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Stocks May Finally Get To Pivot

By Michael KramerStock MarketsAug 17, 2022 03:51AM ET
www.investing.com/analysis/stocks-may-finally-get-to-pivot-200628601
Stocks May Finally Get To Pivot
By Michael Kramer   |  Aug 17, 2022 03:51AM ET
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Stocks finished slightly higher yesterday after giving up some decent size gains. The S&P 500 traded as high as 4,325 to come within 1 point of the 200-day moving average; it must have triggered the sell algos that were waiting. The index fell sharply, actually turning negative for a bit. 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 over 73. The technicals are very overbought, and at this point, I am just waiting for the 10-day exponential moving average to break, and once it does, I think the sell-off that follows will be pretty fierce.

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

S&P 500 Index Daily Chart
S&P 500 Index Daily Chart

Pivot?

Today will be important because there will be a VIX options expiration at 9 AM EST, which should lead to some freer movement in the VIX. Then at 2 PM EST, the FOMC minutes will be released, which should get a good deal of attention. The FOMC minutes have generally been a sell the 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 the minutes can read even more dovish. If history repeats, today can serve as a pivot, not for the Fed, but for stock prices.

SPDR S&P 500 ETF Daily Chart
SPDR S&P 500 ETF Daily Chart

ARKK ETF

There have already been parts of the equity market that appear to have stalled out. ARK Innovation ETF (NYSE:ARKK) peaked on August 10 and has been unable to participate in this rally. The RSI is very close to breaking its uptrend, which signals the bullish bias is over.

ARKK ETF Daily Chart
ARKK ETF Daily Chart

AMD

Advanced Micro Devices (NASDAQ:AMD) has not participated in this rally and has been stuck around $100 for a few days. So far, the 10-day exponential moving average has supported AMD. I expect that support to break and the shares to turn lower and head back to $85.40.

AMD Daily Chart
AMD Daily Chart

ServiceNow

ServiceNow (NYSE:NOW) tried to break out and, to this point, has failed at the top of its trading channel.

ServiceNow Daily Chart
ServiceNow Daily Chart

Bitcoin

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

Bitcoin Daily Chart
Bitcoin Daily Chart

Original Post

Stocks May Finally Get To Pivot
 

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Stocks finished yesterday lower, with the S&P 500 dropping around 1% to a new cycle low, closing at 3,655, which was lower than the June low of 3,666. The move lower followed...

Stocks May Finally Get To Pivot

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Comments (9)
as beri
as beri Aug 17, 2022 10:02AM ET
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Question: what are the yellow dashed/dotted lines? Support/resistance, pivot? Something else? Is the yellow lines representation consistent across all your graphs?
King Agamemnon
King_Agamemnon Aug 17, 2022 9:30AM ET
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166074292244458.jpg
Wrong again Kramer. Watching bears get squeezed is hilarious. S&P will continue to grind up to 4550-4600.
Mario tragik
Mario tragik Aug 17, 2022 8:57AM ET
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Kramer and his followers never learn. Almost feel bad for the poor fellas.
Kris Jay
Kris Jay Aug 17, 2022 8:27AM ET
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good analysis again Kramer.  but Robinhood traders will say "earnings?  we dont need no stinkin' earnings.   We dont have to show you no stinkin' future earnings" and up the markets it will go.
Ross Dre
Ross Dre Aug 17, 2022 6:18AM ET
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How can you look at the charts and all of the economic underlying tension and not see some doom and gloom or at least a market that has ankle weights on? Kramer gets it right again.
Gabor Istvan Nagy
Gabor Istvan Nagy Aug 17, 2022 5:54AM ET
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I think he is right this time. Stocks do not go up forever. The question is how much the pullback will be during the next several days. Also remember: currently the Fed is not market-friendly.
John Berry
John Berry Aug 17, 2022 5:05AM ET
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Man you may be the most pessimistic person on here. Wow
Emre Anlar
Emre Anlar Aug 17, 2022 4:13AM ET
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typical Kramer: doom and gloom
Jörg Holl
Jörg Holl Aug 17, 2022 3:54AM ET
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So pessimistic. Missed the rally?
 
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