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September 14, 2021
Stocks – AAPL, NFLX, ROKU, CMCSA
Macro – SPY, VIX
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MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN SHARES OF APPLE
Stocks fell today, closing right on our 4,440 level of support on the S&P 500. As noted yesterday, it completed a gap fill from August 20. But really, more importantly, perhaps, is that the index finished the day below the October 2020 uptrend. That could be a meaningful event because when trend lines break, new trends are formed, and that is a downtrend for now.
VIX (VIX)
The biggest problem is the quadruple witching event that will take place this Friday and the FOMC meeting next week. This could result in traders opting not to sell volatility, especially into the FOMC meeting. That means we will not get the usual sharp rally in the market on pullbacks. In fact, the VIX hardly even moved today, basically finishing the day flat. Which I found to be interesting and do not have a great explanation for at this point.
S&P 500 (SPY)
There will be a lot on the line tomorrow, especially if the S&P 500 gaps down below 4,440. It would signal a further decline to somewhere around 4,360. Additionally, that would likely send the RSI on the index below 42, which could be big. SINCE FEBRUARY, the RSI on the S&P 500 has been a source of support on several occasions. I can’t explain why the index finds support at 42, but it does coincide with the 50-day moving average, which has also served as support in the past.
Apple (AAPL)
Apple finished the day lower by around 1%, following an uninspiring debut of its new iPhone. It is really just a mild upgrade to the iPhone 12. I don’t see it being a big deal. The stock managed to finish the day at the 50-day moving average, but there is a divergence with the RSI, and I still think it heads lower to $130.
Netflix (NFLX)
Netflix was down around 2% today, and it looks like the gamma squeeze is now unwinding. The stock managed to hold on to support at $575. That is really the key level here, with a break setting up a drop back to $545, which I expect to happen. (This should be free to read- Netflix Stock: Gamma Squeeze May Be Ready To Pop)
Roku (ROKU)
Not a fun day for Roku as the melt continues. The next support level does not come until $295. It is too expensive even at that price.
Comcast (CMCSA)
Comcast had a horrible day after the company lowered expectations around net additions for the quarter. The stock plunged 7% following the news and broke the uptrend that had been working so well. So chalk that one up to not working out as planned.
Have a good one
Mike
Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future results.
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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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