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February 9, 2021
STOCKS – UBER, TSLA
MACRO – SPY, VIX, IWM
Mike’s Reading The Markets (RTM) Premium Content – FREE 2-WEEK TRIAL
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- Morning Note: Will Tomorrow Be The Turning Point?
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MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN TESLA
Stocks finished mixed on the day, with the S&P 500 dropping 3 bps. The index gapped higher to start rising around 50 bps, giving much of that back and then some mid-morning. There wasn’t a definitive reason for the reversal; I think it had more to do with the market being at the upper end of the trading range and the VIX having bottomed.
Overall, we remain in this mechanical market where the VIX and the S&P 500 are tied together. With implied volatility levels remaining at higher levels, the VIX will not break down. That means the S&P 500 is essentially stuck around 3,900.
S&P 500 (SPY)
The volume on the S&P 500 futures has really been drying up the past several sessions, while the RSI is not confirming the recent highs. These divergences are clearly bearish indicators. I still contend the next move in the S&P 500 is back to the 3,780 area on the chart.
Russell (IWM)
The Russell fell by 75 bps after failing at the top of the trading channel. The next move for the index appears to be towards the lower end of the channel at 2,150.
Tesla (TSLA)
Tesla has broken its uptrend, which makes support around $800 even more important. If support at $800 breaks, there could be a substantial drop back to $730.
Uber (UBER)
Uber is down around 4% after reporting revenue that missed estimates, I thought by a fairly wide margin. I don’t know what this company is anymore, and the food delivery business doesn’t excite me. It has a $116 billion market cap and is estimated to earn just $0.01 in 2023. The chart’s wave count may have been off slightly, but I still think the stock ends up in the same place, around $52ish.
Anyway, not feeling all that great today. So I’m gonna cut it short.
-Mike
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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