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Today's Trackdown: Friday - Oct. 16, 2020

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 mixed late last night.
    • Dow +16, S&P +4, Nasdaq -5, Russell +10. (1:35 am ET).
  • We look ok technically - But use "Caution" message has been on here for a while for a reason. (Quick sell-offs are a possibility at anytime - so we continue to leave this note).
  • The biggest factors in the market right now are; Stimulus deal news, Coronavirus headlines, the economy, the Global Economy, China, and upcoming elections.
  • Watch the VIX - (CBOE Volatility Index) - remains a bit elevated, remains in the mid-20s.

Today's Economic Calendar:

8:30 AM ET, Retail sales for September will be released. The consensus is for a 0.7% increase in retail sales.

9:15 AM, The Fed will release Industrial Production and Capacity Utilization for September. The consensus is for a 0.6% increase in Industrial Production, and for Capacity Utilization to increase to 71.9%.

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


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:

We got more selling and another little pullback on Thursday, but notice we started the days at the lows and the dip was bought throughout the day. So we may have seen a support level at SPY 343ish show itself. Not much change to our charts, except the Stochastics have come back down to more of a neutral level. We continue to mark SPY 340 as a support level.

Everything technically looks good.

* Repeating.... "Our only problems with the market now are the uncertainty about the upcoming elections and stimulus legislation, in addition to the valuations seeming a bit high."


* Don't risk to much, there is still a lack of CERTAINTY in the markets. *

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:

  • The Stochastics are back down to a neutral level.

POSITIVES:

  • The MACD 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:

  • We may need to retest the SPY 340 support to see if it holds.
  • What about the Fundamentals, Valuations? Virus, Economy & Jobs, Elections, Politics, The FED, and China troubles?
  • A lot to think and worry about!
  • The Vix is still a bit high and may remain high for the foreseeable future.


OPINION:

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

  • We see a sideways to slightly higher - range bound type of market for the moment.
  • Technicals alone the market looks good.
  • But.... with so much uncertainty about the upcoming election, stimulus deals, etc. We don't want to jump all the way in.

  • 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 neutral/high. The Money Flow is neutral.

MA +/- (slope): The 50-day MA (337.94)(+0.48) and the 200-day MA (309.17)(+0.15)

The 9-month chart (below).

We are well above the SPY 320 line, which is very strong support. (Bullish).

We are also above the SPY 340 line, which is now minor support.


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, TGTX - TG Therapeutics (Our Top Pick!).
  • If your thinking longer-term/income: T - AT&T (7%), XOM - ExxonMobil (10%) - high dividend yields.
  • Tech Picks: CRWD - CrowdStrike (Although be aware it has a high valuation now), DT - Dynatrace.

* 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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