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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STOCKS: MSFT, ACAD, SQ
MACRO: SPY,
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN ACAD, MSFT
Stocks fell slightly today by about 40 basis points to close at 3,116, holding support at 3,110. So did we bottom? Again, the signs continue to suggest that we are bottoming. You want to agree with the six signs I pointed out yesterday, that’s up to you. But after a drop of 8% in a straight line, a 40 basis point drop to around yesterday’s lows of 3,118, seems even to me.
Regardless we need to hope this is around the bottom as noted yesterday. Otherwise, things are going to get much worse. We are at an inflection point for many important indicators, as well as the 10-year yield. So we need to see some signs of improvement and soon.
The number of stocks below their 50 and 200 day-moving average are now at the low end of the range, and there has only been a handful of other times it has gotten lower.
You can see in both of the charts above those ratios could fall significantly from their current levels if we don’t see a change in sentiment. I went through those charts and a bunch more in a video today. Premium content – The Sell-Off Is Either Ending Or It’s About To Get A Whole Lot Worse
S&P 500 (SPY)
Anyway, by days end, it became clear that 3,130 was resistance, and 3,110 was acting as support. So what happens tomorrow? I’m still in the camp that this region is around the bottom. We remain in oversold conditions on the RSI, and as I showed you in the chart above, the number of stocks below their respective moving average suggests they bounce.
Acadia (ACAD)
Acadia reported strong results beating on the top and bottom, and guiding revenue well above expectations. The stock is trading up to around $41.30 after hours. I’m interested in what they say on the call.
Square (SQ)
Square is popping after reporting better than expected results and guiding inline. The stock is jumping, filling the gap up to $83 in the after hours. That is resistance, be careful here.
Microsoft (MSFT)
Microsoft is falling after announcing it would not meet guidance on its More Personal Computing unit guidance. The stock is trading around the range it has been in the last few days.
Anyway, that’s all I have tonight.
-Mike
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