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Markets Remain Under Pressure

By Michael KramerStock MarketsOct 03, 2022 03:32AM ET
www.investing.com/analysis/markets-remain-under-pressure-200630559
Markets Remain Under Pressure
By Michael Kramer   |  Oct 03, 2022 03:32AM ET
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US500
-0.16%
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QQQ
-0.76%
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GOOGL
-0.90%
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TIP
-0.43%
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TSLA
-1.14%
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Stocks fell sharply on Friday, with the S&P 500 down 1.5% and 2.9% for the week. It left the S&P 500 trading at a new 52-week of 3,585.

The RSI is back below 30, but the technicals look pretty bad on the S&P 500, and it seems possible at this point that we may have started a wave five down.

It would seem that the S&P 500 has finished a period of consolidation, which could result in the index dropping to about 3,500. However, if this is the start of a wave five lower, we could see the index decline to around 3,200, which would also be around the September 2020 lows.

S&P 500 Index 1-Hr Chart
S&P 500 Index 1-Hr Chart

QQQ ETF

The QQQ is not all that different, with short-term support of around $260. If this is the start of a wave five down, it could result in the QQQ falling back to its pre-pandemic highs of approximately $237.

QQQ Daily Chart
QQQ Daily Chart

QQQ Vs TIP Relationship

While there is no perfect way to measure the relationship between the TIP ETF and the QQQ, at least based on a ratio, we can tell that the QQQ hasn’t completely caught up to the TIP yet. The ratio of the QQQ to the TIP is currently 2.55, and it had been at 2.37 at the June lows. This tells us that the QQQ still needs to fall further, and with the TIP trading at $104.90, the QQQ probably needs to fall to around $248 to bring that ratio back to the June lows of 2.37.

QQQ/TIP Ratio Daily Chart
QQQ/TIP Ratio Daily Chart

Shopify

Shopify (NYSE:SHOP) still has its RSI trending higher, and as long as the RSI is trending higher, it gives me hope that there is a momentum shift from bearish to bullish occurring. No, the technicals do not look great, with the stock flirting with breaking a downtrend, but again as long as the shares can hold that trend line and the RSI can remain upward sloping, I think the stock is still in a bottoming process.

Shopify Daily Chart
Shopify Daily Chart

Tesla

Tesla (NASDAQ:TSLA) has surprisingly held up very well throughout most of the carnage, and the company should be announcing third-quarter deliveries today. But upward momentum is broken. The stock has stalled and fallen below an uptrend, leading to the stock falling to around $246 and filling the gap.

Tesla Inc Daily Chart
Tesla Inc Daily Chart

Alphabet

Alphabet (NASDAQ:GOOGL) has struggled and has fallen below support at $95. While the stock doesn’t look great over the short-term, the long-term outlook remains strong, in my opinion, and so even if the shares should fall back to, say, $83 and fill the gap, I do not think the long-term prospects have been damaged.

Alphabet Inc Daily Chart
Alphabet Inc Daily Chart

Meta Platforms

Meta Platforms (NASDAQ:META), on the other hand, in my opinion, is in a very different position, and while this stock is breaking down and could even be heading back to its 2018 lows of $123. The longer-term outlook is not strong, given the increased competition from Tik Tok and Apple (NASDAQ:AAPL) privacy headwinds. I have never liked Meta because these social media platforms tend to be faddish, and while those fades can last for years, they are always just one new competitor away from becoming obsolete; look up MySpace and Friendster.

Meta Platforms Daily Chart
Meta Platforms Daily Chart

Original Post

Markets Remain Under Pressure
 

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Markets Remain Under Pressure

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Comments (3)
Mario tragik
Mario tragik Oct 03, 2022 1:10PM ET
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Hey Krameeer and his blind followers, come out come out wherever you areeee. how are my favorite doom and gloom ppl doing? how is that selling the lows because stocks should fall more going along?
Logan CALDER
Logan CALDER Oct 03, 2022 1:10PM ET
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You are really funny....It goes up 3% and you gloat. The facts are, if anyone followed your advice the last 3 months they would still be way down, as you are....enjoy your 1 day....everyone who reads your notes understands how wrong you have been....and BTW, nobody with brains blindly follows any analyst.
Mario tragik
Mario tragik Oct 03, 2022 1:10PM ET
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Im a day trader son, so I don't care what happened 3 months ago, last trading session maybe i care a little but thats about it. what, u think im holding stking bags from months ago? you are the funny guy my dear perma bear.
Logan CALDER
Logan CALDER Oct 03, 2022 1:10PM ET
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Yes, i do think you are holding yrash, but im really just pointing out how you keep saying Kramer is way off when he has been consistently right the past several months. Day trade away, I do as well, but you should have the ability to admit you have been very wrong, while Kramer has been very right, at least the last few months.
Mr Doodl
Mr Doodl Oct 03, 2022 8:42AM ET
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I don't agree with shopify prediction. The price has drawn a small H&S pattern during consolidation and it has been completed with a price target of 19,75$. RSI is pointing downward again.
Mario tragik
Mario tragik Oct 03, 2022 8:04AM ET
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ladies and gentleman here is your greatest jokester .... kramaaaa da c. l0 w. N
 
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