• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Bruce Kamich
    • Doug Kass
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing
  3. / Stocks

The Indices May Need a Rest, but Interest in Stock Picking Is Building

In particular, there are fresh pockets of speculative action, thanks in part to Donald Trump's connection with SPAC Digital World Acquisition Corp.
By JAMES "REV SHARK" DEPORRE
Oct 22, 2021 | 07:25 AM EDT
Stocks quotes in this article: SNAP, INTC, FB, GOOGL, IBM, DWAC

The S&P 500 is up seven days in a row and is sitting near resistance at all-time highs. This is an obvious technical setup for a pullback or consolidation. There even is an obvious news catalyst in the form of poor reactions to earnings from Snap Inc. (SNAP) and Intel (INTC) that is creating some sympathetic pressure in a few other names such as Facebook (FB) and Google (GOOGL) .

Is it time to worry? Has the market become too frothy after a big run?

The likelihood at this juncture is that there will be more rotational action under the surface. Some big-cap names may impact the indices like IBM (IBM) did Thursday to the Dow Jones Industrial Average, but it is important to focus on the underlying action and not just the indices and the news coverage we see in the business media.

The strong move over the past week has created very good support and a supply of dip-buyers. Many market participants failed to put much money to work and they will be inclined to buy dips aggressively. One of the primary reasons that the market has gone straight up over the past week is that dip-buyers are too impatient to even wait for dips to develop. They fear missing out, and that is driving the trading.

Another favorable aspect of the market currently is the pockets of speculative action. There was a huge surge in Bitcoin and related stocks that created much retail interest, and then Thursday there was absolute craziness as the Trump SPAC play, Digital World Acquisition (DWAC) , jumped five-fold and raged more than 40 points higher in late trading.

This is the best special purpose acquisition company action in a long time, and it has renewed retail interest in trying to find the next name that may make a big move. Traders are already speculating about other stocks that have large short interests or thin floats.

While the technical conditions of the indices are problematic and sectors such as social media and chips are under pressure, the good news is that individual stock picking is not only healthy but picking up steam. When we combine that development with earnings season and positive fourth-quarter seasonality, it looks promising for active traders.

The indices are slightly soft here on Friday morning, but they are already shrugging off the negative news.

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

At the time of publication, Rev Shark had no positions in the stocks mentioned.

TAGS: Investing | Stocks | Media | Semiconductors & Semiconductor Equipment | Real Money

More from Stocks

If You Like Roller Coaster Rides, You've Gotta Love the Russell 2000

Jonathan Heller
May 16, 2022 10:30 AM EDT

The small-cap index has been a poster child for market volatility this year, though the current period isn't as wild as back in 2008.

SoFi Technologies Is Primed for a Rebound

Bruce Kamich
May 16, 2022 8:50 AM EDT

Here's where the shares may be headed next.

Don't Worry About Capitulation but Focus on How the Market Wind Is Blowing

Bob Byrne
May 16, 2022 8:17 AM EDT

If you're a short-term trader, try to identify which way the market is trying to auction.

My Review of Indicators Points the Way to a Tradable Rally

Bruce Kamich
May 16, 2022 7:58 AM EDT

Keep in mind that this is not a buy-and-hold recommendation but rather a path to producing modest gains over the next few weeks.

Worries About a Potential Recession Are Building

James "Rev Shark" DePorre
May 16, 2022 7:39 AM EDT

For now, this is a bear market, and strength cannot be trusted.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 07:14 PM EDT PAUL PRICE

    A New, Very Scary Movie

  • 08:51 AM EDT PAUL PRICE

    Advice From the Future...

  • 12:20 PM EDT PAUL PRICE

    A Blast From the Past Regarding Bitcoin

  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2022 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login