Stocks Rebound On February 3, But A Downtrend Is Now In Place

S&P 500 (SPX

Stocks moved higher on February 3, with the S&P 500 rising by around 70 basis points back to 3,246. But not is all good news because it would appear that a bearish downtrend has formed. It will be essential to see what happens from here, do we fail at the trend line or break higher. My suspicion is that we know more tomorrow, one way or another.

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S&P 500, spx

ISM Report

The ISM manufacturing report came in today, and it showed an improvement in the sector with a better than expected reading of 50.9%. More critical is that it corresponds to a GDP growth rate of 2.4%. Additionally, GDPNow is forecasting first-quarter GDP growth of 2.9%.

Netflix (NFLX

Netflix is higher today and is very close to $362 now. That is the big level of resistance we have been waiting for. It is simple, breakout, and we go to $385. Remember, we saw the bullish betting in this one last week, and the stock has performed very well during this whole market downturn. 

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netflix, nflx

AMD (AMD)

AMD looks solid and is bouncing back today, rising over $48. The stock has done a fantastic job holding the trend line and support around $46.80. Going back to $50.50 seems feasible at this point.

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amd

Nvidia (NVDA

Nvidia is looking reasonably strong, too, and is breaking a downtrend at the moment. It could result in the stock rebounding to around $246.

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nvidia, nvda

Intel (INTC)

Intel options buyers are back? It seems possible. The stock filled the post-earnings gap and held support, and it looks like it is going to turn higher. 

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intel, intc

Boeing (BA)

Boeing continues to trend lower, and all the signs suggest it falls back to $297 to $300.

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boeing, ba

Disclosure: Michael Kramer and the clients of Mott Capital own NFLX.

Disclaimer: This article is my opinion and expresses my views. Those views can change at a moment's notice when the ...

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Gary Anderson 1 year ago Contributor's comment

Cure or no cure for coronavirus may be a big part of the answer to stock weakness.