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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What is Next for Tesla, JP Morgan, Apple, Acadia, Micron, and Facebook
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN TSLA, ACAD, AND AAPL
I’m worn out today, to be honest. The bad news is that today is only Thursday, and I work my hardest over the weekend. So tonight’s blog will be a short one.
By the way, here is a follow-up subscriber video building off yesterday’s commentary. I get into more detail here. Here Is Why Equity Prices Are Poised To Rise Further
By now everyone has heard about Tesla, it is on the home page of every financial news site. I have no words of wisdom on this one. I read the docket; I watched the press conference. Now there is word late tonight that Musk could have settled, and his lawyer pullout of the deal at the last minutes? So bizzarre!
But regardless, we can use the chart to gauge levels of support like we always do, to get a sense of how far it could fall. The stock had recovered nicely from its last free fall in August, and it even appeared to break out just yesterday. But that is all but gone now. Support is now is around the $250 level. If the stock falls below that, it could get much worse in a hurry. The next significant level of support comes around $180.
Yes, I know charts do not always work when there is fundamental news, but at least you can start thinking about and planning for what-if scenarios.
JP Morgan (JPM)
A Twitter user asked to check out JP Morgan. I guess my following is growing to other social media platforms. I do not like the banks; I think I have made that fairly clear over the months.
JPM failed for the third time around $120, maybe it is the fourth time upon a closer look, and that is bad news in my book. That long green line I have on the chart is an uptrend line that has been in place since November 2016. If the stock falls below that green line, which we can say is around $113, that is an even worse sign because that means the long-term uptrend is broken.
The RSI is still trending lower, despite the stock reaching its earlier highs, and that bad news too, because that is bearish divergence.
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Then, of course, there is flattening yield, decelerating earnings and revenue growth.
Apple broke out today, and the trends continue to suggest shares rise further. Ironically, JP Morgan initiated coverage on Apple today with an overweight rating and $272 price target. They see Apple transforming into a service company. Gee, where have we heard this discussion before? Maybe on this blog? Like this article, I published Why Apple’s Stock May Soar By 50% Over The Next 2 Years.
Micron’s stock continues to struggle around the $45.25 to $45.50 range.
Acadia continues to rise, and it cleared resistance around $21.50. It would be nice if the stock just took a break here and consolidated. I do think there is more upside with the next level of technical resistance around $24.
Facebook finally broke above resistance around $166, and there is a good chance it runs to around $186.
Anyway so much for being a short post.
Good luck tomorrow.
Michael Kramer is the Founder of Mott Capital and the creator of Reading the Markets.
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.
TSLA, JPM, AAPL, ACAD, FB, MU