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 8, 2020
STOCKS: TSLA, NFLX, SQ, UBER, ROKU
MACRO – SPY, XLE
Premium Content From January 8:
- Stronger ADP Data Could Lead To Postive Surprise Friday
- Stocks Soar As Tensions Ease Jobs Impress
- Mentions: ACAD, CSCO, MA, NFLX, PANW, ROKU, SPY, SQ, TWTR, V, XLE
- Stocks Rebound- Morning Commentary
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN NFLX AND TSLA
Well, that was fun. From panic to euphoria in less than 24 hours. A little manic? Perhaps.
Ok, maybe it wasn’t euphoric today, but surely it wasn’t anywhere close to what the futures were indicating last night. Maybe the ADP Job report helped a bit there. I think the report paints a positive picture for Friday’s BLS job report. I review all of this in a video today and noted that a solid reading could imply a 4Q GDP growth rate as high as 3% when finally get the reading later this month. Premium video content – Stronger ADP Data Could Lead To Postive Surprise Friday
Additionally, President Trump’s announcement on Iran surely helped to calm fears too.
S&P 500 (SPY)
It is kind of amazing that the S&P 500 futures touched 3,180 last night at 7:30 PM, only to reach 3,267 by 3:15 PM today. That’s only a 2.65% reversal off the lows. It is pretty insane.
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The goods news here is the futures took out resistance at 3,253, and the previous highs around 3,260. It does suggest that the S&P 500 continues higher.
Additionally, the pattern in the cash market would also suggest that higher prices are coming, despite not officially breaking out today. It seems to me based on the chart that a flag pattern has formed, and it suggests higher stock prices lay ahead for the index, if not tomorrow, then Friday.
One has to wonder what has happened to the energy sector. If it can’t rally on rising oil prices, then what is going to be a catalyst for the group? It is worth noting that the XLE ETF is trading at levels not seen since the year 2000 relative to the SPY. It is nearly at its lowest point ever. It is trading as if it is a dying asset class, perhaps it is.
Anyway, if you want a mind-blogging chart. Look at this one of Tesla relative to the S&P 500 ETF. What is interesting here is that Tesla isn’t even at its highest levels relative to the S&P 500, which was in June 2017. It is almost as if the stock is trying to play a giant game of catch up for all those years of underperformance.
The stock got as high as $498 today, and pretty close to the $508 technical target I laid out over the weekend. I guess my number 5 prediction for 2019, ran eight days late :(… such is life. Prediction #5 – Tesla’s Stock Rises 50% to $500 in 2019
Square continues to rip higher, and those options traders have to be feeling good about themselves at this point. It looks like $70 is the next level potentially for the stock. Premium content from January 2- Square May Rise On Bullish Betting.
Well, Roku seems to be going according to plan this week, that’s good. It probably means the stock goes to $127.
Uber is finally starting to come back to life, rising above $33.15, and now it may be on its way to $35.90. It looks like the falling wedge pattern is now in full effect.
Should we talk about Netflix? Ok, fine. I mentioned it today in the mid-day update, noting the stock was challenging resistance at $336. It finally broke out and climbed above resistance to around $339. The RSI and the push above resistance make me think the stock can now work to fill that gap up to $362. How many times have I said that before. 😛 Premium midday commentary – Stocks Soar As Tensions Ease Jobs Impress
Have a good night