August 26 – Stock mentions: SPY, PG, NFLX, AMD, BB, TSLA, CAT

Michael Kramer and the clients of Mott Capital own TSLA and NFLX

Maybe it was a half-hearted rally on August 26; I’m not sure. Or perhaps it is the last week of August, and everyone is in the Hamptons relaxing, it would seem that way by the amount of traffic I witnessed driving home on Friday, but something seems amiss. The rally felt uninspiring, perhaps that was because most of the surge came in the final minutes, with the S&P 500 rising by about 1.1%.

The S&P 500 struggled all day long on August 26 tossing and turning at technical support around 2872.  But it was the final 10-minutes that saw the index surge. The next level to watch is 2,900.

But when looking around the market from many different angles, I think the equity market should find support in many various forms, fundamentals, technicals, and even bonds. Equities remain attractive, especially when considering the alternatives. I talked about in a premium video today: Markets Are Not As Bad As They May Seems

The latest GDPNow data shows that the third quarter US GDP is tracking at roughly 2.3%, up from the last reading of 2.2%.  If this pace continues, then we can kiss a 2019 recession goodbye. There is will soon only be one quarter left in 2019.

I guess I can’t find myself to be all gloom and doom. Is the world perfect? No. But are we heading over a cliff? No.

The next day or two will be very telling, but as long as trade talk moves to the back pages, then I suspect the market will begin to work higher once again.

Does that mean that all equities are attractive? No. Not all equities are attractive for various reasons. I wrote an article today on P&G that showed a lot of bearish options betting.P&G Stock May Be Overdue For A Drop

Netflix (NFLX)

I’m not sure what to say about Netflix at this point. The lines for the pattern continue to transform itself regularly. However the one constant is the pattern itself which continues to be falling wedge, a bullish reversal pattern. Maybe it is only a matter of time before NFLX breaks higher.  The RSI continues to suggest the same.  I noticed some bullish activity last week too. Here Is Why Netflix May See A Rebound

AMD (AMD)

AMD didn’t have a particularly good day, gapping higher then fading. Now it has a big gap to fall back at $29.40. Poor AMD. The momentum was so in favor just a few weeks ago. But everything changed when it couldn’t hold the rally at $34.25.

Blackberry (BB)

Blackberry is resting on support at $6.50, and it has managed to hold on a few occasions. The RSI is starting to show some life, and perhaps this one moves higher on a bounce towards $7.50.

Caterpillar (CAT)

Caterpillar looks as if it is working its way lower to a gap fill at $107.80

Tesla (TSLA)

Tesla is at the lower end of the trading range; now it may push higher towards $225.

Until tomorrow

-Mike