July 12, 2020
STOCKS – AMZN, NFLX, FB, MU, QCOM, JPM
MACRO – SPY, FNGS
Mike Reading The Markets Premium Content – $35/Month or $300/Year
- NASDAQ IS RIPE FOR A SIZEABLE DROP – WEEK AHEAD
- JPM May Jump As Much As 10% Followings Its Quarterly Results
- Live Webinar Will Be July 30
- EPS Estimates Continue To Slide
- The Worst May Be Yet To Come
- Markets Setting Up For 5-6% Dip
- Nvidia Is Priced For Perfection, May Have Topped Out?
It will be a big week for the stock market as earnings season kicks into high gear. We will get results from all the big banks starting on Tuesday, and how these results go could begin to set the tone for the balance of the summer. Premium content – NASDAQ IS RIPE FOR A SIZEABLE DROP – WEEK AHEAD
S&P 500 (SPY)
The S&P 500 is in an interesting spot, right now battling a downtrend that started in February, while at the same time showing some bullish trends. The chart currently shows a bull flag pattern has formed on the daily chart over the last two weeks, and if the index can manage to push through that resistance level around 3,180 and the downtrend, then I think it has an excellent chance to race back to 3,265. If it can’t, then we are looking at a drop back to 3,115.
The worst-case scenario would be for the market to give a false break out on Monday. Meaning we push higher, only to drop sharply on Tuesday and the rest of the week. It is too close to call at this point what happens.
JPMorgan will report results on Tuesday, and the stock is very close to breaking out, and that means results can send shares higher to $104. I also saw some bullish betting during the week that suggests the stock rises in the weeks following results. Premium content – JPM May Jump As Much As 10% Followings Its Quarterly Results
Qualcomm may be starting to top out here. We can see that it broke that downtrend a while back but has struggled to advance beyond $93. The RSI is also starting to lose some momentum, so perhaps it drops back to $88.
Micron never got to that $45.50 level I thought it might get too, but it never ran up either. Now the stock appears it is going to decide what happens next finally. It seems this time it breaks higher, out of that triangle pattern, pushing to $52.75.
Netflix will report results this week, and I will on the lookout for options activity on this one, so check back. It seems the stock may still have a bit further to rise before it runs out of juice and turns lower. Look for a push up to $570.
What happens if some of these advertisers who are boycotting Facebook find out that they can do alright without it. That’s a significant risk, isn’t it? While it is unlikely advertisers don’t come back, who to say they don’t come back differently. We just don’t know? It has happened before. Perhaps that is why the stock is struggling around resistance at $242. I still contend the stock trades lower, back to $222.
I thought Amazon would be on its way back to $2,285, I still believe that is possible, but it will likely have to wait until after earnings, based on the current chart. However, I think it can drop back to 2750 before earnings.
One reason, I think Amazon can pull back. Just look at the fear trade taking place in the FANG+ ETF. It has gone parabolic, and how long can that last. A break of the uptrend quickly sends it back to $69, along with all the components with it.
Have a great Sunday!
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