But a buy here and now does microsoft hold the key to new market high sns guy what do you say. First of all, you have to you know, we criticize dan on twitter. Really. He is criticized. Dan. Why. Why is he criticized on twitter. For being do youwers. But cant coined maga we can fire the graphic at the top of the show. Dan does know a lot. The maga trade. Yes. And look at the m. In maga as we know is microsoft so. Some hat. On straight valuation price to earnings its expensive look at the last quarter i mean, eps beat was significant. The revenue beat was amazing azure grew 64 year over year. Operating margins 230 basis points better year over year its hard to cast aspersions yes trading yall alltime high. People make a big deal of the 40 billion. I want 4 of the market cap, not insignificant. Answering the original question it can rally into earnings mr. Maga. What is a i. You from a trading standpoint, the stock broke out in early june about 130 basically trading between 130 and 140 since then until today you had the break out on the good piece of fundamental news to guys point i want not moving the needle but gives you increasing confidence to that they give money back to shareholders this is also a company thats been smartly aquis itive when they paid for linked in i think a lot of people thought they were crazy then you think about now in the cloud and how they use the different pieces of the puzzle to get recurring revenue it was a smart buy i think this thing you trade it, playing for a reakout. Its going to consolidate as it does from time to time but there is other legs higher in this name. Will this be caught up if we see the continuation of rotation out of growth into value does it get caught up or fall in both buckets. This is value its in and apple are the two value names. Apple up 40 microsoft up 38 both yielding the same thing theyre both value but i will put the caveat as dan said it backs a little bit its got to hold 140 so real short leash its only a smidge taqle term above 140. You got to hold out but if it breaks out its 150. I would phrase it i agree with steve on apple. Im not sure i could call microsoft value here apple falls into that camp the reassertion of the growth trade is what it is. I point the out about samsung breaking dan brought up samsung on the call because im an e. M guy. Look at alibaba up through 182, 183 breaking through the upside of resistance thu think about what that means and global cyclicality those are the biggest market cap stocks. Will they lead the market . Of course . And apple to me is the place you start. Because i think the way apple traded through a difficult two weeks is extraordinary the release is behind them whether you liked it or not. The company has leverage to pull the same one microsoft pulled on buybacks you name it. Back to the original question is microsoft the key to new market highs as if no one answered it. Kind of no i dont think microsoft is the kai to new market highs. You want the banks to participate. At some point you need some of the material stocks some of the old rust belt names that have been under pressure. So i think microsoft is a great peg. Dan was a genius to cone that term maga but i dont think it holds the fortunes of the broader market. Whats interesting my contention has been always everybody talking about fang and netflix doesnt move the needle as far as importance the thing about maga in general was microsoft was the only one confirmation highs in the s p 500 since january of 2000. The only one really. Google had a short one alphabet in july but fell back i think you have constructive charts right now in google, in apple, not so sure jury ut you out on amazon its been in the up friend since december but i think they hold the key a bit. They are the only one that is can hold the key just because from the mere just the mere fact of the percentage its not energy we saw energy blip up. But energy is nothing as a percentage of the s p. I want got to be the large cap tech names that continue to perform theyve already outperformed and they must continue to perform. I think you have everything guys i think you have the value thats following the growth. The value would be the banks and we talk about Bank Valuations there is a ren to push back on valuations but look at jp morgan and look at the follow through from the financial community. But the other part what have we got two weeks ago, the great rotation meaning higher yields and move of also banks but transports and some of the industrials. Thats the combination here. So for everybody thats said the market hasnt had the breadth you need the leadership. As you said microsoft can give that and apple gives gnaw that lives luch gives a lot. The transports look really bad. Looking at series of lower highs. If you took out fedex would it be the same chart. Youre right fedex is weighing if you look at aerials doing fine the rails are certainly a place to be hiding out. Who drew that chart mike santoli before they tossed he said with jm morganen microsoft making all times he posed it differently we dont look like we are collapses which is interesting. Two dames names weve been talk bag jp morgan above 120 its a level from three times back over the last 18 months. You never look like youre collapsing i wouldnt put it in two hands. Klf looked weak ob a granular basis today. I know there was concerns about trade and other things but the xlf closed weak from where it started strong and gave up ground. On the day. On the day. The beg begging to be asked and running around in your head. Lets see if youre in my head. You know i am. I dont think she is going to admit it. She is saying Something Like well what is the mechanics microsoft is that sort of. Thats the question i asked in the Conference Call today yeah, sure you guessed. What is it whats the next microsoft, guy. Call me crazy steve has been right about in i think collectively around the desk weve been right to cast aspersions with this name. But ibm if you look we might be on the precipice of maybe ibm turning that Aircraft Carrier around the first time in six or seven years. Wow. Is jeanne rometty. Maybe the redhead acquisition and. The number was shocking to me and i thought the percentage of hardware you still think is a huge number in ibm