Earnings season has started. Wall Street is bullish on the first phase of President Trump’s trade deal with China. The stock market is near highs after rising for a decade. At a time like this, it’s important to pay attention to the other side of the story.
Here’s the key question for technology investors: “Should you buy, add, sell, trim or even short-sell specific technology stocks now?”
The best tool to answer the question is to look at segmented money flows.
Momentum crowd money flows are extremely positive in Apple’s shares. This is a big turn. Momentum crowd money flows have not been consistently extremely positive in Apple for a long time. (The momentum crowd consists of individual investors chasing growth stocks.) There is also a big turn in momentum crowd money flows in shares of Amazon, Netflix and Nvidia to very positive.
MacDailyNews Take: Momo is a gogo until it’s a nono.
More investors are buying Microsoft than Apple because Wall Street loves THE CLOUD. Microsoft will likely leave Apple in the dust based on Wall Street’s belief that any cloud business has unlimited growth potential. Apple doesn’t have anything that comes close to having unlimited growth potential. Microsoft has true momentum with no call for pullbacks or corrections. Microsoft was never affected by their failed mobile venture. It’s just that some companies are favored over others based on faith or investor confidence. Netflix stock explodes despite imminent major streaming competition with far deeper pockets. Go figure as to why Apple is doomed and Netflix isn’t. That makes no sense, at all.
I think it makes sense if you recognize that Wall Street “creates” competition, as it sees fit– if Apple had been valued correctly compared to its partners all along, it would have overshadowed them so completely that most investors would have starved the other companies, perhaps out of existence. Wall Street basically has allowed the field a way to play catch-up to some degree and they get to profit from the churn that comes from all of this. It’s in Wall Street’s best interest to create friction, they profit from it regardless of who wins.