Stocks Continue To Face Stiff Levels of Technical Resistance

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 – FB, NFLX, SQ, ROKU

MACRO – SPY, QQQ

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S&P 500 (SPY)

Stocks finished the day higher, coming back from a move lower in the S&P 500 futures. It was a strange day, because, for some reason, there remains a stiff level of resistance around the 3,115 level in the S&P 500. It has been that way for several days now. I’m not sure what to make of it at this point. It suggests if anything, a tight trading range is forming for the moment, between 3050 and 3150. it wouldn’t be the worst thing in the world to have some sideways consolidation. It would certainly be better than a steep pullback, and better than the markets continuing to get overextended.

NASDAQ 100 (QQQ)

The Qs reached Friday’s highs, and that is where they stopped rising. For the moment, there is nothing new here. It is going to become very important for the Qs to make a new high in the next few days to keep the bullish momentum going. The Qs continue to remain in a very well defined trading channel. 

From another viewpoint, you can see the Qs are still on the lower side of the rising wedge pattern I noted two weeks ago. At this point, I think it doesn’t mean much of anything from a bullish or bearish standpoint. Volume levels continue to dry up, which could be an indication the number of buyers is thinning out.

qqq

Facebook (FB)

Today I saw some more bearish betting on Facebook. It would mark the second time I have seen such bets in the past week. I noted that activity in a post to paying subscribers this morning. Premium content – Stock Testing Big Resistance Levels – Midday


Netflix (NFLX)

Netflix finally broke out, which was desperately needed. It means the stock can avoid that head and shoulders pattern I was fearful was forming. 

Square (SQ)

Square jumped today after getting a price target boost at Barclays to $115 from $90. I still tend to think this one pulls back to $91, but then again, I was wrong as of today. 

Roku (ROKU)

Roku failed today at $135, and that is a significant level of resistance it will need to penetrate for that run to $150 I was looking for based on that reverse head and shoulders pattern. 

ok, that is it!

-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.    

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