Ethereum (ETH) has outperformed Bitcoin (BTC)by a country mile in the last seven weeks, holding much closer to November rally highs. It’s pulled back just 19% since that time while the crypto king has relinquished nearly 29%. In addition, the decline has found support near the .382 Fibonacci retracement of the rally starting in September while BTC is struggling to hold the .786 retracement. And, unlike its rival, ETH hasn’t failed the breakout above the May high.
We’re headed into December triple witching options expiration, marking the last chance for fund managers to lock in 2021 gains (or losses) before heading out for the holidays. Expect volatility and two-sided action to surge, with growth, inflation, and Omicron competing for traders’ attention. The week could mark a good opportunity to think contrary and look for Peloton Interactive Inc. (PTON) to burn short sellers riding down a 61% six-week slide to a 19-month low.
Fedex Corp. (FDX) rallied above 2018 resistance in the 270s in November 2020 and failed the breakout 10 months later, entering a decline that tested the 200-day moving average successfully in September. It’s now bounced back to resistance at the 50-day moving average, just in time for Thursday’s after-hours report, when the shipping giant is expected to post a profit of $4.82 per-share on $22.4 billion in revenue. Look for the stock to make little progress after the news, with supply disruptions, inflation, and Omicron weighing on the holiday sales outlook.
iShares China Large Cap ETF (FXI) sold off to the .786 Fibonacci retracement level of the 2020 rally in July 2021 and has spent the last six months testing this support level, which has narrowly aligned with the 200-month moving average. This confluence predicts that bulls will ultimately prevail, ahead of a substantial rally wave that persists well into 2022. Relative strength indicators are flashing the same message, deeply oversold and trying to cross into buy signals.
Activision Blizzard Inc. (ATVI) has been crushed in 2021, dropping 37% in reaction to a poorly-handled sexual harassment scandal. CEO Bobbie Kotick faces widespread calls to resign but he continues to act like a Marvel villain, refusing to step down. Coca-Cola Co. (KO) could strip him of his Board membership soon while outraged employees are trying to unionize. All in all, this is perfect set-up for a profitable short squeeze when the CEO finally cleans out his desk.