Hey…the Giants won!
We heard yesterday:
One pundit say the action in the market doesn’t worry him a bit.
One pundit say this is how a bottoming process works.
One pundit say it is good news when they get names like AAPL and GS.
Except for the DOW, all major indices and most countries trade below the longer-term 200 day moving average with many trading way below.
Many “death crosses” are now occurring. That’s where the 50 crosses the 200 day…a sign of even more weakening conditions.
Some of the 200 day averages are now turning down indicating price staying below longer.
Leadership remains defensive and few and far between.
Growth continues to act horrid.
Good news is sold. Bad news is sold hard.
Recent strong gaps to the upside off of earnings have been sold.
We do not need to predict. We deal with the evidence and facts at hand.
Markets are probably a little short-term oversold off of the recent drop…not sure what that will mean. Notice the NASDAQ/NDX failed in and around the 200 day average late last week. That must change.
As we write this now, futures nicely down. LITE just warned and warned badly. The stock is down over 30% in pre market:
Lumentum cut its fiscal second quarter earnings and revenue guidance sharply today, saying one of its largest Industrial and Consumer customers for laser diodes for 3D sensing requested Lumentum materially reduce shipments to them for previously placed orders scheduled for delivery in Lumentum’s fiscal second quarter.Per Lumentum’s 10K filing, Apple (AAPL) was the company’s biggest customer in fiscal 2018, accounting for 30% of total net revenue. Huawei accounted for 11.0% of total net revenue, as did Ciena (CIEN). It will be assumed that Apple is the customer in question. Accordingly, look for a trickle down effect in Apple supplier stocks today. AAPL is down almost $5 this morning on the news. Not helping futures with NDX futures down decently.
WE WROTE THIS YESTERDAY ON OUR WAY BACK HOME!
Futures down a wee bit after a strong day yesterday.
It is 715 am here in Brussels, Belgium. Happy voting day today.
Our prediction is that the Reps keep the senate but the Dems take the house with the Dems doing better in the house than expected. We think Trump and the Reps missed a tremendous opportunity in past weeks highlighting the economy but instead decided to go immigration. We think Trump should have gone on a “nice” tour instead of continuing on his “fake news” and all that crap tour. We talked about the national media fake news before Trump was even political Trump…but there are times to slow the roll.
O course, we can be wrong…and hope we are. These Dems are left of left, void of any “people” ideas. Instead it is all about what government will do for you…but this government is nothing more than an out of control, debt and deficit blob. Trillions have been inefficiently and ineffectively spent, taken out of the hands of tax payers in the name of poverty and the poor. Instead, maybe 25 cents on the dollar goes to work. How do we still have poverty with so many trillions spent?
Anyway, no matter what, the sun will come out the next day. The people are still bigger than any damage the government can do (we think) and if Dems win, they will just F up the next 2 years…ensuring Trump wins in 2020. They are that bad. They will spend two years on impeachment and investigation after investigation because they have no other ammo. The masses will get pissed and then 2020 comes along.
All Monday, we were saying the DOW had better keep rallying because again, growth was hit. You see the final numbers. We do not think the DOW leading and NASDAQ lagging is a good thing. Heading to Vienna now. Will report back to you tomorrow.