Yesterday Q1 2022 ended. It was the first quarter in two years in which the major indexes all posted a decline. Markets closed at their session lows. The big three dropped about 1.5% each. The Russell 2000 fell just 1.0%.
Commodities closed their best quarter since 1990.
The conflict in Ukraine has no end in sight. The Ukrainian military seems to have the advantage at the moment, retaking Chernobyl after the Russian fell ill and fled.
Energy is still weighing heavy on the market. Oil has dropped below $100 on news that the Biden administration will release up to 1 million barrels a day from the country’s strategic reserves.
Biden also called on oil companies to drill. He claimed 9,000 permits are currently unused and suggested a “use it or lose it policy.” This could benefit Devon Energy (DVN^) and EOG Resources (EOG) since their the top permit holders according to Bloomberg.
In meme stock land GME^ shot up ~15% after the close yesterday. It announced plans for a stock split, joining TSLA^ and GOOG/GOOGL.
The Dow fell to a critical support level. See the chart below…
The VIX is still low even after yesterday’s sell-off. RSI levels and the put-to-call ratio are in a neutral stance.
I’m building a strong bull case for today. If we close below support my theory will be invalidated, but this is looking like a buy to me.
The first trading day of the month accounts for about 33% of all stock market gains.
April is the best month of the year for the Dow and the S&P 500.
The Dow is at support, technicals are bullish, it’s the first of the month, and it’s April! All signs are pointing higher.
Keep an eye on the jobs report due out at 8:30 this morning. I’m not expecting any fireworks but a surprise could disrupt my theory.
I’ve exited most of the trades that weren’t working. Positions still open are noted below.
Cut your losers short and let your winners run!
*IMTE is on watch
^*SGLY profit target $16+
*HMLP has resistance at $8, support at $7
FLNG has resistance at $29
^NEXT has support at $6
PLAY has support at $48
VTNR has resistance at $10
^GME has resistance at $200
^LXU has support at $20
^GLNG has resistance at $25