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Today's Trackdown: Monday - April 5, 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 Monday morning

  • Futures trade vs fair value were trading higher late last night.
    • Dow +228, S&P +17, Nasdaq +15, Russell +38. (12:10 am 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, interest rates, the Global Economy, any political drama.
  • Watch the VIX - (CBOE Volatility Index) - The Vix is back down under 20. Not a huge concern currently and getting the indication some risk is coming back on.

Today's Economic Calendar:

10:00 AM ET, the ISM Services Index for March.


THE CHARTS:

(NOTE: Charts are a good guide, but news items can move the markets around.)

BRIEFING:

The markets made new record highs last Thursday. Traders enjoyed a long weekend after the market rally and an outstanding jobs report. As we write this, Dow futures are up 200 for Monday's open. On our charts, we leave the previous trading range on the chart even though we have clearly broken out and above that range. The Stochastics have become high/overbought while the Money Flow has really improved to a very positive reading. There is no reason the market can not continue to make new highs from here. We would keep caution and some cash available though.

We were in the SPY 380-395 trading range on the 4-month chart.

* Repeating: Previously we mentioned two Scenarios: 1) We break above the SPY 395 resistance line to new highs, or 2) we get turned around and stay within a trading range.

At the moment, the first possibility is winning. Keep both possibilities in mind when making your trades. Make your own determination on the possibilities and your personal risk tolerances.


Questions to ask oneself before the trade: How well is the economy is reopening? Virus news? Will treasury yields stay low/stabilize?

Positives: We are above the 50-day moving average and well above the SPY 380 support level.

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 S&P 500 made new highs.
  • The Stochastics are high/overbought.
  • The Money Flow is very positive.

POSITIVES:

  • The MACD is positive.
  • The Money Flow is very 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:

  • The Stochastics are getting high/overbought.
  • Possible market top or trading range in the future?
  • Thinking about the Fundamentals, Valuations, Virus news, the Economy, Jobs, 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 MACD is positive. (Bullish).
  • The Money Flow is very positive. (Bullish).

  • We were in trading range of SPY 380-395 with mostly bullish indicators.
  • Broke out to new all-time highs with the possibility of continuing higher.
  • Technically we are looking good!
  • BUT... some risks to the markets still remain. IF/When will the Fed and stimulus sugar run out?

  • 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.

* Be careful if using MARGIN, be certain of your trades! *

INDICATORS:

The MACD is positive. The Stochastics are high/overbought. The Money Flow is very positive.

MA +/- (slope): The 50-day MA (386.93)(+0.36) and the 200-day MA (352.15)(+0.47)

The 8-month chart (below).

We are above the SPY 380 support level and making new highs.

The market continues to climb in an impressive up-channel.


STOCKS: < Favorites & Trade Ideas > <-- Click here for some quotes, details, news and previous opinions on our Favorites and Trade Ideas lists!

  • Current trading favorites: $AUPH - Aurinia Pharma (Lupus drug has been FDA approved!), $EPZM - Epizyme, $EXEL - Exelixis, $HZNP - Horizon Therapeutics (A big winner for us last year), $IOVA - Iovance (Dropped from 50 to low 30s, good time to buy), $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: $IMGN, $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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