To The Moon

48% gain within 60 mins from taking calls at open. The market is not at all affected by the Israel-Hamas conflict with treasury yields retreating and market surging forth. ⚠️ Trading tips: looking at QQQ calls above 369.55 and puts below 367.78 on Wednesday.

On Wednesday, the Bureau of Labor Statistics is set to unveil the eagerly awaited Producer Price Index (PPI) report for September, a day before the widely-followed Consumer Price Index (CPI) report. Both the PPI and the CPI constitute the final two crucial economic indicators leading up to the Federal Open Market Committee Meeting scheduled for 31 Oct to 1 Nov.

Ride the trend for now

The magnificent seven are up approximately 96% year-to-date on average versus the equal weight S&P 500 index, which is flat. That creates an uphill battle from the start, he said.

The group of tech juggernauts generates more than 50% of their revenues from outside the U.S. and the dollar is up about 6% since the middle of July, which creates a significant headwind for company guidance this quarter, Satori Fund founder and portfolio manager Dan Niles explained. 

"That's where actually a majority of this risk lies as you think about Q3, and more importantly, guidance into Q4," he said. Still, Niles is long Alphabet Inc (NASDAQ:GOOG) and Nvidia Corp (NASDAQ:NVDA) heading into earnings as he anticipates "beat and raise quarters" from both. 

He noted that Nvidia blew away numbers last quarter and raised guidance significantly, yet the stock is down 4% from the day before the announcement. That's a "warning sign" for this earnings season, especially for companies that don't have the growth Nvidia does, he said. 

Investors are going to have to pick their spots among the group. You can't just buy the basket of all seven tech giants and expect that to work given the valuations of some of these names, he said.

Tesla Inc (NASDAQ:TSLA) and Apple Inc (NASDAQ:AAPL) are two examples. Tesla is currently trading with a forward P/E of about 58 and Apple is trading at about 27 times forward earnings. Niles is short both of them, but he specifically picked on Tesla. 

"They've got a pretty high bar to clear going into Q4. At the same time, you've got the consumer running out of money in terms of excess savings and then you've got student loans restarting. We think there are a lot of headwinds in the stock," the Satori Fund manager said.

Cathie Wood-led Ark Invest made a notable move by selling over $8 million worth of Tesla Inc (NASDAQ:TSLA) shares. This significant trade comes amidst a series of Tesla disposals by Ark, marking the third consecutive session of selling the electric vehicle giant’s stock.

Ark Invest sold 31,418 shares of the Elon Musk-led company through its flagship ARK Innovation ETF (NYSE:ARKK). The transaction was valued at $8.28 million — based on Tesla stock’s closing price of $263.62 on Tuesday.

Alphabet closed 0.22% lower, Nvidia finished 1.16% higher, Tesla climbed 1.52% and Apple ended Tuesday's session 0.34% lower.

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