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You should have closed out the OI spread yesterday, booking a profit of about 78% for a month.
And I suggested you sell calls against the FEYE position. This alert only?applies if you are long the stock.
Yesterday market the third consecutive day that the S & P 500 closed to the downside.
For the day, the S & P 500 closed at 2,802.60, down 16.22 points. And it closed at 19% of the range of the daily bar. This puts the odds of yesterday's low being violated before the high at around 80%.
The key for today will be to see if last week's low of 2,795.14 can hold as support. I do expect a test of that low. The low also happens to be within 2 points of the major 2,793 support level.
At this point, if 2,793 is taken out, the key level is the confirming line just under, which is 2,780.78. This is for two reasons.
The first is that when a major level is violated, it will often run to the next downside level and find support there.
And the second is that if the S & P 500 were to close for two days under 2,780.78 it would indicate the market should continue down to 2,744.10.
I do need to point out that a drop to 2,744.10 would be considered a 'normal' pullback in a bull market. This would be a two level drop and completely acceptable.
The last pullback we saw in the market was also a two level drop.
That was drop on June 13th when the S & P 500 hit 2,791.47 and dropped to 2,691.99 on June 28th.
Those reversals happen to coincide with the 2,793 and 2,695.30 levels.
Resistance from yesterday's daily price bar is in the 2,810 area.
The short term 30 minute and 60 minute charts remain bullish for the S & P 500. This does indicate that the markets should bounce once support is found.
The NASD market is bearing the larger brunt of this pullback. But, this should really be a big shock due to the fact that a lot of NASD stocks were at or above their upper bands on their daily charts.
Earnings continue this week, with Apple and BIDU reporting this afternoon after the close.
Pre open, the S & P 500 is trading about seven points higher. Watch the resistance level from yesterday's daily bar.
Continue to monitor the longer term levels for the market.
Here are the Key Levels for the Markets:
$VIX:
Major level: 31.25
Minor level: 29.69
Minor level: 26.56
Major level: 25.00
Minor level: 23.44
Minor level: 20.31
Major level: 18.75 <
Minor level: 17.19
Minor level: 14.06 **
Major level: 12.50 <
Minor level: 10.94
The VIX closed at 14.27. Yesterday was the first close above the 14.06 level.
This now implies that if the VIX closes above 14.06 today it should test the 18.75 level.
On the upside, the VIX will need to clear 14.84 to head higher.
12.50 should now be support. And 13.28 should also be support.
SPX:
Major level: 2,890.60
Minor level: 2,878.40
Minor level: 2,854.00
Major level: 2,841.80
Minor level: 2,829.60 **
Minor level: 2,805.20
Major level: 2,793.00
Minor level: 2,780.78
Minor level: 2,756.33
Major level: 2,744.10
I am looking for a test of 2,793, but minor support is at 2,797.90. If the S & P 500 breaks under 2,797.90, I would look for a drop to 2,773.40.
Also, 2,776 is technical support.
Watch the minor 2,822.30 level. If the S & P can clear this level, I would expect support there.
QQQ:
Major level: 187.50
Minor level: 185.94
Minor level: 182.81
Major level: 181.25
Minor level: 179.69 **
Minor level: 176.56
Major level: 175.00 <
Minor level: 173.44
Minor level: 170.31
Major level: 168.75
The QQQ closed at 175.11. Yesterday's low took out the 175 level.
173.44 is the minor level on the downside to watch. If the QQQ breaks under 173.44, it could test 168.75.
178.13 is minor resistance on the upside.
IWM:
Major level: 171.88
Minor level: 171.10
Minor level: 169.53
Major level: 168.75
Minor level: 167.97
Minor level: 166.41
Major level: 165.63 <
Minor level: 164.85
Minor level: 163.28
Major level: 162.50
The IWM closed at 164.20. Short term support is at 164.84. A close today under 164.84 and the IWM should test 162.50.
Resistance is at 165.63.
TLT:
Major level: 125.00
Minor level: 124.61
Minor level: 123.83
Major level: 123.44
Minor level: 121.49
Minor level: 120.70
Major level: 120.31
Minor level: 119.92 **
Minor level: 119.14
Major level: 118.75
The TLT closed at 119.05. The TLT came within 22 cents of the 118.75 objective.
I don't see the TLT breaking under 117.97, but if it does, it should continue lower.
119.53 is minor resistance.
GLD:
Major level: 120.31
Minor level: 119.92
Minor level: 119.14
Major level: 118.75
Minor level: 118.36
Minor level: 117.58
Major level: 117.19 <
Minor level: 116.80
Minor level: 116.02 **
Major level: 115.63
The GLD closed at 115.65. It closed two cents above the 115.63 objective.
A break under the 115.63 level and the GLD should continue lower. 115.63 is a major level for the GLD.
If the GLD breaks under 115.63, the next major level is 114.84.
On the upside, 116.41 should be minor resistance.
XLE:
Major level: 78.13 <
Minor level: 77.35
Minor level: 75.78 **
Major level: 75.00
Minor level: 74.22
Minor level: 72.66
Major level: 71.88
Minor level: 71.10
Minor level: 69.53
Major level: 68.75
The XLE closed at 77.26. The objective for the XLE should be to 78.13.
Support should be at 76.56. And minor resistance is at 79.69.
FXY:
Major level: 86.72
Minor level: 86.53
Minor level: 86.14
Major level: 85.94 **
Minor level: 85.75
Minor level: 85.36
Major level: 85.16
Minor level: 84.97
Minor level: 84.58
Major level: 84.38
The FXY closed at 86.17. At this point, 86.72 should be resistance.
85.94 should now be a minor support level.
AAPL:
Major level: 200.00
Minor level: 198.44
Minor level: 195.31
Major level: 193.75 <
Minor level: 192.19 **
Minor level: 189.06
Major level: 187.50
Minor level: 186.72
Minor level: 185.16
Major level: 184.38
Apple closed at 189.91. Look for a move to 187.50.
189.06 is a minor support level. If 189.06 is taken out, look for Apple to head lower.
Apple does report this afternoon after the close, so wait to see how they report.
WATCH LIST:
Bullish Stocks: AMZN, GOOGL, ORLY, SPY, DIA, FLT, COST, AMGN, AET,
CXO, GRUB, EOG, UHS, BDX
Bearish Stocks: TSLA, ITW, WHR, SWKS, NXPI, JACK, LAD, SMG, WDC, SEIC, PZZA, WGO
Be sure to check earnings release dates.