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8.29.24
#MACRO: $SPX, $NDX, $VIX, $10Yr
#STOCKS: $NVDA,
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- RTM: The Final Act?
- RTM: Yield Curve Steepening Continues
- RTM: Bulls May Be Too Optimistic On Broadcom’s AI Prospects Heading Into Earnings
- RTM: Long-Term Cycles Are Calling For A Major Market Top
- Live Sessions To Restart 9.6.24 At 8:15 AM ET, For Job Report
- RTM: Market Volatility Follows Powell’s Speech
- Ueda And Powell Come Tomorrow
Well, it looks like yesterday’s implied volatility ramp higher came back to bite the market today. The early IV crush in the VIX 1D went from 21 to 11, sending the S&P 500 surging by almost 1% to start the day. But by day’s end, it was all gone, with the index closing the day flat, at 0%.
The NASDAQ 100 finished the day down 13 basis points and dropped about 1.5% from its highs of the day in the final hours of trading.
They tried for a second day to get over resistance at 19,475 and failed again. All the Nasdaq needs to do tomorrow is to fill the gap lower, below support at 19,250, and probably on its way to filling the gap from August 24 at 19,000.
In addition, despite all the hype at the start of the week about the billions a day that Systematic funds were supposed to buy, the price action hasn’t been awe-inspiring yet. Looking at the MACD, with a 20 and 120 value, it almost seems as if they might have to start selling again if the S&P 500 begins to move lower.
I don’t think today’s afternoon sell-off had to do with tomorrow’s PCE. The VIX1D closed the day under 13, down from yesterday’s close of around 21. So, today’s decline had more to do with the morning’s IV crush fading away as normal trading took over, and Nvidia sank to the lows of the day.
The selling in Nvidia was on autopilot for almost the entire day, a slow mechanical move lower. Then, around 2:30, the sellers decided to stop messing around and took Nvidia down.
Nvidia managed to close on technical support around $118. However, breaking that level could lead to a further drop to around $110. It is also back below its 50-day moving average and below its 10-day exponential moving average.
Meanwhile, the 10-year rate seems to be waiting for either the PCE report or the job report next week, but this level at 3.8% remains incredibly important. A break of support could likely trigger a much steeper drop and, more importantly, another move lower in USD/JPY.
-Mike
Charts used with the permission of Bloomberg Finance L.P. 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.