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Stock Market Analysis - 3/2/2020After Friday's gap down, reversal, and strong buying into the close, today we had the first followthrough day. A short term bottom looks confirmed as all indexes rallied higher into the close on strong volume. The picture on SPY is looking very bullish into the close. We held the Anchored VWAP from the December 2018 lows (Magenta Line) which has been acting as a key level of support during this entire bull run. SPY is currently sitting above the rising 200DMA meaning we are still within a bull market. The 20DMA and 50DMA seems to have flatlined therefore the intermediate trend is neutral and caution must be taken for a possible change in the longer term trend. The 30m timeframe is looking even more productive. Throughout the day, SPY had been struggling to breakthrough the 305.25 level where three lines of resistance (200DMA, 5DMA, and Anchored VWAP from start of selloff) were intersecting. In the last 30m candlestick, we blew through this level on strong volume and closed HOD. I would be careful buying into this bounce tomorrow however. The right time to buy was Friday or this morning and if markets gap up tomorrow, this scenario seems overextended. Volatility is currently at extremes therefore large swings, up or down, can occur at anytime. In the future I would want to see price retest the 305-306 area and then run higher with a V-shaped recovery to highs. If we start to chop sideways, I would expect more downside to be possible.
AMEX:SPYLong
by Trader_Kaji
S&P 500 Next Week Expected Move ($44.5) | Broadening Top Short Call - Took an initial short position in several stocks at the end of day Friday. Looking to add more exposure throughout the next several weeks. I don't expect a crash or a recession or anything until late 2021, just a swift and moderate correction at some point in the near future. Larger move than we've had in many weeks - you can see this by the orange bars enveloping the prior two weeks orange bars. It's been an exercise in patience these last few months. Finally think the time is ripe for a reversal. Fear-Greed hit 98 on Thursday, the highest I've ever recorded. Put-Call is extremely low. Bulkowski CPI went bearish as of today. Window Dressing and Santa Claus rally have concluded. AAII survey elevated and complacent. Ned Davis sentiment is extremely elevated. We are in the 3rd standard deviation of the trend , which is where a contrarian investor like myself finds the opportunity. Dow Transports (IYT) is struggling and severely underperforming. VIX is no longer declining, I believe volatility should increase which is further supported by the expected moves. Breadth is declining, signaled by Percent of stocks above 20,50,100 day moving averages Looks like we have a broadening top formation . I have, in purple , marked the initial target for both outcomes. Broadening Tops have poor reliability, so my ABCDE count might be flipped due to my bearish bias. I've shown how both outcomes should look. Last Weeks Expected Move: (Excellent week in my opinion) First Five Days: seekingalpha.com January Barometer: www.yardeni.com 3rd Standard Deviation of Trend: SKEW: Breadth Declining: VIX: Bonds TLT Perking Up: Transports: Initial Claims: - I recently lost my Investment Analyst job for what it's worth. PMI: (Disappointing reading but expecting it to pick up) Goodluck out there next week, please do your own due diligence and don't blindly follow me or anyone's investment suggestions. Everyone is different. Best to all you traders and wishing you a tremendous 2020. - RH
CME_MINI:ES1!Short
by RHTrading
4
Almost there.. Do not short yet! US INDICIESEverything is on the chart. We will go to the white fib line in the pitchfork (1 FIB) at the very least. WHY? Fed is injecting a record ~430B$ into this "NOT QE" repo market in January. I expect the first two weeks (at LEAST, maybe all of JAN) of January to rocket up as a final push and then a breakdown. Unless the Fed continues to inject more and more cash into the markets beyond january, this could be the end. Devils advocate: T has an election coming up in 2020 and the only solid thing he has to run on in my opinion is the market performance. So there is a good chance this REPO crap will continue all the way THROUGH november+ until there are some serious riots in the streets. He wont let a market tank on him before elections unless he is forced in a corner by others... Just my opinion. Please thumbs up and comment what you think! Happy NEW YEARS!
SP:SPXLong
by tubeSound
5