Morning Market Thoughts

Good morning. The market opened a bit down this morning, but nothing worth talking about. In fact, with the Fed’s decision on interest rates just a day away, don’t look for much movement either way. And because of that, I don’t have much to day.

Here are a few stocks that should be on your screen:

Disney (DIS): popping out of an ascending volatility squeeze. Looks like the stock could move higher from here, though I would have preferred that the squeeze setup had actually been a bit flatter, if not trending lower. So there’s a pop here…but I don’t know how high the stock will go.

Nike (NKE): This stock has been consolidating after a break of a long term downtrend. With the stock between $56 and $58, this is one that is starting to move in an uptrend. If I didn’t know better, I’d say that masses of customers were returning their UnderArmour (UAA) apparel to the store and exchanging them for Nike’s stuff. UAA down; NKE up. “Just sell it.” vs. “Just do it.”

Snap (SNAP): Now trading at an all-time low. And since the stock has been trading for 9 days, and has been in a range of 30%, it’s actually pretty impressive that the stock is still falling lower.

Valeant Pharma (VRX): As noted in last night’s Strategy Session, Bill Ackman has finally capitulated and sold his entire position in Valeant. In light of this high profile disaster, this stock has probably bottomed. That’s the way of things when a large hedge fund puts conviction above cash. He held as long as he could while the stock fell lower and lower. Finally, it would seem as if he was the last seller. So when he sold, the downward pressure on the stock reached its max…and now it’s likely to move higher. It is still 9.5% down from yesterday’s close, but is up about 3% from the opening print. A move above $11.05 would be a good entry because that’s the high of the morning.

See you in the forum.


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