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4/18/22
STOCKS – ARKK, DIS, HD, ADBE, ZM
MACRO – SPY, IEF, LQD
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The S&P 500 finished the day lower by one bps, and the NASDAQ QQQ ETF finished higher by eight bps. It could have been worse, with the index rallying sharply in the final 10 minutes of the day with the S&P 500 climbing by 50 bps. Whatever selling that was pressuring stocks into the close decreased in those last 10-minutes. Perhaps there was one prominent seller, and we will need to see if the seller shows back up tomorrow or not.
Financial Conditions (IEF, LQD)
The IEF/LQD ratio was higher today, suggesting that financial conditions are tightening again. This is important to watch should they continue to move higher. The tighter the conditions get, the worse it will be for stocks, and the fact of the matter is that conditions should tighten further since that is what the Fed’s intention is.
Adobe (ADBE)
Adobe shares have stalled out and are now still sitting at $425. This has really been the critical level of support for Adobe, and to this point it has held each time. We just need to wait and see what will happen. But this is a significant level, and should it the stock break down; it would be a terrible sign.
ARKK (ARKK)
The ARKK ETF fell today below support at $58.50, which probably puts the ETF on a path to drop to around $54.50.
Disney (DIS)
Disney is in a similar spot as Adobe, with the stock very close to breaking a very significant level of support at $127.75. Once that level breaks, nothing keeps the stock from going back to $117.
Home Depot (HD)
Home Depot also finds itself on crucial support at $300, and like the others, there is not a lot holding the stock up from falling back to $285.
Zoom (ZM)
Zoom is also sitting in the same spot, as the others, on support.
These are all sitting on key support levels, and we can see how weak they look, and if they break, it is not a positive for stocks overall. It implies just how fragile the market is here and how little it may take to break it down to the downside.
-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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