8 Monster Stock Market Predictions For The Week Of February 3
Michael Kramer | Feb 02, 2020 05:42AM ET
It should be an exciting week when trading begins again on Monday. After all, the Chinese markets will open for the first time in a week, and they are likely to be down a lot. The S&P 500 is down about 3.5% since January 24, while the South Korea KOSPI is down over 6%, and the HK Hang Seng is down about 6% too. So could Shanghai move down 7,8,9, or even 10% on Monday? It certainly seems possible.
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Regardless the beginning of the week is not likely to be good for the markets. Then layer in the ISM manufacturing data on Monday, the ADP Job Report, ISM- Non, and the BLS job report, and there plenty of things that could pile up quickly.
The number of S&P 500 stocks above their 50 day moving average is still around 47%, and my hunch is that it still has to fall further, probably to about 25%.
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For now, 3,150 seems reasonable for the S&P 500 to fall too. It is about 5.5% off the all-time highs and appears to have decent support in that region.
It is only about 2.5% from Friday’s close, so we could see that level by lunchtime on Monday, especially with the speeds these markets move.
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I’d be careful with Amazon (NASDAQ:AMZN), the stock now has a giant gap to fill, and it is clear as day the market wants $2,060 to be resistance. Watch for a move lower to $1966.
Now that nobody is going outside anymore, it seems like a perfect time to sign-up for Netflix (NASDAQ:NFLX) and binge some of our favorite shows like Stranger Things or finish off the Irishman. The stock appears to be acting pretty well. The stock hardly budge this last week, I think it will continue to hold $340, but I already told you that.
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The same thing may apply to Disney with its streaming service. Then again, they do have those theme parks. But actually, they have a minority interest in Disney Shanghai and Hong Kong , did you know that?
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Anyway, I noted some bullish option betting in Disney last week, and I saw it again this week. The stock held up pretty well on Friday despite the selling in the market. Probably bodes well for the post-earnings report, with shares rising back to $150.
It is not likely a good week for Alibaba (NYSE:BABA), just because it will likely serve as a proxy for China. A break below $201 probably moves this one lower to $187.
The same can probably be said for JD.com, with shares likely heading back to $36.40.
Facebook (NASDAQ:FB) fell through support at $203, and I think that sets up that drop to $191.
Microsoft (NASDAQ:MSFT) has come a long way in recent weeks, and I think the stock could fall back to around $165.
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