Weekly Watchlist Jan 26
Tariffs and more tariffs...
Welcome back to another Weekly Trade Plan with The Dividend Journal! If this is your first time here, great timing. This newsletter is your one stop briefing to stay ahead of the market and step into the week fully prepared.
I hope everyone is enjoying their extended weekend :)
🎯 Initial Thoughts + TLDR
Last week was filled with volatility as tariff threats related to Greenland lead to a sharp sell off in the beginning of the week. The US then backed out of the tariffs as negotiations on Greenland progressed. This led to a mid week recovery, which reversed all the losses made on January 20.
Meanwhile, in all this uncertainty, metals including Gold and Silver continued to surge to new ATHs. This shows many market participants are fearful and still creating a flight to safety environment amongst the uncertainty.
And in other news, the US government is expected to invest over $1.6 billion into USAR 0.00%↑. This would give the US government a 10% stake in the company. USAR 0.00%↑’s market cap as of Friday close sits at $3.66 billion, so this investment is absolutely huge. Rare earths are a critical resource used in a variety of products like defense systems, EV motors, semiconductors, and wind turbines. China currently dominates the processing and sale of these materials.
Investing into USAR 0.00%↑ shows that the US government wants to rely less on China for rare earths and wants more control over this resource. The company has no revenue yet, but this massive investment is likely to help jump start production and construction hurdles.
We also enter earnings season this week with giants like META 0.00%↑, MSFT 0.00%↑, AAPL 0.00%↑, and TSLA 0.00%↑ reporting (amongst other large companies). We’ll have more earnings the next week as well. These can all be catalysts for either the next leg up or leg down. This will all depend on guidance for the rest of the year.
📅 Key Earnings & Economic Calendar
Monday, January 26: Durable Goods
Tuesday, January 27: ADP Weekly Employment Change
Wednesday, January 28: FOMC
Thursday, January 29: Unemployment Claims
Friday, January 30: PPI
Earnings this week, courtesy of Earnings Whispers:
📈 Market Update: As of Friday, Jan 23
SPY 0.00%↑: After the tariff threat, markets gapped down to the daily 50EMA. We proceeded to see another rubber band effect just like the previous three times where the US government rescinded the high tariff threat. The choppiness in the second year of the presidential cycle is currently playing out as expected, like we talked about last week.
If more actions and plans involve tariffs, we can likely expect continuous price action like this until that strategy subsides.
IWM 0.00%↑: Small caps actually saw a pretty aggressive sell day this past Friday that brings us right to the daily 9EMA. The rotation was clear as SPY 0.00%↑ and QQQ 0.00%↑ closed higher Friday. Large cap tech stocks finally got some love, which was due for some buying as we approach earnings season.
Bitcoin: We’ve now seen a pretty ugly rejection and failed breakout off of that 94k spot. Bitcoin is almost perfectly inverse trading metals like Gold and Silver now. Clearly, the flight to safety amongst many market participants is still the old standard of metals rather than defi. This perspective shows that Bitcoin is still a more risk on asset that will probably catch momentum when metals start to cool off. This is influenced more by what’s happening in the world than anything else. Until we get more certainty in politics and economies, metals will continue to grind up as that safety net.
🔍 What I’m Watching
