Thursday, January 9, 2020

Market Update 1/9/2020 - Is This The Big Pump and Dump Ahead of Earnings Season?

Trading has been pretty wild over the past couple days, with gold, and oil spiking, ahead of the World War 3 trade, that wasn't. It's nice to get back to normal trading, on decent volume, and nail every market move over the past 2 days. I even warned people not to chase the action into the close, and that turned out to be good advice.

Sadly, unless you trade futures contracts, you missed an easy 100 handles on an overnight swing trade.

Tuesday night we saw market futures gap down 50 SPX points to some very obvious support levels (pointed to in previous updates;DOW 28200; SPX 3200), followed by dip buyers coming in at support, and futures recovering by the next morning, and by the end of the day the NASDAQ and the $SPX, has taken out new all time highs!  It wasn't until the end of the day, that we finally saw a little run for the exits, on reports that the Iranian backed militia had once again fired a couple missiles into the so called green zone, near the US embassy. This is nothing new, by the way, see:
"Since September 2018, IBG militants have fired over 30 rockets at U.S. facilities in Iraq, including the U.S. embassy in Baghdad..." csis.org 

It's only now that this escalation, on Iran's part, is being reported, and Trump blamed.... of course. 

Tuesday nights trade reminds me of the night Trump won, and the main stream media was pushing the market collapse story, as DOW futures crashed over 1000 points, and predictably the short sellers were crushed the very next morning. It was probably one of the worst head-fakes I've ever seen, second only to the rebound off the 2008 lows.

So, now that the short sellers are trapped again, and earnings season doesn't start for another week, I think this short squeeze can continue.

Last earning season was "not as bad as expected", and I suspect this one is going to be "in line with expectations", or even "better than expected". That presents the perfect pump 'n' dump scenario. Short capitulation, followed by profit taking, on good news.

$SPX - Short term: This morning I didn't have any trouble finding a bullish channel on the 1 min chart, and this morning I'll be replacing the 15 min chart with this one.

$SPX - 1 min. Looks like a pullback in wave "a". Futures are up, but I'd expect another pullback ahead of the weekend. Could even see another Short Squeeze Friday, if we can complete consolidation, by the end of the day.




$SPX 10 min view. Res is the black line, and that's where futures are pointing. This the chart you'll find in the public charts area.


$NDX  - Of course tech has to lead. Found this 9450 (Feb) target, on a 3 year chart view. 


DOW - I wanted to nail down the same target on the dow, and you can see where it's having trouble breaking out above res. I had to go to a 4 year chart to find this channel.


Watch the public charts, and the $VIX alerts, and if I'm helping you trade, then you can help me keep the charts coming, by making a donation to this website.
I don't have time to cover Oil, or Gold, but you'll find those chart in the public charts area.
Opening bell opens in 5 min, and I still have some chart updates to do.
Good luck, 
AA



 



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