In today’s briefing:
- Tesla Motors Buy Level for Drive to 255
- EQD | ARK Innovation (ARKK US): Is It Time to Get Back into Growth?
- Bear Market Rally Continues; Financials/XLF Reversing YTD Downtrend; Small-Caps at 11-Month RS Highs
- DeFi Options Protocols Series (#3): Where Can the Next Phase of Growth Come From?
Tesla Motors Buy Level for Drive to 255
- TSLA (US) shows near term upside that is expected to fade and set up a better entry level below 200 with stiff resistance near the 255 target.
- Macro descending wedge is the dominant driver into 2023 with lower wedge support at 180/160 and upper pattern resistance at 330 currently and will shift lower with time translation.
- Buy volumes on this bounce have tapered off, suggesting this rise is corrective in nature and why our buy target revolves around a new low.
EQD | ARK Innovation (ARKK US): Is It Time to Get Back into Growth?
- Growth Stocks have been hammered in the rising rate environment
- Inflation may have peaked and central banks could be reaching the end of the hiking cycle
- We look at derivative strategies on ARKK US to gain a broad exposure to the growth and tech
Bear Market Rally Continues; Financials/XLF Reversing YTD Downtrend; Small-Caps at 11-Month RS Highs
- The market remains in bear market rally mode, and our price target remains the 200-day MAs on the SPX and Russell 2000, as discussed in last week’s Compass (Oct. 25).
- Longer-Term, this is still a bear market until the S&P 500 and IWM can break above their respective YTD downtrends/200-day MAs, and markets could easily test their lows again.
- With that said, there are signs that suggest breakouts above YTD downtrends/200-day MAs could be coming. Catalysts include the FOMC announcement on Wednesday, followed by midterm elections on Nov. 8.
DeFi Options Protocols Series (#3): Where Can the Next Phase of Growth Come From?
- DeFi options protocols’ TVL did not change much in the past three months despite the bear market we are now in.
- Many (TradFi) institutions and institutional investors we spoke to believed the next bull market/major innovations in DeFi might be coming from protocols that offer yields from real-world assets.
- To drive the next phase of growth, options protocols should leverage their composability to tap into it by offering those protocols additional use cases related to options.
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