Is it Time to Sell ELF Beauty Amid Market Volatility?

Is it Time to Sell ELF Beauty Amid Market Volatility?

Dow Jones futures rose slightly overnight, as did S&P 500 and Nasdaq futures.




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The stock rally closed on a slightly mixed note on Wednesday, amid mixed economic data and Fed Chief Jerome Powell signaling no change in the rate cut outlook.

Metaplatforms (META), HubSpot (HUBS) issued buy signals. Parent Google Alphabet (GOOGLE) remains in a buying zone while Arista Networks (Aneta) recovered a point of purchase. Google’s stock fell slightly late on buzz about AI-powered search.

In the meantime, Nvidia (NVDA) holds the support, working quietly on a basis with several other AI chip makers.

Elf Beauty (ELF), big winner since mid-2022, plunged on Wednesday after the retailer Ulta Beauty (ULTA) warned of weak demand. ELF stock broke long-term support, issuing a sell signal.

Investors should be cautious in the current market situation, especially with Friday’s jobs report on the horizon.

Nvidia and META Stocks Are On the Move MII classification. Meta and Arista Stocks in Progress Swing Trader. Nvidia, Meta Platforms, HubSpot, Arista Networks shares are on the market. IBD 50 List. ELF Beauty was Wednesday’s IBD Stock of the Day.

Dow Jones Futures Today

Dow Jones futures were 0.2% above fair value. S&P 500 futures rose 0.25% and Nasdaq 100 futures climbed 0.4%.

Remember that overnight action Dow Jones Futures and elsewhere does not necessarily translate into real exchanges during the next regular class sotck exchange session.


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Stock market rally

The stock market rally had a relatively calm session on Wednesday.

Before the opening, the ADP jobs survey indicated that private sector hiring in March was slightly stronger than expected. But the ISM services index, released at 10 a.m. ET, fell unexpectedly, signaling a slowdown in economic growth in March.

Fed Chief Jerome Powell said policymakers were in no rush to cut rates, largely reiterating their recent comments. But he also said recent strong economic reports had not “materially changed” the trend toward slowing inflation and the outlook for rate cuts.

The Dow Jones Industrial Average fell 0.1% on Wednesday stock market trading, retreating after resuming the intraday 21-day line. The S&P 500 index edged up 0.1%, with shares of Ulta Beauty and ELF the biggest losers. The Nasdaq Composite Index rose 0.2%.

The small-cap Russell 2000 index rose 0.5%, moving back above the 21-day line.

US crude oil prices edged up 0.3% to $85.43 per barrel, jumping 5% over the past four sessions.

The 10-year Treasury yield fell 1 basis point to 4.35%, reversing from a new intraday high of 4.43% in 2024 following ISM Services data and comments from the Chief Financial Officer. Fed, Powell.

ETFs

Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (VAT) increased by 0.2%. The VanEck Vectors Semiconductor ETF (SMH) increased by 0.4%. Nvidia stock is by far SMH’s largest holding.

Reflecting more speculative stocks, ARK Innovation ETF (ARKK) rose slightly by 0.3% and ARK Genomics ETF (ARKG) closed apartment

SPDR S&P Metals & Mining ETF (XME) jumped 2.2% and the GlobalPAVE) climbed 1%. US Global Jets ETF (JETS) fell by 0.5%.

The SPDR S&P Homebuilders ETF (XHB) and the Energy Select SPDR ETF (XLE) increased by 0.7%. The SPDR Fund for the Selected Health Care Sector (XLIV) fell 0.1%.

The Select Industrial Sector SPDR Fund (XLII) increased by 0.5%. The Financial Select SPDR ETF (45) closed a fraction lower.


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ELF Beauty Stock

ELF stock has been a model stock for over a year, climbing 983% from its May 2022 low to its early March high.

But stocks have retreated in recent weeks. On Wednesday, ELF Beauty plunged 11.9% to 163.77, crossing the 10-week line with heavy volume. This is the first time ELF stock has undercut this key level since last November.

The cosmetics maker fell Wednesday as the beauty retailer Ulta Beauty (ULTA) warned of weak demand to start the current quarter. ULTA stock plunged 15.3%, below its 200-day line. Cosmetics manufacturers Coty (COTY) And Estee Lauder (HE) fell by 6.3% and 4.2% respectively.

Long-term holders of ELF stock are likely to realize at least some of the profits. They could choose to see if ELF rebounds by Friday’s close.

Stocks Near Buy Points

Meta stock gained 1.9% to 506.74, moving above the 500 level and extending its rebound from the 10-week line. This provides a buying opportunity. Meta could be forging his 2024 first base.

Google stock edged up 0.2% to 154.93, staying within range of a 152.15 buy point cleared Monday. Stocks fell slightly late Wednesday following a Financial Times report that Google is considering charging for AI-based search.

Google’s Waymo self-driving service is partnering with Uber Eats for food delivery in Phoenix.

HubSpot stock jumped 2.7% to 626.70 on heavy volume, resuming an early entry on a trendline. HUBS stock has a 660 buy point from a flat base, basis on basis model.

Arista stock rose 2.7% to 298.79, bouncing off the 21-day line once again and retaking a fixed-base buy point of 292.66, according to MarketSurge Analysis.

NVIDIA Stock

Nvidia stock fell 0.55% to 889.64, again finding support at the 21-day moving average. NVDA stock has been in a possible base for a few weeks, but needs more time. An aggressive trader could use a move above 904-905 as a starting point or perhaps to add shares.

It is no coincidence that a number of other AI values ​​are consolidating around key support, including Broadcom (AVGO), Advanced microsystems (AMD), Taiwan Semiconductor (TSM).

What to do now

Some stocks have exceeded or flirted with entries outside the 10-week line, providing possible buying opportunities. This could work, especially if the market rebounds quickly, so investors could try a position or two.

But a sideways market is one of the biggest challenges for growth investors. A correction or bear market drives investors away. But in a limited market, stocks will often show just enough strength to attract buyers before pulling back. Promising stocks finding support could look much worse with relatively modest declines.

While Meta, HubSpot and Arista Networks closed in the upper half of their intraday range, Salesforce.com (RCMP) largely erased Wednesday’s gains while and Uber Technologies (UBER) slightly lower.

Friday’s jobs report could have a big impact on the market, especially with Treasury yields at the forefront.

Ultimately, a sideways market is often constructive – if investors have the patience to wait. A slightly longer pause would allow more stocks to forge bases, including Nvidia and other AI chipsets that have led the market rally.

So work on your watchlists, looking for these emerging bases and other setups.

Read The big picture every day to stay in tune with the direction of the market and the main values ​​and sectors.

Please follow Ed Carson on the discussions at @edcarson1971 and X/Twitter on @IBD_ECarson for stock market updates and more.

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