You Can Almost Feel the Heat

You may be wondering what is "going on" with the stock market these days. After the historically rough fourth quarter, namely December and the holiday season, stocks put in a bottom on Christmas Eve and have not looked back ever since. Along the road higher, we have seen one call after the next for the market to roll back over and print fresh lows. 

Instead of that scenario developing, though, various sectors have emerged as legitimate replacements in aggregate, of the storied "FANG" names (plus AAPL and the likes of NVDA). Mind you, Netflix remains a solid chart compared to FANG peers. But most of those names are not nearly as impressive as some of the emerging software and healthcare plays. Just these last two sessions, for example, some "sleeper" diagnostics plays in healthcare have exploded higher up and out of bases: GH and THOR. We had both on the watchlist for Members earlier in the week, and will be stalking them closely going forward for more average daily volume to trade in them as well as for lower risk long entry points. 

Indeed, you can almost feel the heat on shorts, with equities surging again as I write this. The current market has the look and feel of a "pain trade" which is now the controlling scenario, as Mr. Market seeks to inflict maximum pain on those brazen enough to stand in his way since Christmas. 

On that note, sharks may be circling around Overstock, but now the way bears think they would have. OSTK is easily one of the most heavily-shorted names in the market, not to mention being a rather hated name for a variety of reasons, some justified and some not. 

But getting down to brass tacks, the OSTK daily chart, updated below, is coiling after its recent rally off multi-quarter lows. Savvy shorts should have likely been covering some into that devastating prior downtrend. And with crypto-related plays catching some relief of late, if not glimpses of renewed momentum, I suspect OSTK shorts will continue to feel the heat above $20, especially.