8/28/22

STOCKS –  AAPL, TSLA, AMD, NVDA

MACRO – SPY, DXY, BTC

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• RTM: POWELL STRIKES BACK
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• RTM: The TLT May Be On The Verge Of Heading To New Lows

MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN AAPL

Stocks fell sharply on Friday as equity investors finally realized there is no dovish Fed pivot. The S&P 500 fell by more than 3% and saw plenty of technical damage. The index managed to close below critical levels of support at 4,070, and the major level of support does not re-emerge until the 3950 area, a region I have been looking for since August.

It also appears that the index may have completed a Head And Shoulders pattern, another negative pattern suggesting lower prices are likely ahead. At this point, I am not projecting anything beyond 3,950.

Dollar

The dollar index also had a strong move higher and appeared to be breaking out of a bull flag, suggesting higher values for the dollar index. Based on a breakout projection, the dollar index could climb to 110.50.

Nasdaq (QQQ)

The QQQ ETF also fell by 4.1%, which appears to have broken the neckline of a head and shoulder pattern. It is likely to result in the ETF falling to between $295 to $300.

Apple (AAPL)

Apple’s share fell sharply on Friday and more recently has gapped below the lower bound of an uptrend which probably results in the shares working to fill the gap around $156. Additionally, the upward momentum on the RSI has broken as well.

Tesla (TSLA)

Tesla has a head and shoulder pattern and is close to breaking the neckline. If the neckline is broken, it is likely to result in the shares filling the gap of around $248.

Nvidia (NVDA)

The market finally woke up to how terrible Nvidia’s results and guidance were, with the shares dropping by nearly 9% on Friday. The next level of support for Nvidia comes around $154, but I think the stock should fall much lower, as the shares aren’t cheap despite the massive drop.

AMD (AMD)

AMD fell as well, as it should have, by 6%. Like it or not, the stock is in the same boat as Nvidia, and I do not think they will be immune to Nvidia’s “issues.” Revisiting the trend line seems likely in this case.

Bitcoin

Bitcoin fell out of the big bear flag I pointed out a couple of weeks ago, and looks like it is setting up for its next leg down. The hourly chart shows a smaller bear flag that has not broken, leading to another 13% drop to around 18,000. The problem with Bitcoin is that it has no value, and because it has no value, it is impossible to find a level where buyers can say it is fundamentally cheap.

Have a good Sunday.

-mike

Charts used with the permission of Bloomberg Finance LP. 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.