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Today's Trackdown: Thursday - Jan. 10, 2019

  • Brief Recap and Updates on the Markets
  • SPY Charts and some Technical Analysis

In Wednesday's action:

The S&P 500 gained 10 points on Wednesday, helped by softening trade tensions, easing anxieties over U.S. monetary policy, and rebounding oil prices.

 News to keep in mind Thursday morning:

  • Futures trade vs fair value are lower early this morning - Dow -130, S&P -15, Nasdaq  -43, Russell -9.
  • The China trade war news and Fed watching are the 2 biggest issues currently to keep an eye on.
  • Keep an eye on the VIX - If the Vix can drop and stay under 20 it may mark the signal to buy the dips and start taking more risk again.
  • Remember the December nonfarm payrolls increased by 312,000. A huge out performance of expectations!
  • A very full Economic Calendar today!!

Today's Economic Calendar:

Quick Notes: $AAPL $SWKS $MU

The Philadelphia Semiconductor Index (+2.5%) was an out-performer on Wednesday, despite Apple (AAPL 153.31, +2.56, +1.7%) supplier Skyworks Solutions (SWKS 67.69, +2.50, +3.8%) lowering its fiscal first quarter guidance.

The group performed due to a few factors which included (1) the positive price action in Skyworks despite the bad news, which was interpreted as a sign that the bad news was already priced in, (2) Bernstein upgrading Micron (MU 35.44, +1.70, +5.0%) to 'Outperform' from 'Market Perform', and (3) optimism over the trade discussions with China.

Tiger's Take: "The China trade talks have made this sector more optimistic that some kind of deal can be reached."


The SPY charts are pictured below. The first is a 4-month chart followed by a longer-term 9-month chart.

The markets finished higher on Wednesday as the rally continued on. The technicals are still damaged due to being below both the 50-day and 200-day moving averages, but have really improved. Resistance levels are now at 280, 260, and both of the moving averages. Support is at 250 with very strong support at 235.

The MACD just had a positive cross. The Stochastics are at overbought. The Money Flow is a nice positive after a huge "V" bottom formation was completed.

The Vix remains a bit high still, but has been slowly drifting lower and may soon drop under 20. This would be a good sign for the bulls. For now we are in a 250-260 trading range.

We may see a pullback as the rally has lasted a few days now as the stochastics are overbought. I expect any weakness or dip will not lead to the 250 support to be broken as the MACD and Money Flow look very constructive going forward.

On the 9-month chart below, the previous patterns are behind us. Shown now are the resistance levels of 280 and 260. Support is found at 250 with strong support bottom at 235.

  • Russell 2000 +6.7% YTD
  • Nasdaq Composite +4.9% YTD
  • S&P 500 +3.1% YTD
  • Dow Jones Industrial Average +2.4% YTD

NOTICE: The Russell 2000 is leading the market higher so far this year, outperforming the larger averages.


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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