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April 7, 2021
STOCKS – TSLA, ZM, NVDA, BA, XBI
MACRO – SPY, IWM
Mike’s Reading The Markets (RTM) Premium Content – FREE 2-WEEK TRIAL
- Midday: Stocks Stall As Fed Minutes Reveal Little
- Morning Note -Growth Sell-Off May Not Be Over
- Midday- Inflation Expectations Fall
- Morning Note: Despite Index Level Gains, Very Little Has Changed
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN TSLA
The Fed minutes revealed very little if anything new today. The Fed remains committed to data-driven monetary policy, which is likely to stay low for a long time. However, I don’t think the yield curve reverting to 2020 levels anytime soon.
We got the big move we talked about late last week. At the time, I thought the move favored a drop, not a rise, but we got the rise. However, we have stalled out around 4,080 on the S&P 500, and based on the largest open interest level in the options, 4,000 is likely where the most gamma is concentrated. That is going to keep the index from moving much higher, especially with options expiration next week. 4,100 has a big level of interest too, but I’m not sure if it is enough.
Additionally, the index is overbought based on the upper Bollinger band and will likely results in a drop to fill some of the opening gaps, with the potential of it falling to 3,960.
Meanwhile, total call volume continues to drop across the market, which has really helped sink the VIX index to 17.2.
Biotech (XBI)
The XBI ETF was hit hard today, falling by 2.4%, and it has given back much of last week’s advance. This has occurred across the Russell 2000, which fell by 1.6% and may be a sign of what is to come for the S&P 500 and NASDAQ 100.
Tesla (TSLA)
Tesla has fallen after the big gap higher on Monday. For now, this looks like a typical gap fill, but clearly, a drop below $659 would indicate something worse, with a retest of $600 possible.
Zoom (ZM)
Zoom has not contributed to this recent rally and has been trying to hang on to support at $320. If it can’t get over $325 soon, a drop to $275 may very well become a reality.
Boeing (BA)
Boeing suddenly doesn’t look particularly strong. A drop below $252 sends it back to $239.
Nvidia (NVDA)
It is going to be very interesting to see what happens to Nvidia when it reaches $575. I still don’t think you will see those all-times again anytime soon, and I get the sense that it won’t make it much past $575 either.
Have a good one
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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