HOW TO MAKE MONEY IN STOCKS

Stock Market Update:

Saturday, Jan. 16, 2021

David Saito-Chung, deputy markets editor

Investors.com, Leaderboard, IBD Live;

Co-writer, “The Big Picture” column

Twitter: @IBD_DChung, @SaitoChung

Email: david.chung@investors.com

Jan. 15, 2021:

Still a positive environment Feb. 24, 2020 – “Uptrend under pressure”

Feb. 25 – “Market in correction”

April 2 – “Market in confirmed uptrend”

Sept. 8 – “Uptrend under pressure”

Sept. 23 – “Market in correction”

Sept. 30 – “Market in confirmed uptrend”

Nov. 4 – “Market in confirmed uptrend”

A Day 4 Follow-Through By the Dow

• A follow-through day (FTD) is seen in

every major stock market bottom going

back to 1900.

• Some FTDs prove to be fakeouts.

• One key William O’Neil Rule: Buy at

least one security on the FTD.

• Top stocks also break out on the FTD or

just days afterward.

A Day 4 Follow-Through By the Dow

• From the Nov. 4, 2020, Big Picture:

Dow Jones Today: Up 10% Since FTD

Still A “Living With Coronavirus Rally”

• The market is pricing in news, both good and bad.

• Investors continue to accumulate shares in new

innovators: UPST, PYPL, AAPL, CRWD, FND.

• Economic data is mixed and may stay choppy,

reflecting a struggle among states to reopen large

parts of the economy. But the “reflation trade” is on.

• Bank, solar, retail, auto and chip sectors are leaders

so far in 2021. Oil stocks are rebounding on a rise by

crude oil back above $50. Utility, homebuilding, food

and select construction shares are lagging amid a

strong rebound in long-term interest rates.

“Living With Coronavirus Rally”

• The IPO market: Still robust. Solar energy tracking

equipment firm ARRY is still one to watch. IPO at

$22/share on Thursday; finished Friday at 45. Others

to watch: ABNB, ASAN, DASH, ESTC, MRNA, NIO,

PINS, PLTR, SNOW

• Will Bitcoin take a break? GBTC dropped 16% in

heavy turnover on Jan. 11.

• Select China, Emerging Market Stocks: Acting like

growth leaders – MELI, STNE, PAGS, TTM, PDD,

TME, JD, DQ have posted strong gains since Q4 of

2020.

Equities Vs. Bonds

Earnings Yield Of Large-Cap Stocks

Still Beats Long-Dated U.S. Treasuries 3-month T-bills: 0.11%

10-year Treasury: 1.11%

30-year Treasury: 1.85%

S&P 500 earnings yield: 4.4%

($167.71 2021 EPS Wall Street forecast from

Yardeni Research, divided by Friday’s closing

price of 3768 x 100)

Stock Market Update

David Saito-Chung, deputy markets editor

IBD Weekly and Investors.com

Twitter: @IBD_Dchung, @SaitoChung

Email: david.chung@investors.com

HOW TO MAKE MONEY IN STOCKS