JNJ Takes a Big Blow
Welcome back to the Rude Awakening for Tuesday, April 13, 2021.
We are seeing a bit of weakness once again this morning.
However, we have some news items pushing and pulling on the market, so we’ll see how the market responds throughout the day.
We do still have almost all of our indicators showing buys, although we are getting some overbought signals coming in, and our Stochastics are showing SELL for the first time in a long time.
This slightly mixed messaging speaks to the reality that we are at these fresh all time highs and the market is getting tired.
The two pieces of news causing a mixture in market sentiments are: the Johnson & Johnson’s vaccine being pulled out of circulation (bad) and Consumer Price Index numbers coming out not nearly as bad as expected (good!).
Inflation is the bugaboo on Wall Street right now, and the fear is that we are about to see higher levels of inflation, which would then affect monetary policy and increase interest rates.
But with the good news on CPI combating with the bad news of J&J’s vaccine, we are seeing a push/pull effect in the markets.
Potential Pairs Trade in Battling Vaccine Stocks
With this volatility, we as traders have some stocks to watch…
First up, of course, is Johnson & Johnson (NYSE: JNJ).
(Any time you have a stock in the news, you want to take a look at it.)
Just a few minutes into the open, it’s unsurprisingly already selling off in a big way. But going back in time to give us some perspective on JNJ, you can see some bearish trends just by looking at the chart.
We get into more details on its action and how to play it in today’s video.
JNJ juxtaposes with a major competitor, Moderna, Inc. (Nasdaq: MRNA). Looking at the MRNA chart, it’s just the opposite, with the stock shooting up this morning and showing a majorly bullish trend over the past year, even more so in the past few weeks.
And last for today, a stock to watch outside the health space… FedEx Corporation (NYSE: FDX).
This one offers a really interesting trading opportunity, given some bullish news that’s come out from analysts on FDX.
Have a great trading day, folks.
We’ll talk tomorrow!
Editor, Rude Awakening