Travel Back On?

Hey Market Pilot,

Last week, I wrote a piece about the S&P 500 (SPY) fading below the daily 50 simple moving average (SMA). In that article, I cautioned about shorting the market because I didn’t know how many opportunities there might be. Turns out there was a nice drop, but you either had to be in the day before or trade it the day of because it didn’t even last an entire market session. The SPY tapped the weekly 21 exponential moving average (EMA) on this past Monday and that was support for now.

I am wary of one more move down sometime this week in order for price to retest some low area, so I am keeping an eye out for that and looking for long opportunities after that.

A sector that had a surprisingly strong move this week was in the travel, entertainment, and leisure sector. This sector has been very susceptible to the waves of Covid-19 cases and has gone from dead, to alive, to hibernating, and now looks like it is waking up again. 

Here is a list of names that fall into this category and they all had a good week:

  • Travel Tech ETF (AWAY), US Global Jets ETF (JETS)
  • SeaWorld (SEAS), Six Flags (SIX), Dave & Buster’s (PLAY)
  • Marriott (MAR), Hyatt (H), Hilton (HLT)
  • Live Nation (LYV), Eventbrite (EB)
  • MGM Resorts (MGM), Caesars (CZR)
  • Carnival (CCL), Royal Caribbean (RCL)
  • Yelp (YELP), Cheesecake Factory (CAKE), Red Robin (RRGB)
  • Booking Holdings (BKNG), BYD Company (BYD), 

This is only a partial list to give you an idea of what is happening and provide ideas for where to look. My understanding as to why they are moving again is that this recent wave of Covid-19 cases has apparently peaked and total vaccination rates are going up. Whatever the reason might be, they are looking interesting and may be fertile trading grounds. That is until the next Covid-19 variant comes along with another round of cases and more restrictions…

Your Profit Pilot, TG


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