Stocks May Finally Pivot On August 17, 2022

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Stocks finished the day slightly higher after giving up some decent-sized gains. The S&P 500 traded as high as 4,325 which came within 1 point of the 200-day moving average; this should trigger the seller’s waiting algos. The index fell sharply, actually went a little negative. But the index stabilized around 4290 but closed higher by 19 bps at 4305.

In addition to the 200-day moving average, there is a significant downtrend, and the RSI is now above 73. The technicals are very overbought, and at this point, I’m just waiting for the 10-day exponential moving average break, and when it does, I think the sell-off that follows will be pretty fierce.

Again, I still think we see the 3,950 region in the S&P 500, which would now serve as the 61.8% retracement.


Tomorrow is an important day as there will be a VIX options expiration at 9 AM, which should lead to some more free movement in the VIX. Then at 2 PM, the FOMC minutes will be released, which should get a lot of attention. The FOMC minutes are usually a selling new event. It could always be different, but it seems that max dovishness has already been priced into equities, so it’s hard for me to imagine that the minutes could read more dovish. If history repeats itself, tomorrow could serve as a pivot, not for the Fed, but for stock prices.


There are already parts of the equity market that seem stuck. ARKK peaked on August 10 and was unable to participate in this rally. The RSI is very close to breaking its uptrend, indicating that the bullish bias is over.


AMD did not participate in this rally and was stuck around $100 for several days. Currently, the 10-day exponential moving average is supporting AMD. I expect support to be broken and shares to drop back to $85.40.

ServiceNow (NOW)

ServiceNow has tried to break out and, up to this point, failed at the top of its trading channel.

Bitcoin (BTC)

Meanwhile, Bitcoin continues to creep closer to the edge as its price and RSI approach their respective uptrends. This can be important because if Bitcoin breaks, it can work to send a risk-off signal to the markets in general.

Anyway, let’s see what happens tomorrow.


Charts used with permission of Bloomberg Finance LP. This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and representative investment advisor at Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyzes presented by Michael Kramer in this review or market report are solely the views of Michael Kramer. Readers should not consider any opinion, view, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s reviews are based on information and independent research he believes to be reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is under no obligation to update or correct any information presented in his reviews. The statements, guidance, and opinions of Mr. Kramer is subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific results or profits. You should be aware of the real risk of loss in following any investment strategy or commentary presented in this review. The strategies or investments discussed may change in price or value. The investments or strategies mentioned in this review may not be suitable for you. This material does not take into account your specific investment objectives, financial situation, or needs and is not intended as a recommendation that is appropriate for you. You should make an independent decision about the investments or strategies in this review. Upon request, the advisor will provide a list of all recommendations made in the past twelve months. Before acting on the information in this review, you should consider whether it is appropriate for your circumstances and strongly consider seeking advice from your own financial or investment advisor to determine the suitability of any investment. .

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