This column is my opinion and expresses my views. Those views can change at a moments notice when the market changes. I am not right all the time and I do not expect to be. I disclose all my positions clearly listed on the page, and I do not trade my account on the stocks spoken of in this column unless fully disclosed. If that does not work for you stop reading and close the page. Do not bother me or harass me.
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Stocks Fall, The One NASDAQ Chart You Must See, Plus Apple and More
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN SHARES OF AAPL, NFLX, TSLA
Man, these days are just strange? I’m starting to lose track of all the excuse for the stock market sell-off. First, it was this, then it that. Really? How about nobody has a clue what the reason for the sell-off is and sometimes stocks go down for no reason at all. Seriously. There doesn’t always have to be a reason.
Reason #1 – Blame China
I hope we are not going to start to focus on the Chinese stock or the Chinese Yuan. People seem to forget that China does NOT have a free market. The RMB is Not a free-floating currency. The RMB is devaluing it because the Chinese government is devaluing. They set the price every day.
Now that Shanghai composite is down 30% from its January highs, US investors are going to start to worry? Really? It is not the reason our stock market is going down.
Reason #2 – Blame The Treasury Sec.
Then it was because of Treasury Sec. Mnuchin pulled out the “Davos in the Desert Summit.” Well if that was the reason then somebody forgot to the Oil market because it fell on the day.
Anyway, it doesn’t matter. I’m sure tomorrow there will be plenty of more excuses that will be cooked up to explain to us simple-minded people what is happening. Are we having fun yet? Good.
S&P 500 (SPX, SP500)
I do not know what to make of today’s trading activity, except that I was surprised by it. Look, if you are looking for good news, all I can say is that trend, for now, is higher, and the index is still above our critical level of technical support. For those you that do not remember, if the S&P 500 falls below the zone of support I drew out in the chart, then I fear it will retest the February lows.
I draw up so many charts that sometimes I find charts I have forgotten I made. Then I stare at them, and I’m like, how did miss this? Well, gee, I missed a big one, that really would have come in handy about two weeks ago. I’m looking at this chart, which is now below, of the NASDAQ and I’m trying to figure out what these two random green lines that are going all over the place.
Then I’m like you know before I delete these lines let me make into a logarithmic chart and see what happens. Like Magic, I get the chart below. Now I have a chart with basically 40 years of a very clearly defined trading channel. Could the NASDAQ trade to the lower end of that channel? Anything is possible, but that would also mean the NASDAQ would need to fall to 5,400, so lets certainly hope not. But it does suggest the market is either about to go on a parabolic ride higher followed by Y2K (the year 2000) pullback or the NASDAQ is likely topping out and will need to consolidate to get back within the channel.
Let’s move. I have another magic trick for you today, It is called Apple. That is because Apple’s stock magically stopped falling again at? BINGO! $215 to $217. Magic! I mean whoever is buying this stock is either the shittest trader that ever live or the “institution” buying it doesn’t care and wants to own every share they can. This is a $215 stock, trading 32 million shares. It makes the stock trading volume worth about $6.9 billion .
The fact that this stock does “come-in” tells me that whoever is buying it thinks it is going higher because they don’t care about saving $10 or $15 per share, and they badly want to own it!. Does anyone want to guess who it could be? I most certainly have one in mind.
Netflix, I thought the drop to $357 was going to be enough to satisfy the Algo’s. Apparently not. I think it may have to fall to $342 first.
Amazon failed at $1840, and that means $1740 comes back into play.
It looks like Tesla is still acting pretty well, and is getting ready to retest support/resistance at $261.
Roku’s stock chart looks horrible, as the air continues to come out of it. If $56 breaks, $52.75 is next.
Man, I was kicking myself two weeks ago’s for not buying Boeing. Now I’m thrilled I trusted my instincts and stayed away.
The dollar is nearing a pretty big break out. Oh, that is right, I forgot, Italy was another reason the market was down today. The EU rejected Italy’s budget. Duh! How could I forget!
Hey, at least tomorrow is Friday.
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.
spx, NASDAQ, stocks, amzn, aapl, nflx, tsla, dollar, china