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Stock Market Analysis - 3/25/2020 - $SPY $DIA $QQQ $VIXIt seems like the overall market outlook has changed and for the better. With a looming $2 trillion stimulus on the horizon, markets have broke the intermediate trend and looks to be in a stage of recovery. Since my last analysis, I expected markets to start to consolidate at this level and this looks to be the case. Although the downtrend has terminated, this does not mean a uptrend has started. The intermediate trend is now neutral and we need to start looking for clues (higher lows and higher highs) that could initiate a new uptrend. Fundamentally, we still do not know what toll this virus will put on the economy. This will become more clear as unemployment, consumer sentiment, and industrial numbers for the quarter are released in the near future. First, lets look at the SPY. Yesterday, SPY gapped up and broke above the downsloping trendline and closed at HOD - a good sign for a followthrough day. Today we got a somewhat flaky followthrough day as we closed at the middle on the range following a large selloff at the end of the day. The intermediate term trend is currently neutral. For a bullish case, I would like to see SPY test the 235-238 area where the 5DMA and Anchored VWAP from the lows align. Otherwise we could easily a retest of lows. I won't go too in depth with QQQ and DIA today as they all look very similar to the action on SPY; however it is important to note today's changes in each index. QQQ closed red at -0.74%, DIA closed green at +2.54%. Notice the relative strength in DIA and relative weakness in QQQ. During Bear markets, it is common to see rotation out of previous leading sectors such as Technology (QQQ) and into utilities and industrials (DIA). A quick google search about Sector Rotation can better explain this phenomena. This type of price action are clear indicators we are in a bear market and until we see rotation back into leading sectors such as technology, this bear market will continue to persist. The price action on VIX is quite telling for what the future could hold. Although we had a nice reaction bounce yesterday and today, VIX recovered it's initial gap down and closed green today. VIX looks like it is consolidating and could breakout tomorrow. I expect VIX to retest highs. Overall, the intermediate trend and the short term trend are both neutral and volatility is still high. These are not favorable conditions for the swing trader. Until we see trending conditions, now is not the time to put on new trades. Instead, as a swing trader you should use this time to start looking for new long or short ideas. When markets start to trend, you will be ready to take advantage of the new leg up or down.
AMEX:SPY
by Trader_Kaji
2
Have A Look At The Dow Jones $DJIThis is a WEEKLY chart. Each candle represents one week of price activity. Although I don't typically trade the DJI, the major media outlets publicize "The Dow" levels every day. I think this chart is important for the average investor. In 2013, The Dow got to the 16,000 level. Ever since then, the 16,000 level has been support. You can see that in Oct 2014, Aug & Sept of 2015, and Jan 2016 this 16,000 level is where The Dow turned higher after a decline. Round numbers show up in many places in investing. They should be respected and they should be considered. Keeping this discussion simple, a round number may wind up being the place where The Dow shows us support again. The Dow has already given up the level it was at when the current president (Pres #45) became president. That is 3+ years of market gains given back in a four week period of time... If you ask me, that says a lot about how "strong" the economy has been. I could go on for a bit about this topic. But I won't. Let me just say that you can't only listen to the narrative from politicians about the market & the economy. You have to pay attention to details. Pay attention to charts. It is a learning process. It will take time. It will feel like a college class that you fell behind in. But no one can pay attention to your money like you can... How low will The Dow go? Honestly. I have no clue. All I can do is pay attention to the past and look for clues about the future. No one can answer this question for you. You just have to pay attention to some details. Dow 18,000 is a place that The Dow met resistance and then some time later found support. Dow 16,000 is a place that The Dow didn't find much resistance but it found support many times. Is there a clue in here about where The Dow will find support. Maybe. I have never been a part of history where our economy has shut down. I watched the tech bubble burst but I wasn't investing at the time. It is so hard to fathom that our government has chosen to shut down the economy... It is also hard to fathom how low The Dow will go because of the decisions our government has made. Let's hope that The Dow turns around somewhere between where it is today and 16,000. Let's watch the chart for more clues. Clues like an inside week that resolved to the upside. Clues like a weekly candle with a higher high and a higher low than the last weekly candle. Clues like a weekly candle that dips below the previous candle's low but then closes the week above the previous candle's low. These are only clues. They are not tell tale signs of a clear turn in the market. Keep watching. Keep learning. Don't give up. This may be another on of those "best time to buy stocks in our lifetime" moments. Then again, it could be something else...
DJ:DJI
by TheTrendLineInvestor
Current global markets situation and everything you need to knowTo gain an edge, this is what you need to know now. 1) Yields on 10 and 30-year Treasury bonds stayed way above their lows as the stock market fell to new lows. This is a big positive. 2)Oil held way above its Sunday lows. This is a big positive. 3) The Fed is providing unprecedented liquidity of as much as $1.5 trillion. The stock market first rallied 6% on the news and then gave it all back. This indicates that the Fed is not going to be able to save this market. However, Fed's move will stop several potential dislocations in the financial markets and that is a positive. 4) This afternoon near the lows, smart money was lightly and selectively buying. 5) Big part of the selling was due to margin calls. This is a positive because margin calls eventually exhaust themselves. Gold Central bank selling in gold continues. Here are the key points. - Central bank selling in gold, perhaps from Russia, appears to have continued. - There are rumors that Italy is selling gold to pay for coronavirus expenses. - When the stock market was halted, gold market was still trading. Over extended investors desperate to raise money sold gold to pay for margin calls in the stock market. - Now that the momentum in gold has reversed, the momo crowd is aggressively selling gold. - As gold miner stocks have pulled back on selling in gold, there is a bloodbath in ETFs GDX and NUGT on margin calls. Smart money continues to buy gold and gold miner stocks on dips. Complacency My proprietary indicators are showing that there is still too much complacency among investors. Many investors continue to believe that the market always goes up after brief dips. Such investors are not selling. "Buy the dip crowd is still alive and well." Until these two groups of investors start selling, there is only a low probability of a lasting bottom unless there is a good news on coronavirus.
OANDA:SPX500USD
by sickgains
1
SPX Support Levels (Nearing buy levels)SPX has been hit hard lately but I think we are now closer to support levels that should be watched closely. I have a few stocks with market cap slashed in half and/or are more than 50% down that I am watching. As I mentioned in my last $AAPL idea, this downturn will move fast now before the fed rate cut and any stimulus package. I believe that we hold the 200MA (second support in the chart) if not then we have a long way down to Dec 2018 lows. I know the expert will blame corona virus but digging deeper, the market was overly overvalued and needed to sell off with or without the corona virus. Now, the corona virus could lead us into a recession in which case whatever extended bounce we get with the stimulus package and rate cut will be temporary.
SP:SPXShort
by UnknownUnicorn3272672
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