Scott Redler All-Access Morning Note – June 3, 2019

War Games – June 3, 2019

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Morning Call: June 3, 2019
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By Scott Redler

We have mostly red arrows around the world as fears over trade wars and slowing economies send most regions to multi-month lows. President Trump added Mexico to the trade war and now there’s talk about Australia too. In Europe, the DAX is -0.2% but off morning lows. The CAC is -0.3% and the FTSE is -0.5%.

In Asia, the Nikkei is -0.9% with the Shanghai -0.3% and Hang Seng flattish. There’s a small glimmer of a softer tone heading into the first G-20.

SPX futures are -9 and off the overnight lows to start a new week. The active trend broke at 2913 in Early May. Now we’ll see if the 2703-2722 area gives an active bounce with opportunities. 2650 is the measured move of the H&S pattern that triggered when we broke 2801 last week.

Today, we’ll see if we reclaim last week’s low of 2750 to relieve some pressure. I’d much rather see 2703-2722 first, but we'll see how the morning trade unfolds. Resistance is 2768-2784.

SPY made a low of $275.24 Friday. We’re below it this morning but it's off the lows. We’ll see if that gets reclaimed or if we see the $272.40 area this morning. Bigger resistance is in the $276.70-$277.20 area.

QQQ’s broke the 200 day Friday with a low at $173.87. We’ll see if we reclaim that. Then the 200 day is above at $174.40. A close above that area relieves some pressure. $171.85 is important support below.

Small caps broke below the big channel with multiple ways to sell strength or play short. IWM has Friday’s low at $145.32. See if that gets reclaimed this morning, or if it continues lower.

Banks hit monthly lows on Friday. The only time to trade these from the long side is on extreme pullbacks. Yields have been a big problem here.

JPM has Friday’s low at $104.84. I’ll see if it can be bought against that this morning for a scalp to go green.

BAC made a weekly low at $26.48. See if that holds this morning.

GS made a weekly low at $182.31. That is the pivot to start the week with.

Oil and energy remain under pressure. This group broke lower first, giving clues to bring risk down.

USO’s low from last week is $11.04. Watch that today. It’s up a bit this morning.

XLE is broken but watch last week’s low at $58.77. Maybe there’s an oversold bounce vs. that level.

The Go To List names lost special status many weeks ago. That Sunday Tweet from the President changed the market complexion. Using the 8/21 day to get out could have saved you a lot of money.

When those levels break, we get tactical and look for both long and short trades, or even just wait for names to rebuild. Lots of stocks went from bent to broken with many F.A.N.G. names closing on the lows Friday. Some momentum guys took them short. I only took FB short myself.

GOOGL has been very broken since missing last quarter’s earnings. Antitrust news hurt too. It’s off -3% this morning. This down open is probably not worth pressing. I would watch it for sentiment. If it puts in a reactionary low in the first 5-15-30 minutes and rallies, it might help sentiment.

AMZN lost special status as it broke the 8/21 day up around $1855. Then it broke below the $1804-$1807 area on Friday with a low of $1772. I'd cover some. There is some support to see how it reacts around $1745. If the market wants an oversold bounce, that needs to hold.

FB broke the $180 area and it lost special status last month. I took it short and covered some around $176. If it tries to reclaim the $177.16 area, I’ll probably get out.

NFLX is interesting here. It’s not special and it has a huge channel that might break to the downside. If it gets and stays below $342, some will press shorts and it can see the 200 day fast near $337.50.

AAPL made new May lows on Friday. It has the WWDC event this week. There’s opportunities into weakness each day but we have to be careful. There’s a gap to fill down to $173. See if it reclaims Friday’s low at $174.99 or stays below. $168.50-$170.50 is very big support.

TWTR still acts better than most names. I sold mine a few weeks ago as it lost special status. I’ll see how it reacts around $36.30. There is a big gap to fill down to $35 if it gets and stays below.

ROKU tries to act special but in this market you need to be careful with names like this. $87.80 needs to hold to keep it looking good. If that area breaks, I’d get out.

TSLA is still a broken battleground name. Last week’s low is $184.10 which is key this morning. I have leftover options that will probably be worthless on Friday.

Semis are getting attention with Infineon buying CY at $23.85.

SMH has last week’s low at $97.61 to watch.

INTC didn’t make a new May low late last week, so maybe it’s ready for a bounce here. Some are in vs. $42.86. If it gets and stays above $45, it might help tech.

QCOM is not special but it didn’t make a new low late last week. See if it holds the $65 area. Above $67.85 and maybe it gets a push.

MRVL acts decent even as they lowered guidance on their report. It needs to hold $21.50.

AMD held up better than most names. See if it tries to reclaim $27.40.

Cloud names:

NOW is testing that gap again. It’s tricky. See if it holds Friday’s low at $257.50.

COUP reports this week. It made a low at $107.29 Friday.

TWLO is a tricky/choppy name that changes complexion when we expect it least. It was strong Friday. Now see if it holds $128. This might go green today for a trade. Friday’s high is $134.25.

Recent IPOs:

BYND still holds the 8 day. Shorts are trapped. Some traders are long with a stop at $97. It’s a candidate to go green. $105.25 is the recent high. If it gets and stays above that, it might squeeze up again.

UBER held in decent after its earnings. The range is getting tight. It needs to hold $39. It needs huge volume to get and stay above $41.60.

LYFT has been acting better, as we noted weeks ago. Some are long vs. $54. If it can get and stay above $59, it might open to door for higher prices. It was strong Friday.

PD is trying to rebuild after a bit of correction. It needs to hold $49.50 to stay constructive.

ZM is getting tight again. See if it can hold the $76 area to be constructive.

Metals and miners ignited last Wednesday as GLD cleared $121.60. It hit a high of $123.40 Friday. This is Day #3. I usually sell on Day #3, not add.

Today’s Trading Focus

We are pretty oversold and I’d like to buy SPY into the $270-$272 area. It might not get there. If it reclaims $275.24, I might play it long also. I bought some AAPL this morning below $175. It has some room towards $177 if the market wants to bounce.

I covered some FB short around $176 and I’m still in some.

I might play BYND for a quick squeeze. If it can get and stay above $105, it can probably see $110 fast. Maybe BABA can hit $152-$154 on an oversold bounce.

Positions Disclosure: Scott J. Redler is long AAPL, SPY, TSLA calls; is short FB