Stocks Drift Lower On March 4, As A Bearish Rising Wedge Pattern Forms In The S&P 500

Independent macro and options research, published every trading day — $85/mo or $750/yr

3/4/24

#Stocks – $AAPL

#Macro – $NDX, $XLK, $SPX

Mike’s Reading The Markets Macro Subscription Service on Seeking Alpha

Michael Kramer And The Clients of Mott Capital own AAPL and GOOGL

The S&P 500 finished lower today, dropping by around ten bps and led lower by Apple, Tesla, and Alphabet. Yes, they all fell by 2% or more, and the only reason why the index was down ten bps was that Nvidia was up 3.6% and offset all of Apple’s declines.

The XLK was flat today, and we can see that the XLK was not able to advance beyond the upper trend line in the broadening wedge pattern. It will be interesting to see if the XLK moves lower tomorrow and heads toward the lower trend line of the wedge and the giant gap at $199.

Meanwhile, one reason the XLK may continue lower is Apple, which fell by 2.5% today, and is now at lowest point since November. There’s certainly a technical case for Apple to go lower at this point, and perhaps a fundamental one, given the weakness of iPhone sales in China in recent quarters, and less then stellar results. A return to $166 doesn’t seem impossible, given that the stock has broken support at $180.

Meanwhile, another rising wedge formed in the S&P 500. This one seems bigger and broader than the one last seen in Mid-January and again in Mid-February, both of which retraced 50% and 61.8% of their respective moves higher. So, we will see how the market treats this pattern. There have been three clear touches of the upper trend line and just two on the lower trendline, so if the index gaps lower tomorrow, and below 5,125, then rising wedge is broken, and lower prices and that potential gap fill at 4,950 may be on its way.

We will see what happens tomorrow. Tomorrow, ISM services data will be available at 10 AM.

-Mike

Michael Kramer publishes independent macro and options research read across 10+ platforms and by institutional desks. For research syndication, licensing, or consulting inquiries, visit michaeljkramer.com.

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.

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.