The Stock Market Is In A Precarious Spot As Storm Clouds Build

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.

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July 28, 2020

Stocks  – AAPL, AMZN, MU

Macro – SPY, QQQ

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MICHAEL KRAMER AND THE CLIENTS OF MOTT OWN AAPL

Stocks finished the day lower, with the QQQ falling by around 1.3% on the day. The market had been pretty tame all day but then sold-off at days end, as Congress has yet to come up with agreement over the next stimulus bill. Additionally, the Qs managed to fail at a pretty strong downtrend, which helped to accelerate the selling. 

The significant level to watch for the Qs comes at $254. It is where the long-term uptrend from April lies. A break of this uptrend would result in a great deal of damage to the market overall. With the FOMC press conference tomorrow, it could be a huge day. 

As I have been noting since the second week of July, the bearish putting betting has just been building and building in the Qs.

S&P 500 (SPY)

The S&P 500 was not immune to today’s selling pressure, either.  It dropped by around 65 bps. The S&P 500 seems to be in a much safer place than that of the NASDAQ 100. 

More recently we have been seeing the put buying move in the SPY – (Mike’s RTM Premium content – S&P 500 Put Buyers + Dollar’s Gloomy Message)

Apple (AAPL)

Apple did not have a good despite reports that the iPhone launch will occur in September despite reports from last week it won’t. I noted in the midday that Apple did not respond well to the news, and I found that to be very odd. When stocks don’t respond to positive news positively, it means they are going lower, not higher. I don’t like this set up going into results on Thursday. (Mike’s RTM Premium content – Downward Trend Are Still In Place)

Amazon (AMZN)

Amazon now has a downtrend in place, and that is not good news for the stock. Like Apple, the setup looks poor going into Thursday. 

https://seekingalpha.com/author/mott-capital-management/research

Micron (MU)

I noted in an SA article today that Micron stock is seeing some bearish betting and that a drop below $49.80 triggers a decline to $45.50.  Micron’s Shares Are Facing A Steep Sell-Off

That’s all I have the energy for today, I’m drained, and my head hurts from thinking to hard. 

-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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