Stocks Jump On September 14 Holding On To Early Morning Advance

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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September 14, 2020

STOCKS – NVDA, MU, AMZN, ORCL

Macro – SPY, QQQ

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S&P 500 (SPY)

Stocks were mostly higher today, but the rally ran out juice around lunch, and it was more about maintaining the gains, then adding on to them. The S&P 500 finished the day higher by around 1.2%. But it seems there is now a downtrend that has formed in the index. If that is the case, then today’s rally should vanish rather quickly tomorrow, with a fill of the gap from Friday to 3,340.  (Premium content – A Downtrend Is Born)

Nasdaq (QQQ)

Meanwhile, the Qs have the same kind of pattern with the lower trend line, with the potential to refill the gap at $270. 

Option Volume

How the rest of the week goes will mainly be dependant upon the Fed on Wednesday and Quadruple witching on Friday. Call volume was down again, despite the stronger day for stocks. Put volume was weaker too, but that is to be expected on a stronger day. 

(Trade Alert)

Call volume was the weakest since the middle of August. The weaker call volumes could be one reason why it feels like some of the thrust in the market isn’t there. The dealers don’t have to hedge as much stock.

(Trade Alert)

Amazon (AMZN)

It was also a weaker day for Amazon despite the significant market gains. The stock opened higher and filled the gap by days end, finishing around support at $3,100. That support level continues to be a battleground for Amazon, with a break of support triggering a decline to around $2,800. 

Nvidia (NVDA)

Nvidia gapped, higher, and I don’t expect it to last after investors have time to digest the ARM deal. Nvidia paid a lot for ARM, at nearly 20 times sales, and the deal is dilutive to shareholders, with Nvidia pay a large portion in stock.

Micron (MU) 

Micron rallied today following that upgrade but couldn’t quite get past resistance around $49.80. My immediate reaction is that the stock works to fill that gap lower. 

Oracle (ORCL)

Oracle is hitting up against resistance around $61, with a potential break out sending the stock higher to $66. I noted some bullish betting suggesting the stock continue to rise, even though it is the preferred technology provider to TikTok in the US, whatever that means, and not the owner of TikTok.  Oracle’s Stock May Have Even Further To Climb

 

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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