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Michael Kramer and the Clients of Mott Capital own Tesla
What could have been a disastrous trading session turned into a win in my book. Stocks gapped higher to start the day, only to sell-off hard midday, and then rally sharply back to finish the day slightly higher. To some, it would seem like just a choppy session. What I see are buyers stepping in and the sellers failing to crack the market. A few weeks ago, this would have likely turned into a bloodbath, but something has changed among investor sentiment.
S&P 500 (SPY)
How many times did we see this occur in December with a gap higher at the open of about 50 basis points, only for the market to give back all the gains by lunchtime and then drift lower for the balance of the day? But this time, the S&P 500 fell nearly 1.5% from peak to trough intraday, only to rebound. What seems particularly impressive about today’s price action is that it follows a steep decline on Tuesday.
Technology (XLK)
More interesting was the pattern in the technology ETF (XLK) which managed to retest yesterdays lows around $63.75
Consumer Stocks (XLY)
We can see the same pattern that took place in the discretionary ETF (XLY) as well.
Amazon (AMZN)
Amazon has nearly the same pattern as the XLY, which should not be a surprise given its 23.4% weight in the ETF.
Tesla (TSLA)
Tesla fell sharply today on a downgrade by RBC and some negative reports about last weeks layoffs. I went through my thoughts in more detail in the premium area article Tesla: Why The Big Drop? But here is a summary:
The cynical side of me sees this only as the short sellers taking the opportunity to drive the stock down. Everyone knows that the company has a bond maturing in a couple of weeks with a conversion price at roughly $360, and if the stock can stay below $360 then that means Tesla will need to pay the debt off with cash on the balance sheet. That would cut their cash on hand. Blah Blah Blah. You can fill in the blanks.
So hey, the stock continues to rise and fall based on the activity of the short-sellers.
I’m not pleased that the stock fell below support today $300, but if it can manage to rise above $300 tomorrow, then no damage was done. If it stays below $300 then it has a better chance of falling back to $260.
Lam Research (LRCX)
Look at that; semiconductor stocks can go up?! Lam Research is jumping after reporting better than expected earnings and revenue. Additionally, the company gave pretty good guidance. Why do we care? because Lam makes the equipment that companies use to make the chips, so when they do well, it is because other chip companies are doing well. Lets keep our fingers crossed.
The stock is trading above $150, and it could send the stock higher to $157.50
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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.
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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.
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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.
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Intel (INTC)
Tomorrow Intel will report results, so we will get first hand just how the chip stocks are doing. The stock has gone nowhere since November, and it would seem it that stock can not rise above $49. I do think that changes after tomorrow’s results with the stock rising back to $52.50, although, this, not the first time I have felt this could happen. It will take a strong earnings report for the stock to get over $49. But I think it does. This is a free article previewing the results I wrote.Â
Banks
The bank’s stocks have paused over the past few days as we expected to happen. Now the BKX is on the verge of a big break out or significant pullback. The RSI suggests momentum is going the right way, that would suggest a rise above 97.25 may be on the way.
That is it
Mike
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Mott Capital Management, LLCÂ 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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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.
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Mott Capital's Market Chronicles January 10, 2025 12:02 PM