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September 25 – Stock mentions: SPY, SHOP, NFLX, AMZN, MU
Michael Kramer and the clients of Mott Capital own NFLX
Macro
Stocks had a strong rebound on September 25 with the S&P 500 rising by about 65 bps to finish the day at 2,985. The market seems to have shrugged off the impeachment inquiry and instead completely turned when President Trump said a trade deal with China could happen sooner than you think. At least, we now know the order of importance, or what the market views as more important at this point.
S&P 500 (SPY)
The level around 2985 has acted been acting as a mild level of support, so now that turns to resistance. You can see by the chart how that is precisely where it stopped rising today.
There is now a downtrend in which the index needs to contend with around 2,995. A break of that downtrend will likely help to push the index back to the highs. A failure at that index likely results in a retest of the August breakout. It is that simple at this point.
Stocks
Shopify (SHOP)
Shopify had a good day, regaining some of its losses. I continue to think that this stock is in the middle of some momentum unwind if such a thing still even exists. Regardless the stock had a nice bounce today and appears to have formed a double bottom and also broke the downtrend that had been in place since September 6. Now, all it needs to do is get back over $315 to make a push back to $335.
Netflix (NFLX)
Netflix also had a nice bounce today, and it too appears to have broken a downtrend that started on September 18. The stock needs to get back over $273 to consider a bounce back to $284, and perhaps the worst of the decline is behind us.
Micron (MU)
Micron will report results tomorrow after the close, and the stock is in a rising wedge, but based on the wedge it seems possible that the stock could rise to around $52 before eventually doing a U-turn lower.ย But when it comes to earnings, technicals are very hard to rely on, solely.
Amazon (AMZN)
Amazon had a nice bounce-back too, but like the others, it still needs to clear a level of resistance at $1775. The stock has been dead since the beginning of August.
That’s going to be it for today. Back at some point tomorrow.
-Mike
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