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The S&P 500 finished down around 13 basis points, while the Qs gained back some of yesterday’s losses, rising by 40 bps. Not much really changed from a technical or fundamental standpoint today. There was no news on stimulus today despite initial jobless claims rises by more than expected.
The setup in the chart continues to look rather bearish to me. Here are the S&P 500 futures, and there is clearly a rising wedge, and at the very least, we are testing an uptrend. A break of the uptrend sets up a retest of an uptrend around 3,350, with the potential for something far worse. A 68% retracement of the pattern in a correct wave takes it as far as 2,750.
The RSI in the Futures already broke, and volume has picked the last few days. (premium video – The Calm Before The Storm – Video)
Navigating The Market · By Michael Kramer Independent macro and options research, published every trading day. Daily written analysis covering gamma exposure, dealer flows, key levels, and the macro drivers moving markets. Includes full video access. Recent Subscriber Analysis
Amazon (AMZN)
I think the triangle pattern is complete Amazon, and it is now on support at 3,100. A break at support sets up a push down to $2800.
Broadcom (AVGO)
Broadcom reported results, which were ok. Probably not good enough for the move up the stock has seen. Like I said in my predictions for the week article, I think the stock heads lower, and a break of $400 sets up that decline to $372 I was looking for. Good thing I do my own work.. :P****
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Adobe (ADBE)
Adobe reported results today, and they were good, but the stock didn’t care. The shares are now on support at $474, with a decline to the lower end of the trading channel coming.
Semis (SMH)
It is hard to find a sector more overvalued than the Semis; with the SMH now breaking the uptrend and an RSI that reached way overbought, Broadcom will not help either. A drop to $183 would be nothing.
Anyway, that’s all for today. Sorry for the delay.
-Mike
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