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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STOCKS – AMD, NVDA
MACRO – SPY, QQQ, XBI
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It will be a short update tonight, my two daughters have a dance recital, and I can’t be late.
Another miserable day for stocks, with the S&P 500 dropping 3.25% and hitting the 3,650 level we discussed earlier in the week. Unless we are about to go on some unforeseen path, I think that level should hold some, and we should get a nice counter trend rally. I don’t think a bottom is in yet, but we are getting there.
That 3,650 level falls right on the main trend line that has defined the shape of the sell-off from the very beginning. Unless we are going into some crash mode and heading to 3,350. I think next week we could see a nice rebound back to around 3,725
Tomorrow is quadruple witching, which means we could see a countertrend rally start late tomorrow or Monday, which can send the S&P 500 and the QQQ higher again—perhaps sending the Qs back to $280.
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For the S&P 500, there is a nice big gap that needs to fill up to 3,800, but I would look for the first level of resistance to come around 3,725. Options expiration should free up the markets to trade higher, as market makers have to unwind their hedges and buy back S&P 500 and Nasdaq futures, helping lift stocks.
AMD fell below support today at around $86, which may be important. It has held on several attempts. But this last attempt proved to be too much.
I mention AMD because NVDA finds itself on crucial support. It hasn’t broken yet, but if AMD broke support, I imagine that NVDA will too.
Keep an eye on the Biotech XBI ETF. The market is making new lows, and this ETF isn’t. The XBI led the market lower, and if it stops going down, it could be telling us where we are in the cycle of this pullback.
Have a good one
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. 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.