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September 21, 2020
STOCKS – AAPL, FCX, ROKU
Macro – SPY, GLD, UUP
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- This Is A Different Sell-Off
- The Market Has Little To Support It
- The Second Leg Lower – Morning
- 10 THEMES FOR THE WEEK OF SEPTEMBER 21
- Nvidia May Drop 15% More
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Stocks fell sharply with the S&P 500 finishing the day lower by around 1.2%. It had been much worse, with the index down well over 2%. The index fell below crucial support around 3,260-3,270 while managing to reclaim that level by days end.
S&P 500 (SPY)
I’m not sure that much changed though overall in the general direction of the market, which continues to be lower. It is entirely possible that we even see the S&P 500 climb back to 3,340 over the next couple of days, to close the gap from this morning sharp drop. It wouldn’t change anything.
The market has nothing to support underneath now that momentum is broken. (Premium Video – 1st 2-weeks are FREE to try – The Market Has Little To Support It)
Dollar
Today’s sell-off did have a different tone, with the financials, industrials, and materials falling the hardest with the three sectors down between 2 and 3%. The sell-off today seemed to be driven more by the dollar than anything else. The dollar rallied somewhat sharply and managed to puncture through that challenging region of resistance 93.50. I talked about this in the mid-day update today. (Premium content – Get The 1st 2-Weeks Free – This Is A Different Sell-Off)
A stronger dollar may continue to hurt this group, especially those multi-nationally that export aboard, thus reducing revenue and earnings forecasts. Additionally, we know the damage a stronger dollar can do to the commodity trade.
Gold (GLD)
It is why gold broke today, falling below support at $1,925, which will now act as resistance, on it way back to $1,790.
Meanwhile, it is also one reason why Freeport McMoran could be heading lower and back to $12.70, with a drop below $14.90.
Apple (AAPL)
Apple bounced back today, but notice where it failed at resistance around $110.
Roku (ROKU)
Roku went up 18% today because it finally got a deal to put Peacock on its streaming player. I don’t see how Peacock adds up to an 18% move in the stock; it seems kind of crazy to me. I wonder how much extra revenue Peacock will bring in for service that has no charge and runs ads? I guess the premium version doesn’t have ads, but still. Anyway, the stock shot up to an all-time high and probably has a bit more to go, since it technically isn’t overbought yet. Maybe I’m missing something here.
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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