Before the Open (Jan 24)

Posted on by Jason Leavitt

Good morning. Happy Tuesday.
The European markets are down across the board. Austria is down 2.3%, France, Germany, Amsterdam, Norway and Stockholm are down more than 1%. Futures here in the States point towards a moderate gap down open for the cash market.

The dollar is up slightly. Oil and copper are down. Gold and silver are down.
There’s been less to talk about lately because the market has pretty much done the same thing day after day for an entire month. Dips get bought. Gap downs get bought. The S&P has moved up 20 of 25 days, and we haven’t had two consecutive down days since mid December. This one-directional movement can’t last, but guessing when it’ll end has been painful and frustrating for the bears.
Tomorrow is a FOMC announcement. It would be too easy and make too much sense for the market to rally into the meeting and sell off afterwards. More likely, if a correction is to play out soon, it’ll start today or get delayed until a day or two after the meeting.
My near term upside S&P target (should the market continue up) is 1330. Beyond that I’m eying 1350. On the downside, I’m expecting 1298ish to get hit if sellers step up, and beyond that 1270.
Don’t get lazy out there. Take partial profits and get rid of stocks that aren’t keeping up…or at least move stops up to protect your capital. The risk/rewards for aggressively entering new longs is not great considering the steady flow of up days we’ve had. 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 24)”

  3. Still net long, but closing some positions. Still looking for a pullback and add in opportunity.
    Indeed the upcoming congress posturing and prez race nonsense needs to be factored in.
    Focused on US equities but looking to china for opportunities.
    Let see what happens after the gap close down.
    BVSN still strong but today could be the blow off top.
    Some group strength rotation still going on, may all weaken by Friday.
    Best of luck.

  4. So far, it appears that the move down from yesterday’s SPX high is a corrective affair and may be part of an evolving wave 4. A .618 retrace of the decline so far would take price back up to the opening level at 1316ish and fill the opening gap. If SPX gets there, I’d look for a reversal as a place for a low risk short position.
    Wave 4 can take all kinds of shapes but I think the 1290ish area (where the 20 day ema & midpoint of the daily bollinger band are) is a reasonable downside target. But first things first. I also note that, since JAN began, the 10 day ema has been solid support on pullbacks and now sits around 1302-1303. If we move sideways, a wave 4 triangle formation would be something to look for prior to a wave 5 advance.

    1. I think trying to trade a 4 is risky. Tight stops with a high probability to just break even or lose a bit of ground. If develops into a triangle, your profit goal will be elusive and odds favor the execution of a stop when 5 has begun. I see breaks on the top and bottom of my converging trend lines of the diagonal. I can’t rule out now that it is already done at this point. Pattern is to ambiguous to trade for me.

  6. last time AAPL released earnings it tanked in after mrkt.
    Against better judgement looking to hold 1/3 or more of my position into earnings depending on last 1 – 1/2 price vol action.

  7. FIO maybe setting up to break out on an IPO U turn (mass storage / cloud play).
    BIDU is at or near a bounce pt, keep in mind China mrkts are closed and bidu is supposed to report Monday. Historically it has ramped up into earnings popped then decayed. Its acting different now, so be careful.
    The same for TSL rebuy, somewhat iffy now but resting at prior break out area.
    FTK may also be rolling over, cashed out over 1/2 my posn yesterday & today.
    Looks like BVSN topped today, one of the few times my timing was on, out yesterday (yes, I know I am being an arrogant ass ;), but my biggest winner in this year).
    Best of luck.

  8. The advance from today’s SPX low has the look of 3 waves (abc) with wave “c” now in progress. If so, wave “c” will equal wave “a” at 1319ish – above the 1316, a .618 retrace of yesreday’s high to today’s low as previously mentioned. But, wave “c” will be .618 of wave “a” at 1316ish. I find these Fibo .618 relationships interesting in that it often occurs at reversal points in various time frames.
    So, a continuation upward into SPX 1316-1319 followed by a recognizable reversal would,IMO, be a low risk shorting opportunity.

    1. AAPL may gap then dump tomorrow, to bounce again.
      Still think a split like the BIDU 10:1 during its last 200% of its total 1000% run from the 2009 bottom may play out for AAPL.

  15. And I believe china is closed this wk reopens next Monday I believe.
    As for TA & FA of the markets there is no precision, only tendencies. It does not operate under reasonable nor strict physical laws like Newtonian mechanics. This is how we traders sometimes egged on by the gurus and pundits ‘bleep’ ourselves up our portfolios. Sometimes its best to try to go with the trend no matter how jagged the path and how jagged our opinions until it bends.
    If you are a CANSLIM or Mike Turner fan AAPL has the TA and FA criteria of both systems.
    Like the great retail traders of past and present have have stated
    When the markets go sideways I look for Darvas (growth) stocks – N Darvas
    I never made any money following the indices – D Zanger
    Monitor the leadership (or something like that) – Dr C Kacher / G Morales
    Follow and look at which stocks and groups are the leaders – an unknown but great retail trader
    BTW – forget the eIBD and eIBD Meetup ‘mentors’ and ‘gurus’. I doubt if they trade and if so their performance must suck.
    All the best.

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