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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Michael Kramer and the clients of Mott Capital own Tesla
Stocks had a rather quiet day with the S&P 500 flat. The good news is that stock held their gains for the late-day rally on Friday. The bad news, the index is struggling to rise above 2,716.
The index moved and failed right at resistance at the start of the day. It is consolidating nicely at these prices, and it seems to be forming a bullish flag, a continuation pattern. It would suggest to me we do rise above resistance at 2,716, and test 2,730, while also filling that gap from last week — more on gaps to come.
Russell 2000 (IWM)
We can see that a similar setup in the Russell 2000 came and went, with the Russell breaking out and on its way back to 1,524
So it seems to me that the S&P 500 is going to be more than fine going forward. I think lasts week sell-off on Thursday was nothing but noise. It looks like I have been proven correct until I get proven wrong tomorrow. Joke –Laugh. 😆
Tesla (TSLA)
Anyway, moving on to Tesla. The stock is having a tough time getting over the $318. It appears that there may be a downtrend in place, which surprising to me. The RSI continues to point to higher prices, so I am sticking with a bullish outlook on the stock and rise back towards $333.
Amazon (AMZN)
Don’t get too excited if you have Amazon; I have some bad news for you. The stock is struggling at this $1620-ish level. The RSI has a clear trend, and it isn’t higher –that’s for sure.
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But here’s the thing, the RSI is more of a long-term trend lower. What I am seeing now is that the stock has the potential to rise with that falling wedge. It suggests Amazon could break out and first rise to around $1680 before moving lower again.
Nvidia (NVDA)
Nvidia reports on Friday, and as I noted this morning, the setup looks pretty bad. Here is a free story I wrote on the stock today. Nvidia’s Bulls May Be Too Optimistic
Activision (ATVI)
Talk about all gaps being filled. Activision, wow. Gap Filled! Next stop $35.80?
Goldman (GS)
All gaps get filled, eh? Watch out Goldman $183 is on the horizon. 😥
Morgan Stanley (MS)
Can you believe that Morgan Stanley is on the verge of a breakdown that could result in stock the retesting its Christmas Eve lows? 🙁
Inflation
Watch out inflation; the dollar is on the move. 😯 That looks like a double bottom in the dollar index and that means we may be seeing a rise back to 100 on the index soon. Kiss your inflation worries goodbye, and forget about any more rate hikes in 2019, should the dollar keep going up. Draghi wins again. What will the ECB do when his term is over?!
It means that how copper trades will be even more critical because a strong dollar should weaken copper prices. So if copper should continue to rise, it tells us something about global growth.
See you tomorrow.
-Mike
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 results.