9/11

I still remember where I was standing, what I saw, how I saw it, what I said. Another plane hit. My exact words yelled out: “IT’S A F—ING TERRORIST ATTACK!” I remember the drive home. I remember the whole day. I remember the next few days as the market was closed. I cannot believe it has been 17 years. This is one of those events that feels like yesterday. The stories of courage of heroes going back into the buildings. We can never forget. I never forget.

Futures down this morning but this morning…really don’t give a crap.

WEEKEND AND PRE MARKET

Even with major indices just off highs, there is a ton of weakness. We are seeing HOUSING breaking down from low levels, continued weakess in GAMING, GOLD/SILVER, STEEL, COMMODITIES, SEMI-EQUIPMENT which is being blasted, DISK DRIVES, HOTELS, AUTOS, a few select RETAIL showing some tops, a ton of OILS, all the other countries and areas we have been telling you about. Just go take a gander at EEM, EFA, FXI, RSX, VWO, IEMG. On top of that, saw more new lows than new highs most of last week. On top of that, past leaders like FB, TWTR and even GOOGLE now breaking the 50 day. Less than thrilled that the AMTD, ETFC, SCHW now rolling over, very often market proxies.. Let’s add in the BOND MARKET may have topped. (TLT) And may we say lastly, we are hard pressed to find good chart set-ups except for (ready for this) some big cap DRUG, CONSUMER STAPLES and other defensive areas. Lastly, don’t know how to even start talking about Tesla…glad we laid off.

The good news is that our proprietary list of growth names continue to be a port in a potential oncoming storm but even some of those names like AAPL, AMZN and others came in decently. We can all but guarantee if the market comes after this growth list, then something is up. Other areas that act well are MANAGED CARE, RAILS, select RESTAURANTS, select RETAIL but again, leave no doubt, the herd has been thinning out. More thinning would not be a good thing.

The good news continues to be major indices have hardly budged with any pullback contained. Until that changes, it is folly to get too bearish. Just realize this in no way is a “throw the darts” market.

Lastly, very speculative and ridiculously priced marijuana stocks have been the recent “buy at any price” froth area. One name (TLRY) has a $7 billion market cap with just over $20 million in sales and is even down 15% off highs. We will have no problem probing new technical set-ups as fads can pay off in the short term but word to the wise, if you buy them ridiculously extended, you are in for a world of hurt when they decide to come in so pick your poison correctly.

For no reason, futures gapping up this morning. Again, any pullbacks are contained. Usual growth names up in pre-market.

Very slow earnings week. ADBE and ORCL on Thursday.

PRE MARKET

Not a good day yesterday for TECH/INTERNET/SOCIAL MEDIA.

Names like FB, GOOGL, TWTR act poorly. They are a tail wind for market for a long time. On top of that, even AMZN and AAPL now pulling back. On top of that, poor action in TSLA and NFLX not helping. TSLA down another $15 this morning as Chief Accounting Officer Dave Morton provides notice of resignation effective immediately. He just joined August 6.

So…beta changing up some here but it is not just that. For a while we have been telling you how almost half the market not participating and every time we get weakness, they just worsen. Yesterday, SEMI EQUIPMENT was smacked even worse. Go look at KLAC, AMAT, MKSI, LRCX. MU also hit. Worry about pricing.

Also and to repeat for the hundredth time, EMERGING MARKETS, RUSSIA, CHINA, BRAZIL, TURKEY, EAFE and many other areas around the globe…from ARGENTINA to GREECE…all acting poorly. The U.S. market is so much stronger than the rest of the world. There has to be the question on whether we get dragged down.

Other areas in poor shape are HOUSING, GAMING (squashed), OILS, GOLD/SILVER, COMMODITIES, AUTOS, HOTELS and can now add bad patterns in BROKERS AMTD, SCHW, ETFC, a few RETAIL names like AEO, FL, ANF, GPS, M, URBN…though there remains a good number of nice RETAIL patterns.

Just know some issues showing up for the market, namely the big megacap narrow leaders in TECH/INTERNET/SOCIAL MEDIA.

Futures down decently even though employment numbers look decent. FIVE, OKTA, MRVL, PANW gapping up.

TSLA gapping down…

NASDAQ/NDX

By Gary Kaltbaum-
We write this and actually disclose who we are.-
The NASDAQ/NDX has been very strong in past months off of a select few mega-cap names. Earnings come out in droves in a few weeks but:-
FACEBOOK gapped down recently on potential for slower growth. On top of that, Facebook has put themselves front and center into the regulatory cross hairs. Mr. Zuckerberg did himself no favors in his testimony. Sheryl Sandberg did a much better job. The bigger issue will be their numbers going forward. A recent story in the NY POST highlights millenials not so thrilled with the company.-
GOOGLE stock has dropped about 90 points in recent days as the president ratcheted up his rhetoric on the company. We think it not smart that no one showed up yesterday for testimony. (Notice they were able to get yesterday’s hearing on the same day as Kavanaugh. Otherwise, would have been front and center.)-
TESLA stock continues to suffer…down almost 33% from the fake buyout price. That’s a measly $22 billion below the fake buyout price. We told everyone on radio and tv not to go near the stock.-
NETFLIX also had a poor reaction to earnings. It just bounced up to the 50 day, where it sold off hard yesterday. Worries about costs as well as more and more competition not helping the stock.-
These 4 stocks had been an important cog in the wheel on the upside but no longer. The good news is that APPLE and AMAZON remain very strong, though we think they started to pull back yesterday. If ever these stocks get taken out, look out. The NASDAQ, particularly the NASDAQ 100 have done quite well with these select few carrying a ton of influence. We also want to add that SEMI-EQUIPMENT MAKERS continue to be on the very defensive. Names like LRCX, AMAT, KLAC, MKSI, ASML and others acting like the south end of a north bound jackass. The 50 day moving average has held the NASDAQ 3 times recently. It currently sits at 7818…the NDX at 7366.-

PRE MARKET

We saw a day like yesterday on 6/25 and 7/27 only to see NASDAQ hold at the 50 day average within pennies after a little more downside. We just know yesterday was another scare day where growth leaders took it on the chin. Some reversed a lot, others stayed near lows.

The good news behind any weakness in the indices is that it is easier to isolate the real strength. The names that hold up best will usually lead when any correction is over. Can it get worse? Of course it can. Use the 50 day average as it has held 3x in the past few months.

The biggest issue we continue to have is the real weakness in global markets as well as global currencies. The U.S. market continues to outperform by some of the widest margins we have seen in  a long time. It is not out of the question that the U.S. market follows them but so far, not even close to happening.

Futures up a wee bit this morning. And we do not care that it is September.

 

PRE MARKET

U.S. markets came back nicely yesterday but today, we accentuate the negatives. That does not take away from the great action of growth names or anything marijuana but:

Have you seen:

Russia, China, Brazil, Turkey, emerging markets, EAFE, other currencies, the German Dax, the London FTSE, Paris CAC….and so many other areas.

We will just say we think it a miracle the U.S. market is not reacting to what we are seeing in many other parts of the world. Let’s hope that continues. We keep thinking the rest will rally…but ain’t happening. The HANG SENG another bad down day, Europe weak again.

We pay attention but so far, the U.S. is immune.

Futures are down but way off the overnight lows…and AMAZON now a $trillion company.