and its 8 . Theyre slowly turning around couple that with the Blockchain Investment and maybe there is some maybe there is home. Now Katie Huberty all over apple and the axe. She believe initiated ibm with 170 price target. Its crazy its a bit of a a high flier but maybe ibm could be Something Like microsoft was five years ago. All of you guys are crazy. Thats why we have conversations. Thats right. Crazy is a strong word. I appreciate guys attempt to get in there and give us another idea the turn around story at microsoft and ibm sometimes are comparable old glory translated into new world glory which microsoft has done i dont think ibm is doing it in the shortterm how about facebook it troubles me to say. Ive certainly not been constructive on facebook if you see of the rest of the group going which not facebook just above the 1907 resistance if you look at the chart all of these consolidated all of the headlinesing related to regulatory pressure break up the company you name it and they digested it. If this market moves with microsoft membrane has to be a part. We sound all geekd up about maga cap tech. I think you want to go back to sysco guiding and what they said and the change of commentary and then fedex the other day and then adobe which has been a stock market darling that guided down now the stock is kind of flattish or whatever but i think heading into quarter end i think its really important to keep an eye on some of the things out in front and were seeing weak Forward Guidance because of the uncertainty. Fedex and adobe okay next guest says microsoft and one other dow stock hold the key to the mechanic lets go with todd gordon with trading analysis. Com what are you looking a at. And i climatic because you have been talking about bull stocks but a beautiful up from upfriend here and now technical you couldnt draw a more picture perfect parallel trend channel this is the stock pr prerepurchase from 2016. Announcesing the next one. We are towards the upper end of resistance i trimmed half of my personal position couple weeks ago wish i didnt i added the other half today you will encounter resistance at about 155 just a heads up in that sourced all the way back from 2015. Just a beautiful uptrending clarity. The other one no surprise, jp morgan just a big awesome breakout from a channel. In an underperforming financial environment. I mean i mean its hard to be bearish in this market with the charts here. Looking at the breadth and some of the reasons why i think the broader markets will continue. Lets look at advance decline. Advancing stocks, declining stocks on the nyse this is interesting. This is really over the last six months its been a leading indicator two prior occasions. Looking here this is may to june area the ad line broke out well before the s p did in that exact time period. The same thing happening here. This is so obvious unbelievable s p has not yet made a new high. You can see advance decline, like goodbye another indicator look at advance declineville minus declining volpe the slansing shares seeing more volume than the declining shares a breadth indication we should continue higher. How high should we go . If i put the el wave hat on which i love the way i see it is the first push up first number one a little bit of skongs this is the widespread participation for number three going back to charles dow thaeps the widespread participation this is the fourth wave and i do see one more wave five push up doesnt come in we dont find resistance until 3,800 next 12 to 24 months in the s p. I think were going higher did you say 3,800, todd. Thats my upside target. What kind of. Two years, two and a half years. 5 years. I dont know well get there eventually. Eventually thats not a forecast that is where technical resistance comes in you can see it it couldnt be more perfectly drawn. We will encounter resistance depending on the angle of aresident straight occupien on the kilo heel resistance comes in at 35 oh oh in a low volume environment its a higher technical resistance depends on the angle of approach. All right, todd, thanks todd gordon trading analysis. Com lets say its 3,500 what todd said 500 points from here. I see resistance a little lower than todd. I see the overshoot at 3075 and 3,100. You get a real overshoot level, you get to 1350 but as todd said he could be talking about a two to fiveyear time horizon. Were talking about as soon as that deal is inked you are looking at 3150. Yeah. Talking about trading channels is one thing and where we have come from where we go. The more important thing for the market is justify valuations and times in the market when people are worried about growth and people willing to pay for microsoft. Willing to pay for higher safety multiple stocks. And that probably shl probably is included apple although i dont think its a high multiple stock. Thats the environment were in. If you want the allegory in the time frame you can understand is 2016 where we came out of this growth fear, the rally we saw two extraordinary rallies in 2016 taking us to 2017 thats what it feels like. It feels like the transformation from going to recession okay things arent that bad even though not that good and thats the back drop here. Coming up, the dean evaluation is back he will tell why to avoid the ipo and look for value instead cnbc delivering alpha. We tell what you the top investors are putting money. Live from times square in new york cy. It much more fast money right after this the world is built for you. So why isnt it all about you when it comes to your money . So. Whats on your mind . We are a 97yearold firm built for right now. Edward jones. Its time for investing to feel individual. At verizon, were building the most powerful 5g experience for america. Thats why the nfl chose verizon. Because they need the massive capacity of 5g with ultra wideband, so more screaming, streaming, posting fans. Can experience 5g all at once. This is happening in 13 stadiums all across the country. Now if verizon 5g can do this for the nfl. Imagine what it can do for you. Have you lost weight . Of course i have ever since i started renting from national. Because national lets me lose the wait at the counter. And choose any car in the aisle. And i dont wait when i return, thanks to drop