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📣 The Daily Breakdown from Bret Kenwell @Bretman, eToro's investment and Options Analyst 🗓️ Wednesday’s TLDR — May 29, 2024 😴 Stocks chop in a tight range after record highs. 🛢️ ConocoPhillips buys Marathon Oil. 🏆 Nvidia racks up another record high. ✳️ What’s happening? A few weeks ago, the $SPX500 broke out to new highs. Since then though, it’s mostly chopped around, not gaining or losing more than 1% from the closing price on May 15. We’ve seen consolidating price action elsewhere too, as $BTC digests its recent rally and as the $NSDQ100 is only up 1.5% since May 15 despite the explosive rally in $NVDA (NVIDIA Corporation) over the last few days. From a volume perspective, it already feels like we’re in the dog days of summer. I’m not quite certain why volume has dropped so much, but that’s the environment we find ourselves in. The trailing 20-day average trading on the $SPY is 52.4 million shares. A month ago, this figure stood at 72.6 million. Three months ago it was at 71.8 million. So far, low volume has been favorable for bulls. But with a slowdown in the rally, some are looking for a dip. While a pullback could be healthy, a full-blown breakdown doesn’t appear to be in the cards right now. ✳️ The setup — $DAL (Delta Air Lines Inc (DE)) Shares of Delta Air Lines are moving lower on Wednesday morning after $AAL (American Airlines Group Inc) lowered its Q2 profit forecast. Delta — which hit a 52-week high just a few weeks ago — is being dragged down too, adding to the recent dip. However, the decline has the stock set to open at an interesting level on the chart (Chart below as of the close on May 28, 2024. Source: eToro ProCharts, courtesy of TradingView). 📈📊📉 That’s as shares approach the 50-day moving average and prior resistance. Will these combine to act as support? If support holds, bulls can look for a bounce. However, if support doesn’t materialize, it may be best for investors to consider a stop-loss to prevent small losses from turning into big losses. ▶️ Options This is one area where options can come into play, as the risk is tied to the premium paid when buying options or option spreads. Bulls can utilize calls or call spreads to speculate on a rebound, while bears can use puts or puts spreads to speculate on more downside should support break. For those looking to learn more about options, consider visiting the eToro Academy. That being said, investors can be neutral on $DAL and choose to do nothing with the stock. Remember, you don’t have to be involved with every stock all the time. 🔗 to Academy = www.etoro.com/en-us/academy/options/ 👀 What Wall Street is watching 👀 $MRO (Marathon Oil Corp) — Shares of Marathon Oil are in focus on Wednesday morning after $COP (ConocoPhillips Co) has agreed to buy the firm in an all-stock deal. The deal weighs in with a $22.5 billion enterprise value, including $5.4 billion in debt. $DKS (Dicks Sporting Goods Inc) — Dick’s Sporting Goods is rallying on Wednesday morning after the retailer delivered a top- and bottom-line beat for its Q1 results. Revenue grew 6.3% year over year, while management raised its full-year revenue and earnings outlook above consensus expectations. $NVDA — Nvidia stock hit a new record high for the third consecutive trading day, spurred by news of Elon Musk's xAI buying Nvidia AI chips for a supercomputer. The supercomputer will use Nvidia's H100 GPUs, aiming to enhance xAI's AI chatbot, “Grok.” 🔎 📚 Are your investments in line with today's news? Check your portfolio on eToro to make sure you aren't missing any opportunities. Disclaimer: Please note that due to market volatility, some of the prices may have already been reached and scenarios played out. Content, research, tools, and stock symbols displayed are for educational purposes only and do not imply a recommendation or solicitation to engage in any specific investment strategy. All investments involve risk, losses may exceed the amount of principal invested, and past performance does not guarantee future results. Options involve risk and are not suitable for all investors. Please review the Characteristics and Risks of Standardized Options (etoro.tw/3Dr98GK) prior to engaging in options trading.