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Today's Trackdown: Friday - Jan. 15, 2021

SPY Charts and some Technical Analysis

News to keep in mind Today - Today's Economic Calendar - The Charts - Opinion - Stock Picks.


News to keep in mind Friday morning:

  • Futures trade vs fair value were trading a bit lower late last night.
    • Dow -89, S&P -9, Nasdaq -6, Russell -8. (11:40 pm ET).
  • We look good technically - But use "Caution" message has been on here for a while for a reason. (Quick sell-offs and/or getting overbought are a possibility at anytime - so we continue to leave this note).
  • The biggest factors in the market right now are; Coronavirus headlines, the US economy, the Global Economy, and political drama.
  • Watch the VIX - (CBOE Volatility Index) - Still in low or mid 20s.

Today's Economic Calendar:

8:30 AM ET, Retail sales for December is scheduled to be released. The consensus is for a 0.2% decrease in retail sales.

8:30 AM, The Producer Price Index for December from the BLS. The consensus is for a 0.3% increase in PPI, and a 0.2% increase in core PPI.

8:30 AM, The New York Fed Empire State manufacturing survey for January. The consensus is for a reading of 5.5, up from 4.9.

9:15 AM, The Fed will release Industrial Production and Capacity Utilization for December. The consensus is for a 0.4% increase in Industrial Production, and for Capacity Utilization to increase to 73.5%.

10:00 AM, University of Michigan's Consumer sentiment index (Preliminary for January).


THE CHARTS:

(NOTE: Charts are a good guide, but when a tweet or news item can jerk the markets around, they mean a bit less.)

BRIEFING:

Thursday we had a pullback day with a slight decline for the markets. Are we at a top or just up against a resistance area? Time will tell. This is something to keep an eye on.

Note: The Russell 2000 (small caps) are definitely leading the markets so far this year. The positive uptrend is still intact.

Technically alone, we are still looking at a positive chart for the market. We are still trading above our SPY 362.50 support line.

"The possibility of a consolidation, sideways market, or pullback of some kind may happen at some point." But not necessarily. Positive momentum and easy money can keep driving us to new highs.

IF wanting to gamble: Options trades on these ETFs will give you a way to place your bets. $TQQQ - $SQQQ - $SPXL - $SPXS.

* Beware - levered ETFs are subject to decay and are not for long-term holding. *


CHANGES:

  • None.

POSITIVES:

  • The MACD is positive.
  • The Money Flow is positive.
  • We are over the 20-day moving average, which is rising.
  • We are over the 50-day moving average, which is rising.
  • We are over the 200-day moving average, which is rising.

NEGATIVES:

  • Stochastics are high.
  • Possible market top? Getting overbought or to high to fast?
  • * Note: The 50-day moving average has gotten way ahead of the 200-day. This can be an overbought issue.
  • What about the Fundamentals, Valuations, Virus news, the Economy, Jobs, Election issues, Politics, The FED, etc.?
  • Some things out there to worry about still! Or a wall of worry to climb as the saying goes.


OPINION:

  • Currently we are above the 20-day, 50-day and 200-day MAs. (Bullish).

  • The possibility of making new highs is on the table as the technicals are still positive.
  • SPY 362.5 is strong support.
  • Charts alone without thinking about the Fed, politics, vaccine, virus, etc looks good.
  • But those risks should be kept in mind.

  • Previously we saw the possibility of staying in a SPY 362 - 375 trading range for a while, but positive momentum has taken us well above the 375 mark. Will we drop back into that range? We see a 50/50 chance currently.

  • We still say "Use Caution" for a reason. Do not over risk yourself or over leverage yourself.
  • We are still susceptible to large drops or dips.
  • Look for trading opportunities that could result and have your trading lists ready.

* Do not use MARGIN at this time unless absolutely certain of your trade! *

INDICATORS:

The MACD is positive. The Stochastics are high. The Money Flow is positive.

MA +/- (slope): The 50-day MA (364.29)(+0.99) and the 200-day MA (326.40)(+0.62)

The 8-month chart (below).

We are well above the SPY 362.50 support level.

The market has been in an impressive up-channel since June. Technically looking well.


STOCKS: (Our most recent FULL TRADING LIST is posted here).

< Favorites & Trade Ideas > <-- Click here for the quotes, details, news and opinions on our current Favorites and Trade Ideas!

  • Current trading favorites: AUPH - Aurinia Pharma (Their Lupus drug is on a path to approval), EPZM - Epizyme, EXEL - Exelixis, HZNP - Horizon Therapeutics (A big winner for us this year/tripled), IOVA - Iovance, KPTI - Karyopharm, SGMO - Sangamo, TGTX - TG Therapeutics (Our Top Pick!).
  • Tech Picks: CRWD - CrowdStrike (Although be aware it has a high valuation now).
  • Also watching: DT, OMER, TRIL, VKTX.

* Feel free to share your list/picks in the comments below.


Disclosure: I may trade in the ticker symbols mentioned, both long or short. My articles represent my personal opinion and analysis and should not be taken as investment advice. Readers should do their own research before making decisions to buy or sell securities. Trading and investing include risks, including loss of principal.


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