Hey, Ross here:
Welcome back to a new week.
It’s still a bit too early to tell…
But it looks like the mega SpaceX IPO may have indeed ended the pullback.
Now, some will say that it’s a sign of “too much hype” instead.
And while I agree that the SpaceX IPO itself was overhyped…
The broader market itself is looking much less frothy than most think.
Let’s take a look.
Chart of the Day
Both the S&P 500 and the Nasdaq are still below recent highs.
And yet, the Equal-Weight S&P 500 has already reclaimed new highs…
Which is a great sign for market breadth.
It means this recovery was not concentrated in the biggest names – but instead had wider participation.
And it’s not just large-cap stocks either…
The small-cap Russell 2000 has also hit new highs.
As for SpaceX itself, it ended Friday up 19% from its IPO price…
Which as the table below shows, is actually the average first-day return for IPOs in the post-Dot Com bubble era.
In fact, you can also see that during the Dot-Com bubble from 1999 – 2000…
The average first-day return for IPOs was an absurd 65% – more than triple what we saw with SpaceX.
So yes, the SpaceX IPO was overhyped…
But its single-day price increase was par for the course for most IPOs…
And the broader market is looking healthier by the day.
But just as it was in the April-May rally…
As I explain below, you can expect a lot of people to doubt this recovery.
Insight of the Day
People who “doubt” the recovery won’t join in until all the early gains have been snapped up.
I’ve said it before…
But it’s not “facts don’t care about your feelings”…
It’s that feelings don’t care about facts.
Do you think those who believe the market is due for a reckoning care about the fact that the Equal-Weight S&P 500 and the Russell 2000 have hit new highs?
About the fact that SpaceX’s IPO surge was completely par for the course?
Of course not.
And by the time they’re convinced…
All the biggest gains would already have been snapped up.
Now, as I’ve said…
I’m not convinced that the pullback is for sure over yet.
So, even though now is a prime positioning opportunity…
The last thing we want to do is jump back in carelessly.
I’ll share more about how to jump back in intelligently tomorrow morning…
So make sure you keep an eye out for that.
In other news…
Have you heard about how the AI trade is changing…
And the 3 stocks that could profit as a result?
Customer Story of the Day
“Best service available, and I have tried them all.
Ross is the only one who spends his time trying to TEACH you how to do it rather than telling you buy this sell that.
It’s like the old saying, “Give a man a fish you feed him for a day, Teach a man to fish, you feed him for life.”
As a lifetime private trading club member I would Highly, Highly recommend TA to anybody, and I have recommended it to several of my friends and family.”
Ross Givens
Editor, Stock Surge Daily
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