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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STOCKS – AMZN, MSFT, ZM, FB,
MACRO – SPY, QQQ
- RTM: Consolidating Ahead Of FOMC
- RTM- Market Is Repricing Risk
- RTM Long-Term Update- Adding Altria
- Tactical Update: The Fed Put Is Dead
- RTM: Thoughts On The Sell-Off
- ICYMI: LIVE Q&A SESSION –REPLAY
- RTM: Real Yield Spike Causes Market Reversal
- RTM Exclusive: PayPal’s Next Leg Lower Is Near
It was another volatile session, with the markets dropping sharply at the open and recovering throughout most of the day. While the S&P 500 still finished the day lower, as did the Qs, not much is happening. Just a lot of sideways trading action.
Something will have to break at some point, given tomorrow’s FOMC meeting. Again, I am not looking for the Fed to walk back its hawkish stance. Indeed the charts seem to confirm that something shall break too, with what appears to be a giant bear pennant pattern forming. If that is the case, the pattern should break tomorrow and then start moving to take out Monday’s lows.
We can also see that the 5-Yr TIP rate, after starting the day lower and then seeing its yield reverse and move higher. The 5Yr Tip yield filled the gap from its sharp move higher on January 19, and now it looks just about ready to start moving higher again. It looks like a bull flag pattern, although I will admit I didn’t draw it all that well.
It looks like the Qs wrapped wave four up and is now starting wave five down. This wave-down should help drive the Qs below the recent lows and probably below $330.
Microsoft reported better than expected results on the top and bottom, but Azure growth came in at 46%. The street likes to see around 50%, which didn’t happen this quarter. Now investors can start worrying about slowing data center growth. The conference call and guidance will be essential to what happens. The $282 level is a significant level of support that will need to hold, but if that breaks, it could drop to around $262.
Amazon could suffer tomorrow based on the 46% Azure growth rate. The stock is has been stuck below resistance at $2900. There is some mild support around $2,650, but really the next big level of support doesn’t come until $2,450.
Zoom is now breaking down, falling below around $150. It looks like the next significant level of support does not come until $107.50.
It looks like Facebook is breaking down, having fallen below $309 and closing today around $300. If the stock can’t recover that price quickly, it will likely decline to around $273.
We’ll see what the Fed says tomorrow.
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