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MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN AAPL, TSLA
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Well, just as we start getting comfortable the earth shakes, and stocks fall. What was the main reason for today’s sell-off? Maybe it was the sell-off in Hong Kong; perhaps it was the PPI number? Who knows. Perhaps it was just the Algo’s refilling technical gaps left open from Wednesday’s big move higher. It is impossible to know these things. The big question is if there was enough damage done today to reverse the recent rise we have seen in the market since the week of October 29.  I do not think the damage was severe enough to be a rally killer.
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S&P 500 (SPX, SP500)
If we go back to Tuesday, I had noted that level of resistance to watch for at 2,820, and that is nearly where the S&P 500 turned lower yesterday. My only mistake was thinking that support at 2,790 was enough to hold. But at the end of the day the S&P 500 closed at 2,781, so today’s decline despite being painful was a not a disaster. The big test shall come Monday, that is when stocks will get the chance to recover and rise above 2,790.
NASDAQ
The NASDAQ interestingly fell to support at 7,348 but snapped back nicely until it failed at resistance at 7,442. Again, not a disaster, but it will be essential for the index to rise above 7,442 on Monday.
Russell 2000
The Russell 2000 also failed at it resistance level at nearly 1,590 and fell nearly to support at 1533. Again, the sell-off although annoying and uncomfortable was not a disaster.
If you want to spin today’s sell-off in a positive light, we can take a look at two key stocks and see that despite the pullback, they well off their lows and trending higher.
Apple (AAPL)
Apple failed at resistance at $209, and I have recently been looking for a rise to $217. The trend for Apple is still higher, and I still believe that is the direction of the stock.
Amazon (AMZN)
Amazon is also still trending higher despite failing to rise above its downtrend around $1,760. Again, at this point, I do not see any change in the stocks and expect it at the moment to continue its rise.
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[youtube-feed feed=7]Tesla (TSLA)
Tesla continues to piece together some nice trading days. There was some notable call activity today for expiration in December at the $380 strike price. But for now the stock first needs to get over $362.
That is going to be for a rainy Friday afternoon. More this weekend.
-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.
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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.