Stocks Up, Paycom Breaks Out; Time To Buy This Bitcoin ETF Again?

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Stocks staged another broad advance in afternoon trading and the major indexes are set to cap another strong week with decent gains.

[ibd-display-video id=3037819 width=50 float=left autostart=true] Meanwhile, Bitcoin Investment Trust ( GBTC ) showed mettle, rebounding more than 12% and avoiding a potential collision course with its rapidly rising 50-day moving average. Volume is light, however, leaving the strength of the rebound somewhat suspect. The average daily volume over the past 50 sessions continues to rise, now at 139,000 shares.

The Bitcoin-tracking ETF slid hard four days in a row amid strength in equities across the globe, a sell-off in U.S. Treasury bonds, and reports that the South Korean government is considering a ban in cryptocurrency trading. But on Friday, authorities appeared to tone down the strong rhetoric.

At 2:30 p.m. ET, the Dow Jones industrial average, led by gains of 2 points or more by at least five of its 30 components, kept gains of more than 0.7%. At 25,776, the blue chip index was poised to rise nearly 1.9% for the week, on top of the prior week's 2.3% surge.

Dow Jones industrial stock JPMorgan Chase ( JPM ) padded its recent advance, rising 1% to 112 in heavy turnover following another quarter of steady top- and bottom-line growth.

JPMorgan is now up 17% since surpassing a 95.32 buy point in a base on base on Sept. 21, initially in dull volume. Strong turnover showed up over the next few weeks.

The S&P 500 and the Nasdaq rose around 0.6%. The S&P SmallCap 600 lagged a tad, up 0.3%. Volume is running virtually flat vs. the same time Thursday on both exchanges. Defensive stocks such as dairy, grains, meat, candy and water utilities declined.

Breadth continues to improve with advancing stocks exceeding decliners by a 9-to-5 ratio on the Nasdaq. On the NYSE, winners edged losers by around 100 issues.

JPMorgan posted an 8% gain in revenue to $38.12 billion, matching the 8%-9% gains seen in the prior three quarters. Adjusted earnings rose 3% to $1.62 a share, according to William O'Neil + Co., missing the consensus view by 7 cents. Net margin fell 220 basis points vs. a year ago to 21.8%.

Yet despite the year-over-year drop in after-tax margin, the Wall Street, commercial and consumer banking titan gave numerous signs that the economy is poised to continue growing. Average core loans rose 6% companywide vs. a year ago. In the Consumer & Community Banking unit, net revenue jumped 9.5% to $12.07 billion, leading to an 11.4% rise in net income to $2.63 billion.

Meanwhile, Bitcoin Investment is making its second test of the 10-week moving average (as seen on a weekly chart) since its Nov. 22 breakout from a deep cup with handle at 985.10. The first and second pullbacks to the 10-week line offer a good chance to either establish a new position or add shares to a winning primary position.

The bounce off the 10-week line this week near 1,713 has come in higher volume than the prior week, a good sign. But it's critical to try to buy shares as close as possible to the 10-week line. This is especially the case with Bitcoin Investment because its weekly price swings from low to high are ultra-extreme.

Over the past three weeks of trade, including this week, the swing from low to high has easily exceeded 10%.

Elsewhere, WTI crude oil futures rallied 0.6% to $64.19 a barrel, the highest level since December 2015, as energy, metal ores and mining related stocks have had a glorious second week of the trading year.

WTI near-term futures are now 6.5% year to date, slamming a 4.1% gain by the S&P 500. The Nasdaq composite, at 7255, is up 5.1%.

PetroChina ( PTR ), highlighted in a Stock Market Today column on Thursday, added 0.6% to 76.76 and is now just 6% below the 81.80 high within its gigantic saucer base pattern. The oil and gas integrated firm continues to pad its gains from an early breakout past an aggressive buy point at 72.10.

Caterpillar ( CAT ) is likely to finish an eighth straight week up. It offered a four-weeks-tight entry point at 140.54 during the week ended Dec. 1 last year. Notice how, after a strong run-up, the stock barely budged for weeks, moving sideways and holding on to its gains. Such action creates additional buy points such as the 3-weeks-tight and 4-weeks-tight.

Paycom Software ( PAYC ) broke out of a solid six-week flat base with an 86.20 buy point. Shares gained more than 3% to 87.99 in volume running double usual levels. The 5% buy zone goes up to 90.51.

The payroll and HR outsourcing software expert joined Leaderboard as the 11th company with strong potential to outperform the major indexes.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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