10 Monster Stock Market Predictions – Week Of January 4

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The news flow will really pick up this first week of 2021, with a ton of economic data. This week alone, we will get all the ISM data, ADP Jobs, and Non-Farm Payroll. The data will suggest that the economy slowed in December; just how much it slowed is the concern.

S&P 500

The S&P 500 (SPY) had no cares throughout much of 2020 about the economy or anything, for that matter. It managed to close at a record on Friday, 3,756. But did the index finally break out? Remember, during the week, I noted that while the S&P futures managed to surge to a new high, it wasn’t until late in the day on Friday that the S&P 500 ETF (SPY) hit a new high, confirmed the S&P futures move up.

Notice the big surge higher in the final 10-minutes when it was revealed there was near $6 billion worth of equities to buy on the closing cross, a huge sum. It sent everything surging and pushing the SPY above those previous highs. It leaves me to wonder if the big advance will stick when we come back to work on Monday.

The big question is what the Russell and the most shorted stocks are trying to tell us. As the S&P 500 races higher, the most shorted and Russell have been heading lower and diverging. Is this the start of something, or just a blip? This will be one area of focus this week.

Tesla 

Tesla (TSLAreleased better than estimated fourth quarter delivery numbers, coming in at 499,550. The number was a big beat over what investors were looking for, around 482,000.

The stock managed to break above resistance on Friday at $695, which should now support it. I have been targeting $730 for Tesla since it broke out above $500 in the middle of November. It is pretty close already, but it may get one more boost higher this week before consolidating some.

Game Stop

Game Stop (GME) is down about 16% since I first noted it was in a squeeze higher. I don’t care what happens to this stock over the long-term, but surely the stock was very overextended over the short-term.

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Disclosure: Mott Capital Management, LLC is a registered investment adviser. Information ...

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