This column is my opinion and expresses my views. Those views can change at a moments notice when the market changes. I am not right all the time and I do not expect to be. I disclose all my positions clearly listed on the page, and I do not trade my account on the stocks spoken of in this column unless fully disclosed. If that does not work for you stop reading and close the page. Do not bother me or harass me.
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MICHAEL KRAMER AND CLIENTS OF MOTT CAPITAL OWN AAPL, NFLX, TSLA
S&P 500 (SP500, SPX)
Stocks continued to rise today, despite the bears best effort to weigh the stock market down. The S&P 500 continued to advance, and the next level of technical resistance still rest around at 2,752.
Nvidia took a significant beating today, as well it should. The quarter was a disaster and so was the guidance. The stock was down 19%. Analysts have taken down their fourth quarter earnings estimates by 31% and revenue estimates by 21%. Full-year estimates fell sharply. Despite the steep decline it is still trading at 19 times 2020 earnings estimates of $8.19. Earnings estimates for next year have only dropped 5.6% and revenue by 4.4%. These number probably still have even further to fall.
The stock isn’t cheap by a long shot not when compared to other semi stocks. This stock probably trades with a sub 15 earnings multiple like most of the other big chip companies.
A break below $160 sends the stock to $139.50.
Amazon can’t get over $1620; it is incredible to see. I think the longer its stay under $1620 the more likely the odds the stock heads lower. I know this is a change from where we stood last week, but we do not live in a static environment, and we need to adjust our thinking.
Netflix has been stuck at this $285 region for far too long. Now I’m starting to get worried about this as well. But there is a long-term uptrend on the way that needs to lift this stock higher. If this uptrend is broken, I’m going to start getting really worried.
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Apple is nearing a break out which may mean the stock is on its way towards $209.
Micron is nearing a make or break moment. If it can rise above resistance at $40.25, then perhaps it has room to increase to $42. But I’m not sure that can happen. The RSI is still trending lower. So a decline to $36.30 seems more likely.
10-year rates are sitting on the neckline of a major break down. Should yields fall below 3.06, then 3% is next, and a double-top in yields has been confirmed.
Tesla is nearing a break out at $360, and should it rise above that price it will be trading near or above its all-time by year-end, the RSI is trending higher, and its supports higher prices.
Intel is nearing a big break out too, and should it rise above $49 it is on its way to $51.
Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future results.
apple, tesla, intel, nvidia, micron, amazon