Stocks Are Falling Ahead Of A Huge Day Of Data
Growth, Long/Short Equity, Momentum, Macro
Seeking Alpha Analyst Since 2014
I am Michael Kramer, the founder of Mott Capital Management and creator of Reading The Markets, an SA Marketplace service. I focus on long-only macro themes and trends, look for long-term thematic growth investments, and use options data to find unusual activity.
I use my over 25 years of experience as a buy-side trader, analyst, and portfolio manager, to explain the twists and turns of the stock market and where it may be heading next. Additionally, I use data from top vendors to formulate my analysis, including sell-side analyst estimates and research, newsfeeds, in-depth options data, and gamma levels.
July 30, 2020
Stocks – MU, GE, DIS
Macro – SPY, QQQ, IEF, COPPER
Mike’s Reading The Markets (RTM) Premium Content – $35/Month or $300/Year
- Fed Paints A Gloomy Outlook
- Bets Pile Up Micron Falls As Much As 10%
- It All About The Fed, And Bets Are For Less Liquidity
- Downward Trend Are Still In Place
- Stock A Bit Weaker – Morning Commentary
- Recent Move Lower Likely To Continue- Midday
- S&P 500 Put Buyers + Dollar’s Gloomy Message
Stocks are pointing lower today, with the S&P 500 futures lower by more than 1%. Meanwhile, Germany is falling by about 2%, along with weakness across most of Asia, which gave back earlier gains.
There will be a lot of important economic data this morning with the big second-quarter GDP print, and initial claims. Estimates for GDP are a decline of 35% annualized, while initial claims are forecast at 1.388 million. Germany saw its second-quarter GDP decline by 10.1% versus last quarter, which was worse than estimates for a 9% drop. Additionally, the unemployment rate came in better at 6.4% versus forecasts for 6.5%.
S&P 500 (SPY)
The significant critical level to watch in the S&P 500 is around 3,200, which gives the index plenty of room, currently trading at 3,220.
The NASDAQ futures are in a tighter spot, with very little room to spare. Should the futures fall below 10,400, the Nasdaq would have successfully broken the uptrend, and that is likely to trigger much more selling.
The 10-year yield is falling to 55 basis points, and that is a technical level as it has served as support multiple times. I fear breaking this level sends yields sharply lower.
Copper prices are essential too, and as long as we stay above $2.87, we should be ok, but a break of $2.87, opens the selling flood gates, and that is bad for the risk-on sentiment.
Micron is sitting on support today around $49.80 with a break of that trigger the stock can decline to $45.50. (Mike's premium content - Bets Pile Up Micron Falls As Much As 10%)
Disney is very close to falling below support at $114.60, which would trigger a decline to around $109.
Boeing is again testing support around $165, with a break of that support level resulting in a decline to $154.
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