10/16/22

#STOCKS – $ARKK, $TSLA, $TWLO, $ROKU, $AMZN

MACRO – $SPY, #RATES,

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• RTM: Breaking Down 10.13.22 Trading Action
• RTM: Volatility May Be About To Pick Up
• RTM: CPI Hotter, Stocks Crushed
• RTM: CPI Report Could Lead To Drop In Stocks
• RTM: Fed Minutes Are Non-Event, Turning Attention To CPI
• RTM: CPI May Be Hotter Than Expected
• RTM: AMD’S Stock Faces Further Losses
• RTM: Replay Of Q&A Session 10.10.22
• RTM: Intel May Have Even Further Downside
• RTM- Next Live Q&A Zoom Session Oct 10th At 11 AM ET

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Stocks had a rough Friday after a failed rally attempt on Thursday. The S&P 500 fell by more than 2% on Friday to close the week lower by more than 1.5%. The bearish rising cup and handle pattern I had pointed out on Thursday followed through on Friday and resulted in the index close at 3,583, which took it back to Wednesday’s level.

Typically, a rising cup and handle pattern returns to the cup’s lows, around 3,500. Additionally, the decline on Friday serves as a rejection of the Thursday rally, and typically Friday sell-offs follow through into Monday.

The NYSE Advance-Decline made a new low on Friday, perhaps leading the way to a new low in the S&P 500. It would suggest that the lows on Thursday were not a capitulatory event, and the lows for the market are probably not in.

10-Yr

Additionally, rates continue to rise, and it’s hard for me to think that we could continue to see rates rise and equity prices bottom. So, as long as rates continue to make new highs, then stocks should continue to make new lows. The 10-Yr yield made a new closing high from Friday, finishing the day at 4.02%. A forecast of the more recent move higher off the October 4 lows suggests the 10-yr could climb to around 4.4%.

ARKK (ARKK)

Well, so much for ARKK rallying. The ETF continues its descent, as the RSI suggested the other day. At this point, one can only hope it finds some support at the lower end of its trading channel at approximately $31.50.

Tesla (TSLA)

Tesla will report results this week, and the chart looks awful, as it trades just slightly below support at $205. If that support level breaks, there is nothing until $180, and of course, there is that gap at $137, that still needs to be filled.

Amazon (AMZN)

With Amazon giving back all of those summertime gains, it might as well retest the lows around $102. I think we will find out that $102 is not the bottom.

Netflix (NFLX)

Netflix looks like it is in a distribution pattern, suggesting the shares return to where the rally started at $170.

Twilio (TWLO)

Twilio keeps melting as well, and with support now in play at $63, the drop to $44 becomes a possibility.

Roku (ROKU)

We can finish off with one of my favorites. Roku is just melting away, trading at levels not seen since 2019, and with a gap to fill at $34, I think there is still a good chance it will get there.

Good Luck this week

Mike

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