12.1.20

Stocks – ZM, AMD, DOCU, CRM

Macro –  SPY

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• The S&P 500 Breaks Out, Uber Is A $90B Food Delivery Co, Zoom Breaks
• Zoom Goes Pop, As The Markets Rock
• Tesla’s Valuation Is Steep. Still Some Think It Has Further To Rise
• Stocks Stuck In Neutral As AMD Surges
• Zoom Earnings, And The Need For Data Analytics – Morning 11.30.20
• One More Push Higher – The Week Ahead 11.30.20

S&P 500 (SPY)

Stocks rose today, with the S&P 500 closing around 3,660. It managed to close just above resistance at 3,645, and one needs to wonder what is next.  For now, that resistance level is likely to come around 3,710. I have reasons to think after that; we will once again see one of those typical pullbacks of the 5-10% kind.

The only thing that is interesting today is that the S&P 500 futures failed at the prior highs around 3,670. So perhaps a divergent indicator. I honestly did notice this until now. Tomorrow should help to bring some extra clarity.

Salesforce (CRM)

Salesforce reported results, and as I thought they would be, weren’t as good as they appear. The revenue guidance for the next quarter and year are better than expected, but they include Slack’s revenue. Otherwise, they are basically inline. Meanwhile, the company earnings were boosted again by the equity holdings:

Earnings per Share: Third quarter GAAP diluted earnings per share was $1.15, and non-GAAP diluted earnings per share was $1.74. Mark-to-market accounting of the Company’s strategic investments, required by ASU 2016-01, benefited GAAP diluted earnings per share by $0.83 based on a U.S. tax rate of 25% and non-GAAP diluted earnings per share by $0.86 based on a non-GAAP tax rate of 22%.

The stock is now very close to breaking down in a big way and filling the big gap down around $219.

AMD (AMD)

AMD managed to rise today but pay attention to where it failed and noticed how it finished lower today in a strong tape. Let’s see where the stock goes next.

Zoom (ZM)

Zoom fell by about 15% today. I guess for today, the stock’s bloated valuation matters. Suddenly, everyone woke up that it doesn’t matter how many users you have if you don’t make money on them. In fact, they become dead weight, dragging margins lower, with no end in sight. The only good news for Zoom is that there is again a gap to fill around $475. But then again there is a bigger one to fill at $325.

The bad news is that Volume is rising, and the RSI is moving lower. That means the next stop is probably $325.

DocuSign (DOCU)

DocuSign reports this week too. Another overvalued stock. That is falling on rising volume and an RSI that is trending lower. It is a steep drop to $160, but it wouldn’t surprise me in the least. (Free story – DocuSign’s Valuation Is Mind Bending).

That’ll be all.

Mike

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