Stocks are falling in the pre-market, with the S&P 500 ETF pointing to a decline of about 2.2%. Most of Europe is closed today, and at least on the surface, it seems like the market is responding to the weak earnings reports, and from some comments that I heard from President Trump about China, the virus, and the use of tariffs.
Don’t forget you get the ISM Manufacturing Report at ten AM. That should be interesting.
S&P 500 (SPY)
The index is falling outside of the rising wedge, as I noted yesterday, and that could spell bad news for the market and the big run-up in April. The next meaningful level of support comes around $280. We are also well below the Volatility Trigger zone on the SPX, around 2,850. This is a topic we talk about a lot later.
NASDAQ (QQQ)
The Nasdaq Q’s are falling outside of the rising channel for the first time since the March lows. Depending on where the NASDAQ closes, this could be an extremely bearish indication. More importantly, that bull rally you saw since the end of March is over.
If you think it is not possible, go back and check your history charts. Hint – start in the year 2001.
Amazon (AMZN)
Amazon is falling today, and that $2,440 region has been brutal for Amazon. Factor in the news that the company is going to spend a lot, and the 6% of the May 1st morning starts to sink. The stock still potentially has further to fall back, perhaps back to around 2,180.
No one should be surprised by this, as this is how Amazon operates; spend, spend, spend. In the past, it never mattered because, in the long-run, the spending is positive; but that was then, this is now, and investors ran to this as a safe-haven trade. But it is not working out as planned.
Apple (AAPL)
Apple is falling some after reporting weak iPhone sales. I wrote this article for Forbes, as I think the stock is range-bound between $260 and $295.
Netflix (NFLX)
Meanwhile, I think Netflix will continue to move lower and head towards that $386 level. Didn’t I tell you last week, to use Netflix as a proxy for Amazon?
Nvidia (NVDA)
Nvidia is falling today too, and I still think this one is going back to $245, and maybe $218. Have you noticed that the stock tops out the same price all the time?
Microsoft (MSFT)
I still think Microsoft is heading back to the $161 to $165 range. I said it would fall, following results to that level. I never said it would drop the very next day.
Qualcomm (QCOM)
Again, I think Qualcomm will fall to $65. Like Microsoft, never did I say anything about the day after earnings. Patience is needed sometimes. Instead of being impulsive, let the stock’s price action tell you the direction.
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