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Stocks had another dull day, with the S&P 500 finishing up 29 bps. A lot of that came in the final hour of trading. There is not much to report here on the S&P 500. We are just consolidating, and you typically continue in the previous direction after consolidation. So I don’t see any reason to think differently about my 3950 level.

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2-Yr

The 2-yr made a very big advance today and is now trading around 3.4% and is close to making a new cycle high. The 2-yr reflects the more hawkish outlook of the Fed Funds and Eurodollar futures. There is little resistance for the 2-yr once it gets above 3.45% until it reaches around 4%.

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Nvidia (NVDA)

Nvidia reported some horrible results and gave even more atrocious guidance. Analysts were looking for revenue in the fiscal third quarter of $6.9 billion, and the company gave guidance for $5.9 billion, a miss of almost 15%. I can’t understand now how this stock is only down 3.9%. You can’t even say the guidance miss was priced into the stock because it hasn’t moved since August 8, basically trading sideways. We will see where it will trade tomorrow, but I think this stock will go down significantly if not make new lows. A 15% drop would take the stock down to the low 140s, and I don’t see why that isn’t possible.

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AMD (AMD)

I think the future holds the same fate for AMD as well. There is a double top on AMD, and it should push the shares back into the low to mid-80 region.

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Salesforce (CRM)

Salesforce is down almost 6% after guiding third-quarter revenue to $7.82 billion to $7.83 billion, versus estimates of $8.05 billion. Salesforce also guided earnings to $1.20 to $1.21 versus estimates of $1.29. So, in my opinion, Nvidia results are multiple times worse than Salesforce, yet Salesforce drops sharply, and Nvidia hardly moves, again making zero sense. The critical level for Salesforce for a long time has been around $165.

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