Hello! Here’s what’s happening in the market today…
News:
The bears, pundits, and naysayers are calling for a crash. Yesterday the market opened red … and plummeted.
I was traveling and not able to watch the whole saga play out. But when I stopped for lunch the pattern was clear to me.
Support was holding. The SPY refused to break down. Buyers stepped up at the exact levels one would expect. Today the story is in the charts…
Technicals:
The lines on these charts are old. All I did was add a few circles. Let’s start with the SPY.
Now let’s look at QQQ which tracks the biggest 100 stocks in the Nasdaq Composite…
When I stopped for lunch everything was near the bottom of the day. I bought TQQQ to leverage my buying power. It was an easy trade. If it closed below support I’d exit the trade. There was little risk.
As a pointed out yesterday … Prices needed to sink low enough to attract buyers. And yesterday that’s exactly what happened.
As the afternoon wore on buyers pushed the market higher and the Nasdaq/QQQ ended up closing green after shedding more than 2% in early trading.
This morning all the technical signals I’m watching are bullish.
The VIX is holding in the high teens. (Bullish)
The put-to-call ratio is near oversold. (Bullish)
RSI readings are near oversold. (Bullish)
Even Bitcoin appears to have found at least a short-term bottom.
Timing:
January is historically the best month for the Nasdaq which is why I chose to trade TQQQ.
Futures are up this morning.
Today I’m generally bullish and moving towards risk on. I could add to my TQQQ position if we get a nice dip. My profit target is $160-170+.
Watchlist:
*CELZ is on watch
IRTC has support at $120
LQDA has support at $6.50
ASRT has support at $2.75
F has support at $22