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August 12, 2020
STOCKS – JPM, BAC, NVDA, C, AMZN, TSLA
MACRO – SPY, QQQ, XLK
Mike’s Reading The Markets (RTM) Premium Content – NOW WITH A 2 WEEK FREE TRIAL
- Rotation Still In Force, Watch Tech Carefully
- AMD’s Overextended Stock Could Drop 7.5%
- For Now, Rotation Trade Is Keeping S&P 500 Afloat
- Waiting – Morning
- Key Guages To Watch For The Week Of August 10
- Earnings Trends Continue To Improve – Positive For Stocks
- Big Levels To Watch – Midday
- The Unwind Of Risk-On Has Started
- Don’t Blink – Morning Commentary Transcript
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN TESLA
Stocks are trying to mount a rebound of sorts this morning, but one should be skeptical. There hasn’t been much that h
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.
as changed overnight. The dollar has remained mostly unchanged, and the 10-year Treasury remains a bit higher around 68 bps. This morning we get CPI at 8:30, which could push yields around like PPI yesterday.
S&P 500 (SPY)
More importantly, the S&P 500 futures are trading higher by 52 bps this morning, getting a boost around the 2 AM eastern time frame. It likely means that we are looking for a gap higher at the opening, which, as we know, probably means that a gap fill will be what follows. If I were a bull, which I am not at this moment, I would grow more concerned if we’re unable to reclaim all of yesterday’s decline and print a new high today. If yesterday’s move lower was not to be taken seriously, then the bulls should be able to rally the index right back to were it was before the sell-off.
Nasdaq (QQQ)
At least from the perspective of the Qs, the ETF is trading around $268 this morning. The region between $268 and $270 has been a substantial level of support and resistance. As long as the Qs are unable to mount a move above that region, I think that serves as a big negative for the direction of the market overall.
The big questions just how successful any rally attempt will be based on how much technology names can rebound. Remember, technology is the most significant component of the S&P 500. Unless financials and industrials can continue to put up significant daily returns, then any rally attempt without technology is likely to fail.
Technology (XLK)
The XLK chart suggests the selling in Tech isn’t finished just yet.
Amazon (AMZN)
Amazon is one of those market leaders that need to be continually watched. As a break below $3000 would likely signal, further selling is on the way.
Nvidia (NVDA)
Nvidia is also a big momentum stock that is approaching an essential support level at $427. That is where the uptrend off the March lows are too. A break of that uptrend would be a terrible signal for the broader health of the market as well.
Tesla (TSLA)
Tesla is rising on the back of its stock -split announcement. I don’t think it changes much in-term of the downtrend it has been. The momentum of the split could push shares higher today, but $1500 is a tough wall for the stock, and I think the stock still needs to consolidate.
Zoom is also looking very weak here, with a drop below $227, triggering further selling to $200.
Citigroup (C)
Citigroup got to significant resistance yesterday around $55 and failed.
Bank of America (BAC)
...As did Bank of America at $28.
JPMorgan (JPM)
…And JPMorgan around $105.
Have a great one!
-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.
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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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