March 24, 2016
A lot has been going on in the markets and at Wealthpress for the past week. I want to thank you all for the success of my programs and for sticking with me through the ups and downs of the markets.
I hope you all didn’t miss my personal story where I talked about what got me into trading. It’s been a long time but it’s always good to remember where I first got started.
Check out the story here
Without further adieu, let’s jump in and take a look at what has been going on...
As of Friday, the SPY has pulled back after making new all-time highs back on May 1, 2019. It is continuing to balance just above its 280 price level, which marks the baseline of a descending triangle (bearish price pattern).
The overall context is neutral to bullish above the 280 price level.
There’s been a breakdown below the 280 price level that would suggest short-term weakness and Bears being in short-term control.
This would likely result in a test of the SPY 200-day moving average (at/near the 275/276 price levels) or at the support level just below the SPY 200-day moving average (at/near the 272/271 price levels).
The NASDAQ, similar to the SPY, is showing weakness and testing key price levels of 178/177 which is a break-down below 177.50. This likely suggests short-term weakness and Bears in short-term control, but there's still one stock that looks resilient regardless.
This is resulting in a test of the QQQ 200-day moving average (at/near the 174 price level) and/or potentially lower to/near the 170/169 price levels.
The Russell is the weakest out of all the indices. The IWM has already broke-down below key support at the 151 price level. At this point, sellers are in short-term control. Next major support is the 149/148 price area.
The TLT (Bond Market ETF) is experiencing an upside break-out above key resistance and printed new highs this week
The VIX spiked on May 9, 2019, and is continuing to hold above its 50-day moving average which suggests increased volatility in the markets.
It is still holding below 20 at/near 16, it’s too early to suggest there is fear in the markets and to call the market bearish. The VIX has confirmed that the market is neutral
The Put/Call ratio reflects 1.21 as of market close on Thursday 5/23. It suggests extreme put buying.
Overall, the SPY may continue to balance between its 50-day moving average and the SPY 280 price level for a few more weeks.
This would likely result in a test of the SPY 200-day moving average (at/near the 275/276 price levels) and/or that support level just below the SPY 200-day moving average (at/near the 272/271 price levels).
For the past week XLU (Utilities), XLP (Consumer Staples), and XLRE (Real Estate) have been the strongest sectors.
The weakest sectors have been XLE (Energy), XLB (Materials), and XLI (Industrial).
Money has been moving into defensive stocks recently. I believe this is due to economic factors such as the trade war with China. Many investors will buy defensive stocks when they believe a recession is likely to occur in the short-term.
That being said, I still have a watchlist for you guys and these stocks should be on your radar. But there's ONE "Lightning Stock" that I really want to show you, click here to see it.
The first stock is EL (Estee Lauder Companies) - a Consumer Staples stock. The Estee Lauder Companies Inc. is one of the leading manufacturers and marketers of cosmetics, fragrance and hair care products.
The stock has pulled back into prior support levels that are in line with its 50-day moving average. This is following a new 90-day high. The expectation is for the stock to resume back to the upside in the direction of the main trend.
Buying anywhere below the 165.70 price level is below fair value. 165.70 to 163.30 are more aggressive support levels followed by 163.30 to 160.90 which are more conservative support levels.
A break below the 161/159 price area would likely result in a break-down to the 155/153 price area.
Logical profit objectives are a re-test of the 172/173 price area followed by a re-test of the May 1 prior swing high at/near the 178/180 price area.
The second stock is CBRE Group Inc (CBRE). It is a Real Estate stock. CBRE Group, Inc is a commercial real estate services firm.
This stock has pulled down off of a double top into deeper support levels. On Friday, the stock gaped open higher and traded higher heading into the afternoon session.
Given the continued relative strength we’re seeing in the real estate sector, our expectation is for this stock to continue to trade higher.
Buying anywhere between the 48 and 49 price levels is more aggressive, however, this stock may not offer up another opportunities. More conservative support levels are between the 47 and 48 price levels.
A break below the 46.50 price level would likely result in a break-down to the 45/44 price area.
Logical profit objectives are a re-test of the 50/51 price area followed by a re-test of the double top (prior swing highs) at/near the 52/53 price area.
Make sure to keep an eye on these two stocks because they are sure to make explosive moves.
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