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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MARCH 23, 2020
STOCKS: NKE, SQ, DIS,BAC
MACRO: SPY, VIX, SMH
I have been covering the recent turbulence in the markets and have been actively helping my members understand what is taking place in SA market place and on StockTwits. If you need help during this time or have questions, please try my Seeking Alpha Marketplace service Reading The Markets, or on StockTwits Reading The Markets
S&P 500 (SPY)
Stocks continue to melt, even after the Fed just launched QE infinity. The S&P 500 fell another 3.0% and is trading around 2,235. It managed to find some support around 2,190 to the start of the day, but that’s about the only positive thing I can point to.
The strangest thing I have seen recently is this dual pattern forming in the S&P 500. The trading channel is a force and one that appears to be very strong. But on top of that, there appears to be another pattern forming within that channel.
It appears that a falling wedge pattern is forming, and that may mean that the index is rising to the upper end of the range of the trading channel around perhaps back to around 2,270. What’s even crazier is it would only take us back to where we were to start the day.
The VIX managed to come down some today, falling to around 65. That is still too high and doesn’t suggest things are getting any better.
The semis managed to have a pretty decent day, with the SMH rising. But again, like the broader indexes, the downtrend strong for this group as well.
Nike has dropped to prices not seen since 2017, and likely isn’t finished falling, with the next significant level of support down at $50.60.
Meanwhile, Square has been destroyed and can hopefully find some support around $33.50.
Disney has also been hurt, and they are going to struggle, given a big portion of their business has been hit the hardest by the virus. The stock so far has stopped at $78 and could be heading lower towards $70.
Bank of America (BAC)
Bank of America is now falling to support at $18.25, a price it hasn’t been at since the election, closing all gaps takes it $17.
ok that’s it.
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