Weekly Market Update 27 - 05 - 2022 - S&P 500 Ending a 7 week decline? Snapchat falls 40%, Live trading room update

May 27, 2022

Welcome to your Weekly Market Update

The oil markets have been trading in a tight range most of this week with an overall bullish bias.  We saw price moving between $112 and $108.50 before finally moving to the upside trying to test the $115 mark. With the war continuing we expect volatility to come back into the market, however at this time the risk of oil trading in a range is still high. We will look to keep our focus on oil in the Live Trading Room while taking trades only when we see volatility enter the market. We have been able to take a few trades this week but remain cautious. It is important to keep on top of risk management as we can expect these periods from time to time.

Chart of Oil prices.

A number of strong earnings results from the retail sector boosted market confidence, with all three major indices on track to close higher for the week.

The S&P 500 attempting to end its seven-week losing streak, the question on many investors minds is although we are not out of the woods with a potential recession looming due to major shifts in monetary policy, ‘are we seeing the bottom being hit on these stocks?’.

‘Is this the right moment to pile in’?

But with many stocks are still being caught within the firing line of aggressive short sellers we may have some new lows printed soon, Snapchat saw this as it declined as much as 43% as they expressed growth concerns. On the flip side, it seems as though this accelerated the stock to a low enough price to attract buyers. We will continue to monitor the stock to tailor our approach.

Chart of Snapchat Inc.

Tesla and Twitter have been moving wildly due to market sentiment around Elon Musk’s proposed take over of Twitter. Recently seeing Tesla shares shed 25% of its value in the past month alone.

The most recent chapter tells us that Elon Musk is no longer looking to fund the deal with a margin loan, this was seen as a positive for both Twitter and Tesla, with Tesla shares rallying 16% over Wednesday and Thursday and a further 2% higher in pre-market movements today. Twitter also jumped higher by 11.5%. But with prices of Twitter sitting at $39.52, it is still far below the $54.20 deal price, giving us an indication that investors aren’t yet sold that this is the final chapter in the story.

Chart of Twitter Inc.

Until the next week’s Market Updates…Have a great trading week!

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