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June 2, 2020
Stocks – ZM
Macro – SPX, QQQ
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MIKE’S READING THE MARKET PREMIUM CONTENT $35/MONTH OR $300/YR–Â
- The Long-Term Growth Outlook For Stocks May Take A Huge HitÂ
- DEALERS HOLDING KEY LEVELS
- 3,100 Or Bust Is Closing In
- Drifting Higher Midday 6.1.20
- BIG DAY FOR STOCKS
- MANY KEY EVENTS THIS WEEK
- EPS Trends For 5.30.20
It had been a very dull day, with stocks rocking between positive and negative territory. However, there was a massive $3.5 billion buy imbalance for the closing cross, which sent stock rocketing higher in the final 10 minutes. It left the S&P 500 closing at 3,081 resistance level. It is a region of resistance that we have been targeting now since the middle of May. We will have to see if the momentum can continue to carry the market higher.Â
Due to changes in open interest levels, it seems that options dealers are now using the 3,050 level as a region to get a long future to hedge themselves. As long as that remains, it looks like an area that likely to continue to offer the stock market support. Premium content – DEALERS HOLDING KEY LEVELS
NASDAQ (QQQ)
The Nasdaq jumped above resistance on that buy imbalance too, and it managed to take the index higher above 9,573. I’m not sure if I should consider this a break out, or not, I would have preferred it not to happen due to the closing cross. Tomorrow we will give us a better assessment. Should the index continue to climb, it is likely to reach 9750.
The number of stocks on the S&P 500 above their 50 moving average was at the highest level ever, or at least based on as far as my chart goes back. I don’t know if it means anything; take it to mean whatever you want.Â
Zoom (ZM)
Zoom will be one stock that should be watched closely. This is one of the most significant momentum stocks around. The company reported some fantastic numbers. I’m not sure if it is enough to keep the stock up. The company noted it expects earnings in a range of $1.21 to $1.29, better than estimates of $0.45 per share. That will result in analysts boosting their estimates. That should help to bring down some of the very high multiples. But still, to justify the valuation and get the stock to say five times one-year forwards, the company would need to have revenue jump to $10 billion next year, or even $10 billion by fiscal 2023. So if the momentum trade can stay alive and well, then that means this stock just continues higher.Â
That’s all for today.Â
-Mike
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. Â
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Charts used with the permission of Bloomberg Finance L.P. 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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