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OCTOBER 21, 2020
STOCKS – AMD, NFLX, TSLA, SHOP
MACRO – SPY, QQQ, SMH
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN TSLA
Stocks were down on October 21, with the S&P 500 dropping around 25 basis points, while the Qs fell by around 10 basis points. It didn’t feel like an overly exciting day, with markets basically waiting on headlines regarding a stimulus deal. So far, there has been no news of a deal, just that they are getting closer, and I continue to think there will be no deal. But the market continues to trade off various headlines.
S&P 500 (SPY)
As a result of the dullness, the technical charts really didn’t change very much. We are pretty much in the same spot as yesterday, hovering around support at the S&P 500 around 3,440. I still think we have a good chance to target 3,600 by the election.
NASDAQ 100 (QQQ)
Meanwhile, the Qs are hanging around the $284 region.
10-Year
The 10-year yield reached its highest levels in some today and climbing above 80 basis points. The higher yields are a result of the potential more stimulus coming.
Semis (SMH)
The SMH is starting to show major signs of weakness, and I noted earlier that a massive option bet was placed that the ETF falls from here. A drop below $180 would create problems for the sector. (Premium content – Betting Semis Drop- Morning)
AMD (AMD)
AMD is one of those chip stocks that keep on falling. Again, we will still need to break below $75 before knowing just how bad things will get. The RSI keeps telling us the same thing; lower prices are coming.
Netflix (NFLX)
Netflix had a weak day as expected. But the stock managed to fall below that critical level of support around $495, which likely sets up a further drop to around $470.
Tesla (TSLA)
Tesla reported better than expected revenue and earnings while maintaining its full delivery guidance. The stock is trading up only modestly. I still think it is likely heading higher, towards $460. There was also a tremendous bet that suggests shares continue even higher towards $600 into June. (Premium content -first 2 weeks are free to try – Tesla’s Stock May Be Heading Much Higher Long-Term)
Shopify (SHOP)
An interesting pattern forming in Shopify, a potential head and shoulders. It has a lot of the same characteristics as AMD.
Have a good one
-Mike
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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.
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