Before the Open (Jan 19)

Posted on by Jason Leavitt

Good morning. Happy Thursday.
The Asian/Pacific markets closed up across the board. China, Hong Kong, India, Japan and South Korea each moved up more than 1%. Europe is currently up. Austria, Belgium, France and Amsterdam are up 1%. Futures here in the States point towards a moderate gap up open for the cash market.

The dollar is down. Oil and copper are up. Gold and silver are up.
The market continues to chug along. It has moved up 17 of the last 22 days. Dips have gotten bought. Gap downs have gotten bought. Many groups and many more individual stocks have done very well.
All the indexes have closed above their October highs. Once again it has paid to just go with the flow rather than being in denial. Lately I’ve been a little cautious, and it’s probably cost me a couple bucks. Oh well. Being cautious doesn’t mean I cash out and go short. It means I view new positions as shorter term trades because the risk/rewards aren’t great. I don’t go short just because things are a little extended. Within an uptrend, I go back and forth between being long and being closer to the sidelines. I’m fully aware of all the bad that’s going on in the world. I’m also fully aware of how dumb it is to fight a market that wants to move up.
Absent very bad unexpected news, the market should continue higher. My SPX target is 1350 – another 40+ points to go. This doesn’t mean it will continue moving in a straight line – it just means given the indicators, given the broad participation, given the strength in some key groups, there’s more upside to go. Don’t fight it. More after the open.
headlines at Yahoo Finance
headlines at MarketWatch
today’s upgrades/downgrades
this week’s Earnings
this week’s Economic Numbers

0 thoughts on “Before the Open (Jan 19)”

  1. The markets in general are not necessarily extended, but maybe over bought. I say maybe because some of the indicators are at high levels but it doesn’t mean they can’t go higher.
    This morning may be an opportunity for some scalping at the open. If your stops are not taken out, those trades could turn into swings. But, one needs to be nimble unless you have set hard stops.
    The Bollingers bands are singing “continuation” on the indexes.

    1. Indeed, trick now is to see if long term resistance holds, is selling just profit taking by the weak hands or something else.
      There are definitely more new leaders more stocks rising from the dead.
      Best of luck.

  6. The board seems to be in agreement that very short term, the indices are overbought and a nice correction is in order before higher prices. From an EW perspective, now that SPX has cleared 1310, the ending diagonal idea with a 1325+/- target becomes questionable (but not eliminated) and the door is opened to the potential for an extended wave structure targeting 1370. So far, pullbacks have been corrective (not impulsive) and trying to pick a top is dangerous. I wouldn’t rush to get short absent clear signs of downside impulsive action and a breach of intraday trendline support, at a minimum. I don’t see either so far.

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