go. At national, i can lose the wait. And keep it off. Looking good, patrick. I know. vo go national. Go like a pro. Hey. You must be stevens phone. Now you can know whos on your network and control who shouldnt be, only with xfinity xfi. Simple. Easy. Awesome. Mr. Zuckerberg how did the meeting go to. What was your message to lawmakers mr. Zuckerberg can you assure lawmakers that your platform will not be manipulated ahead of the next eek . Did you talk about possibly breaking out facebook . Did you talk about privacy legislation . Are you hopeful it comes to the floor before the end of the year are you ready to deal with californias privacy legislation . That was our ownual mui do a valiant job asking questions mark zurich rk questions this after he met with lawmakers on the hill did you get any answers from anyone todayuale we got a couple of the answers from the lawmakers not mark zuckerberg. We note zuckerberg met with three republican senators mike lee, tom cotton and josh holley each meeting lasting 30 to 45 minutes. Zuckerberg did not answer questions from reporters at any point this afternoon but the senators were a little bit more talk aactive mike lee said they discussed bias against conservative was antitrust legislation, the 230 liability shield and data prief spi. Meanwhile josh holley said they had a frank conversation and the senator told zuckerberg straight up that facebook should sell off whats app and instagram apparently zuckerberg was not receptive to the idea. But facebook has outlined four areas it wants to engage with congress harmful content, election integrity, privacy and data portability. Holley was skeptical solve some of ideas particularly spree led frameworks around data portability. He didnt get Firm Commitments for changes from the company and thats been talk from facebook but not a lot of action. Melissa, zuckerberg will be in d. C. Tomorrow. We see where he goes next back to you. I presume sul be on his tailualen. Do our best. Ylan mui in washington thank you. Senator lee is important he has the Senate Antitrust committee here whats at stiek here tim was say processing the market goes highary erran facebook participates they should ride the rally. Interesting for facebook and alphabet are trading within a few of all time they have the ftcdoj and the stock acts well facebook earnings estimates got cut dramatically for 2019. Starting late last year midyear to the end of the year and expectations got low and it looks cheap especially when sales are expected to continue to grow at 20 plus a clip they are not selling off those different groups or anything like that. And their mote gets bigger this is the first appearance on capitol hill since the hearings of 2018. And you can make the argument that actually bad news could be good news for facebook maybe its more valuable entity process if they break it up whatever it looks like there to tims point it pains me to say but its traded well since april. Basically higher highs and lie higher lows. You wonder into the october 30th release there about does it trend higher into earnings i believe it will and retest that alltime high at 222 or there abouts from capitol hill to wall street the ninth delivering alpha conference taking place in new york city where the whose who thayer top ideas lets get to leslie pick we are the highlights. Big themes today including public versus private markets, the complications of negative Interest Rate and the fallout from the trade war with china. There were also mixed views on the state of the u. S. Economy. American economy is booming its absolutely undeniable. We think the consumer is the bright spot in a u. S. Economy. But that cap exand the Manufacturing Sector is obviously in recession. The shorttermism of investors is what kills the longterm abilityto compound my biggest fear is people are uninvested from the hangover of 2008. In addition to macroideas notable investors gave specific picks. Jim chen ohs soak spoke about two shorts including in grub hub. The stock fell sharply after he criticize the the company for making almost no money per order. He said he was short a kidney Dialysis Company leon cooperman says he is long energy and and another bullish on uber on soviet bank disney is his Largest Holding direct to consumer stream. Leslie thank you. Leslie picker at the conference all day there in new york city which pick would you go with or go against grasso. I agree with chen ohs and grub hub the competition is way too tight for them and theres becoming such a commodity advertised business process. They were the darling and now they are thrown out. I dont know how much lower it can go but it seems everyone is lining up to be negative on grub hub. You have amazon delivering food and uber eats and both are linked to lose money on everything they sell. Im not sure anybody perfected the Business Model but the valuation is what you can go after in the environment where the competition is coming from all sides good for jim this is a stock at 160 stock traded 140 traded in the mid60s. The question is how far you push the short. At the valuation there is something left. Its fascinating that we have we have door dash all of these in the private markets still funded by vcs. Still afforded to lose money to compete in the space i think its important to go back to remember that grub hub and seemless were public years ago and merged they recognized this is a really tough business s in a company that had a billion dollars in sales last year or this trailing 12 months and had on a gap basis net income of 26 million telling you how competitive it is. Its hard for all of those ones still private to come out to the public mechanic. Youre seeing more skongs. I dont know where mr. Chen ohs is are the short the st. Croix this was a 60 stock now trades at a big valuation. But you got its scary stock. 32 Short Interest you have the headline shake shack partnering up. Mcdonalds thats not insignificant i do think there is downside but you have to ask, you have seen what happens with high Short Interest names before. And the violent moves up i would be id be a little bit of scared from the shortside at current levels. Taking break here im melissa lee. Youre watching fms on cnbc here is what else is coming up. Is owning costco stock t