Stocks May Fall Sharply On June 19

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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June 18, 2020

STOCKS – FB, NFLX, ADBE, MU

MACRO – SPY, QQQ, FDN

Mike Reading The Markets Premium Content – $35/Month or $300/Year

There was a lot of back and forth today with the S&P 500 not getting enough traction to move in either direction. The day started with some significant price swings, but those swings contracted throughout the day. 

S&P 500 (SPY)

The S&P 500 e-minis formed an exciting pattern today, which I noted in the chatroom for subscribers. It appears to be a wedge pattern, which would indicate that a rather significant move in the index may be upon as soon as tomorrow. Overall, there is a downtrend in the S&P 500, and the pattern would indicate to me that the next move in the index will be lower. If it works out the way, I think it can; the index could see a drop to 3000. 

It seems like a long shot and may prove to be just that. But there is a wedge pattern that has formed in the e-minis, and it is likely to lead to a rather sizable move tomorrow one way or the other.

NASDAQ 100 (QQQ)

The QQQs have been unable to advance past $245 the last few days, and now the volume is beginning to fall. It would indicate that the ETF is likely to pullback, potentially falling back to $239. 

Internet ETF (FDN)

The FDN ETF also appears to be seeing a change in trend, falling out of its uptrend, and an RSI, which is now trading lower. 

Micron (MU)

Micron has been drifting and is nearing support at $49.80 and maybe set to decline to around $45.50. The RSI is trending lower, suggesting the stock is losing momentum. 

Adobe (ADBE)

Adobe is another one of these software stocks that has run. The channel is nearly perfect. But the stock is now making a bearish divergence, with the RSI falling and the stock price reaching a new high. But until it breaks that lower trend line, the stock will just keep rising. 

Netflix (NFLX)

Netflix needs to break out, or the stock really could be in trouble. 

Facebook (FB)

Facebook is also diverging, with an RSI trending lower, and the price moving sideways and unable to break out. 

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Well, that is it, time to get ready for tonight’s webinar. 

-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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