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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MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN NFLX, AAPL, ACAD, TSLA
S&P 500 (SP500, SPX)
The S&P 500 filled the gap today as planned. What happens now? No clue! You ask too much of me, that is a joke. But I honestly do not know, because we didn’t get the reaction I would have liked to have seen.
The chart above show we filled the gap reasonably late in the day and rocketed higher after that. But the bad news is the index failed at resistance around 2,720, closing around 2,700. It tells me that we likely need to retest that 2685 level now.
What I would have liked to have seen was the gap fill, followed by a rise above 2,720. But still, the fact that we didn’t trade below 2,685 gives me hope we can continue to trend higher.
Netflix filled its gap and held very firmly around the $285 level. Which again is exactly what we would have liked to see. In hopes that the stock does moves higher from here, I have drawn in a green uptrend. Should it rise, I’m looking for a move back to $300.
What is also nice about the chart below is that volume happened to be reasonably strong today. Notice how the stock fell early in the day on low volume, but volume picked up around support at $285. It would suggest to me buyers and algos live around there.
Apple managed to fall to support at $186 and held. What seemed most interest, was that Dialog Semi said it was not seeing a hit to demand from Apple. So, either the market missed the news or merely didn’t care. You want to talk about a company being dependent on Apple. According to their 2017 annual report the company had total revenue of $1.043 billion, and total revenue of $1.352 billion. Apple and Dialog also have a $600 million licensing deal.
So, if there is any company that Apple is likely to not to switch suppliers with, Dialog seems like a good choice.
With all this talk about Apple, Tesla and Model 3 production have been moved to the back page. The stock looks like it about to break loose and rise into the mid-360’s.
Nvidia reports tomorrow, and the stock is now caught in a downtrend, and that RSI just keeps grinding lower. A retest of the lows is coming at $178.
The biotech’s are destroyed. I have no idea what happened to this group. The XBI biotech ETF is now down 26% from its highs. $72.50 is the next level of support. Looking back in hindsight, there was a clear triple top that formed during the summer months. Ugh!
Look at Neurocrine today, my goodness. This FAERS database is bad news when it comes to stocks. Just ask Acadia how CNN destroyed their stock from there terrible misunderstanding of the database. The bad news is the Neurocrine is likely heading to $76.
Acadia still can’t recover and is still feeling the effects 6 months later. I thought the stock was regrouping, I was wrong, once again. At least a golden cross is forming with the 50 rising over 200-day moving average. Otherwise, I no longer have a clue how this stock trades. .I have given up.
Have a great Night.
Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future.