Hello traders everywhere! Adam Hewison here, President of INO.com and Co-creator of MarketClub, with your mid-day market update for Monday, the 14th of October.
It's day 14 of the government shutdown and it's certainly getting down to crunch time where someone is going to have to blink. I think both parties know how angry the populace is with their childish behavior. In my opinion, the National Park Service should be fired for what they did with the open air monuments.
Last week's market didn't close badly with the expectation that we would have a resolution in place this past weekend. That was not to be case and the major indices are lower this morning.
The stock closed last Friday at its highest level in five weeks, based on end-of-week closes. The close last Friday was over the 491.10 level that I mentioned in last week's commentary. Apple moved over its "line in the sand" today at $497 and flashed a major buy signal based on our intermediate term Trade Triangle. Upside targets on Apple remain at $550 to $560 a share.
Netflix (NASDAQ:NFLX) is on a tear this morning, as it has been in talks with cable companies, including Comcast Corp and Suddenlink Communications, to make its streaming video service available through their set-top boxes. I expect Netflix to run into some form of resistance right around the $315 level, which represents a 61.8% retracement from recent highs and lows. Longer-term, I remain positive on this market.
Amazon (NASDAQ:AMZN) faces the same technical resistance around the $315 level. Should this level be taken out, I would expect this market to begin to accelerate its upward momentum. At the moment, all our Trade Triangles remain positive on this stock.
The question remains, are we headed for a financial Armageddon? I don't think so, sooner or later the rubber is going to meet the road and these politicians have to realize that if they don't do something, their political careers could be finished. Holding on to their jobs and their position of power is their number one priority and is a very strong incentive to get a deal done.
My best guess is that there will be an 11th hour solution.
Please feel free to leave a comment, share a thought, or tell us what you think about the markets or Washington politicians.
Have a great trading day,
Adam appears frequently on the following financial news channels as a guest expert. Click on any cable logo to watch Adam's latest appearance.