Unlock Deeper Insights with Exclusive Member-Only Video Content on The Market Chronicles YouTube Channel – Just $34.99/Month
Options Impact To Come Thursday
Semis Near Critical Support Levels Following ASML Weak Outlook
Low Volume Holiday Trading Session
#STOCKS: #ASML, #TSM, #WING
#MACRO: #SPX, #SMH
Stocks finished the day mixed, but tomorrow morning will be a key moment for earnings season as Taiwan Semiconductor (TSMC) reports its results. These results are always closely watched, especially for insights into Nvidia’s performance, but they carry extra weight this time following ASML’s surprisingly weak results.
Analysts expect TSMC to report third-quarter earnings of $0.36 per share on revenue of $23.3 billion, with gross margins projected at 54.8%.
The fourth-quarter outlook may hold even more significance, as it will provide insight into what’s ahead. Analysts are forecasting earnings of $0.38 per share on revenue of $24.94 billion, with gross margins of 54.7%. If TSMC beats expectations and provides a strong outlook, it could help soothe concerns raised by ASML’s report. So, these results are important for the semiconductor group.
SMH
What’s interesting is that despite Nvidia’s more than 3% rise today, the SMH ETF remained flat, reflecting broader weakness in the sector. The key question now is where the ETF goes from here—the chart doesn’t look promising, and today’s action seems more like a pause than a turnaround.
S&P 500
There has been a noticeable pattern of bearish engulfing candles in the S&P 500, often followed by an up day, occurring around key turning points in the index. The real test, however, isn’t where the index moves in the next day or two but where it stands a week from now. We have spoken about this before. The one difference this time is that today’s came on a Tuesday, while the others have come mostly on Thursday.
WING
Today, Wingstop’s stock dropped nearly 4%, breaking below key support. The next potential support level is around $366. Why does Wingstop matter? Interestingly, it seems to have a knack for signaling where the Nasdaq might be heading.
-Mike
Charts used with the permission of Bloomberg Finance L.P. 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.