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.
Otherwise, enjoy the column!
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July 21, 2020
Stocks – IBM, MSFT, TSLA,
Macro – QQQ, SPY, Gold, Copper
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MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN MSFT AND TESLA
S&P 500 (SPY)
Stocks are rising again, with the S&P 500 ETF trading around $326.85, and is likely to push higher to 329.40. Where there is has a resistance level, and then a gap fill which would take the ETF higher to around 332.90?
Again, people ask how much higher the market can rise, or if it will turn lower. I simply do not know. Typically, I look for signs such as bearish betting in the options market, or the technical trends. Recently those trends have been bearish. But to this point, it has been mostly muted, ignored, or not had time to work out. So right now, we must assume the market continues to rise, and if 329.50 is taken out in the SPY, we can wait for the gap fill up to $332.90.
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Nasdaq 100 (QQQ)
The QQQs are the index that needs to be watched since it seems that is where all the momentum is behind. Today the QQQs are testing the previous highs at $270, and if it gets through that level, then we must assume the trend has shifted, out of our trading channel. Again, the prior channel range and the bearish betting in the NASDAQ took place a lot over the past two weeks. So if things of those trends we have seen building for the past two weeks are real, then I would expect for the ETF to fail at resistance and turn lower. Today is Tuesday.
IBM is rising today, after reporting results yesterday. I’m somewhat surprised because the company once again gave no guidance. I don’t understand why at this point, a company cannot provide guidance. The cloud unit only grew by 1.8%, and this is their big growth engine? But in a market where results don’t matter, the stock up 5%. For now, the stock is failing ta resistance at $136.
Tesla will report results tomorrow, and the stock probably still runs higher into those results, and the next level today is $1750.
Microsoft will also report results tomorrow, and that stock is at resistance at $214, and we can see if that is a turning point or break out point. The stock is costly, and I’m not sure how much more it can rise based on its current valuation, but then again, none of that seems to matter anymore.
In the meantime, gold continues to rise.
Copper continues to hold on to the uptrend. For some reason, I keep watching this metal more closely than anything. As long as copper holds the uptrend, the risk-on trade will continue to work.
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.