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4/20/22
STOCKS – NFLX, DIS, SHOP
MACRO – QQQ, ARKK
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The market fell today, with most of the damage contained to the NASDAQ. The QQQ ETF dropped by more than 1.4% following Netflix’s move lower, resulting in a good portion of yesterday’s rally being erased. The remaining balance of the gains is likely to vanish in the coming days as the Qs head back to $336.
ARKK ETF (ARKK)
It was much worse than that for many stocks in the market, with other stocks in that former stay-at-home trade collapsing. The ARKK ETF fell nearly 6% on the day, which erased all of the 4% gains from yesterday and more. The trend remains lower.
I think a lot of this was due to the weakness in Netflix, as investors are probably worried that other companies are now going to face a similar type of mass exodus. That is entirely possible; we won’t know until we see some of these results. But when there is uncertainty, investors sell, and they don’t have the patience to wait.
Shopify (SHOP)
Shopify fell 13.3% today and was pounded even harder after it became known that the company was looking to make an acquisition for Deliverr in a $2b deal. Perhaps this was a short-gamma squeeze at play, with the put volume surging and implied volatility and skew rising. The market doesn’t seem to like the idea that Shopify is going down the Amazon route. The other problem is that the stock isn’t cheap yet. It is getting there but still needs to see some further downside; I think $440 is the next price to watch for here.
Netflix (NFLX)
Netflix fell right into the January 2018 gap today at $226, and that is where it stayed. It probably does a lot of nothing for a very long time now, with a downside risk to $200.
Disney (DIS)
Disney fell today, as expected. It gapped below support at $127 and now seems to be well on its way to $117, as it fell in sympathy with Netflix.
That’s about it.
-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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