bullish price action. And where do we define our risk?
We have to know where we’re right and where we're wrong before we get involved in any investment.
Thankfully, high-yield bonds answer this all-important question.
Check out the daily chart of the High-Yield Bond ETF $HYG:
Unlike most bonds, HYG has formed a small reversal formation.
We like the looks of this 4-week inverted head-and-shoulders on the HYG chart. Momentum is improving. And the bulls are reclaiming a key level of former support turned resistance marked by its...