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STOCKS – AAPL, NVDA
MACRO – SPY, QQQ
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MICHAEL KRAMER AND CLIENTS OF MOTT CAPITAL OWN AAPL
I shared this video with members of my SA Marketplace service RTM today. I hope it helps explain a few things going on from my viewpoint. Also tomorrow I will be hosting a live Q&A session for members at noon ET.
https://www.youtube.com/watch?v=yUq9KmgNsIw
So it turns out that yesterday was just a Vanna squeeze, with implied volatility dropping sharply, ramping up stock prices. The VIX started falling at 2:02 and never looked back. That’s over now.
The S&P 500 futures have an interesting tale of their own. At one point today, they traded at just a touch above their previous intraday high, hitting 4743.25, versus the high on November 22 of 4740.50. It was all downhill from there.
The S&P 500 fell just over 2% from intraday high to low.
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It gets better because the NASDAQ 100 futures traded to a high of 16,457 today, and just above that 16,445 level we have been using as resistance since November 25. It was straight down from there too. The NASDAQ 100 fell about 4% from the intraday high to the intraday low.
Strange price action, very.
Tomorrow will be another exciting day with S&P 500 options expiring on the open along with stocks on the close. Maybe the market makers will try to get the S&P 500 back up towards 4,700 to salvage that strike price. But once that gamma comes off the board tomorrow, I think you will see more of today’s actions. As I have said for months reducing QE is tightening because financial conditions tighten. I track a number of spreads used in the Chicago Fed National Financial Conditions Index, and based on that, tightening has continued this week.
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Apple (AAPL)
Apple fell sharply, giving back all of its gains from yesterday, and has a lot of gaps to fill at lower levels. I love Apple, I own it, but this thing needs to come back to around $165. It is just way overbought, and the gamma squeeze has lived its life, but it’s over now.
Nvidia (NVDA)
I think Nvidia is in the same place as Apple, with a gamma squeeze that took it higher and now needs to deflate, with $265 being its support.
Anyway, that’s all
Mike
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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