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Today's Trackdown: Thursday - April 30, 2020

SPY Charts and some Technical Analysis

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

Previous market day....End of Day Brief....(click here)...   Dow +532.31 at 24633.86, Nasdaq +306.98 at 8914.72, S&P +76.12 at 2939.51


News to keep in mind Thursday morning:

  • Big tech companies Microsoft ($MSFT) and Facebook ($FB) reported good earnings results last night lifting the futures after hours.
  • Futures trade vs fair value were trading a bit higher late last night.
  • Dow +80, S&P +15, Nasdaq +110, Russell +6.
  • Still unpredictable! But we have successfully held above the SPY 270 support level and advance above 280.
  • The biggest factors in the market right now are; Coronavirus headlines, when the economy will re-open, the Fed, the Global Economy and Global Geopolitical conflicts.
  • Keeping an eye on the VIX - the CBOE Volatility Index has been slowly coming back down.

Today's Economic Calendar:

8:30 AM ET, The initial weekly unemployment claims report will be released. The consensus is for a 3.500 million initial claims, down from 4.427 million the previous week.

8:30 AM ET, Personal Income and Outlays, March 2020. The consensus is for a 1.4% decrease in personal income, and for a 5.0% decrease in personal spending. And for the Core PCE price index to decrease 0.1%.

9:45 AM, Chicago Purchasing Managers Index for April.


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.)

The markets had a great rally day for multiple reasons on Wednesday. 1) Google led the big tech names higher after good earnings report late on Monday. 2)  The Fed stated they will backstop almost everything!  3) BioTech company Gilead reported some success on a Covid-19 virus drug trial.  4) We had a 'Bull Flag' breakout.

 We are now well over BOTH the 50-day moving average and the SPY 280 levels. We may continue drifting higher from here. The 50-day MA could now be considered support and the SPY 280 level may become support soon for us.

The next level that could act as resistance is the 200-day moving average. Watch that as well as the Stochastics which are getting up closer to showing a short-term overbought signal.

* 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 - $TNA.

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

CHANGES:

  • We are now well over the 50-day moving average.
  • We stayed above the resistance at SPY 280.

POSITIVES:

  • We are over the 20-day moving average.
  • We are over the 50-day moving average.
  • We have held support (270).
  • The Vix continues to slide lower.

NEGATIVES:

  • The 50-day moving average is declining.
  • We are under the 200-day moving average
  • The Money Flow is slightly negative.
  • The Vix is still high / above 20.


OPINION:

  • Currently we are above the 50-day MA and SPY 280. Very good.
  • If we stay above these levels for a while, they may become support. Bullish.
  • Next resistance level is the 200-day MA.
  • Overall, on a technical basis we are in decent shape. But as there is so many unknowns it is wise to use caution.

  • Be aware that we are susceptible to large drops or dips with the current level of uncertainty.
  • Look for trading opportunities that could result due to higher volatility!
  • Have your trading lists ready.


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

INDICATORS:

The MACD is positive. The Stochastics are neutral. The Money Flow is slightly negative.

MA +/-: The 50-day MA (276.60)(-0.84) and the 200-day MA (297.54)(-0.01)

On the 9-month chart below, we are looking at a severe and quick drop of the market and then a rebound.

The 270 support line is now considered as 'confirmed' support. It is a good technical sign for the markets that we have stayed above 270.

SPY 280 and the 50-day moving average (currently 276.60) were the next obvious spots for resistance, but we have broken above them AND left those levels well behind. They may become support levels.

* Continue to use caution - Still many unknowns. *

STOCKS: (Our most recent FULL Trading List is posted here). We will be updating this later this week.

  • Current favorites: $AMRN - Amarin, $AUPH - Aurinia Pharma, $COLL - Collegium, $EPZM - Epizyme, $EXEL - Exelixis, $HZNP - Horizon Pharma (if under 34), $IOVA - Iovance (buyout rumors), $IMMU - Immunomedics (FDA approval last week!), $KPTI - Karyopharm, $TGTX - TG Therapeutics.
  • If your thinking longer-term/income: $T - AT&T is worth a look - high dividend yield.
  • New ideas: $BFYT - Benefytt Tech, $CRWD - CrowdStrike.

* 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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