Stocks May Open Lower, But The Trends Have Shifted

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.

Otherwise, enjoy the column!

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JANUARY 31, 2020

STOCKS: AMZN, SHOP, NFLX, WDC, UBER

MACRO: SPY

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S&P 500 (SPY) 

Stocks are pointing to a lower opening to finish out the month after that significant reversal yesterday afternoon. But it seems like the S&P 500 at this point is just riding the trendline, and as long as that remains, I don’t see any reason for that to have changed. I did a whole video for subscribers yesterday, showing the signs the market was delivering that suggests that the worst of the sell-off was likely over, and I continue to believe that is the case. Premium video – It Sure Feels Like The Markets Have Bottomed

You can see what appears to be a nice double-bottomed in the futures; we need to see resistance at 3,295 taken out.

es S&P 500

Amazon (AMZN) 

Amazon shares are jumping after its big beat on earnings. The company does a beautiful job of playing Wall Street better than any company in recent memory. Setting expectations low, and just every once in awhile reducing spending just enough to give investors a taste of what is possible. Anyway, I had noted over a week ago, the stock was likely to jump following results, and then I saw some last-minute options bets being made yesterday on top of it at the January 31 $1850 and $1860 calls, which implied a jump over $1900. Good for the options, guys.  Premium content – Support Is Holding, Now Is It Time To Fill The Gap Higher?

$2060 may very well act as resistance today, with that giant gap being created, be mindful of the gap.

amazon, amzn

Western Digital (WDC)

Western Digital is rising today after reporting better results, and a bunch of price target increases. The stock acts strong, and has held support around $66, and is likely to reach out options traders break-even prices, and the next level of resistance at $76.

western digital,wdc

Shop (SHOP)

Shop appears to be getting a boost from Amazon’s results and seems to be breaking out finally. The company reports results on February 12, and given the price action, and how hard it has fought at the $477 level, it is likely not one you want to bet against at this point. So let’s move on and admit defeat.

shop, shopify

Uber (UBER)

Uber was initiated at JPM today with a $51 price target. The chart looks increasingly bullish, and I will be watching for the options bets on this one, they are sure to come. The next level of resistance may not be until $40.60.

uber, uber

Netflix (NFLX)

Finally, I noted the other day, the big spread transaction in Netflix that indicates that $340 is likely to be a floor in the stock. So far that seems to be the case, I think the stock is going to challenge the downtrend and resistance at $362. Premium content –Why Netflix Stock May Have Bottomed

netflix, nflx

Have a great day 

-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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