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January 5, 2020
Stocks: AAPL, NFLX, TSLA, XOM, SNAP, FB, ROKU
Macro: Economy, Tel Aviv
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN AAPL, NFLX, TSLA
It will be a big week for economic data with the ISM Services Index, ADP job report, and the BLS job report. These are pretty much as important as they come when it comes to helping us determine the strength of the US economy. I continue to believe the economy here in the US is improving. Fourth GDPNow forecast suggests growth of 2.3% and based on my previous analysis, that suggests to me the economy may be growing by as fast as 2.8%. The ISM Manufacturing report on Friday was a disappointment, so I’m going to need to see good numbers this week to give me confidence that the economy is going in the direction I think it is going. You can read more about the week ahead in my premium content section, get the first 2-weeks free Sector Rotation On Watch For The Week Of January 6
Tel Aviv
There is little way of knowing how the market will respond to the rising tensions with Iran, but based on how Israel traded overnight, there wasn’t much of a reaction, with the Tel Aviv 35 Index trading lower by 55 bps.
More tomorrow on this.
Apple (AAPL)
Anyway, Apple continues to move high as investors are seemingly re-rating the stock, and while it isn’t clear to me how much further Apple can run, it would seem that over the short-term, it must be getting closer to the end of the rally, then the beginning. Currently, analysts estimates forecast the company to earn $16 in 2022, and at 20 times estimates, the stock is worth $320. The chart suggests the next level of resistance comes around $310.
Tesla (TSLA)
Tesla could be heading to $500. Call me crazy, sure. But look at the pattern in the chart, hard to deny there isn’t something to it.
Netflix (NFLX)
I think that Netflix continues to trend higher, at least the RSI suggests that it does. The RSI broke free of a multi-year downtrend, and it indicates to me that Netflix is likely to see its RSI continue to trend higher in the future. That means the stock continues to rise, with the next level of resistance at $336. A gap-fill would follow that up to $360.
Exxon (XOM)
There is currently a bullish divergence forming in Exxon, with that RSI rising higher, and stock price going nowhere. Exxon is very close to breaking free of a downtrend and rising above resistance at $72. If that happens, $76 is the next level to watch for.
Snap (SNAP)
Snap is another stock nearing a breakout, with resistance at $17.20. The stock could have upside to $18.40.
Facebook (FB)
Facebook clearly wants to fill the gap up to $218.
Roku (ROKU)
I should have been more clear on Roku yesterday. I think the stock rises to around $141 this week and then heads lower again over the short-term.
Have a great Sunday!
-Mike
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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