9/18 Recap

Semis got a big warning overnight and sold off hard this morning. They did recover with many making really big moves up to turn green. We also heard more concerns about the consumer today and the consumer discretionary names sold off. Amazon and Tesla lead that group. I’m not so sure Amazon is as consumer discretionary as people think, people shop there for convenience, if anyone there was actually worried about saving money they’d just use Costco or Walmart. So like Apple, I think the bulk of Amazon consumer spend is from people who are not impacted by macro concerns. Look at Dollar General stock, it is down over 60% this year, that is the consumer who is hurt by all those things like inflation and rates.

Speaking of rates, they kept ticking up today with the TNX rising over 43 and the VIX was up over 7% at one point but sold off. Higher rates are really weighing on the pricier “growth” names. Along with that, oil just continues to rip higher every day and is now up almost 35% in just a few months which has led to many companies, mainly airlines, already warning investors by guiding down recently.

The SPY remains weak under the 8 ema on the daily, on the weekly chart below you will see that we are in the same spot we were in early June. It’s been months of no progress. The real winner has been the put sellers. We still remain ominously close to finally breaking that uptrend we’ve been in, the macd has already rolled over, the RSI is showing distribution, but we continue to bounce right where we should every time. We will have to keep an eye this week as we’re less than 1% away from breaking down.

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