MR
MARKET SNAPSHOT
Dow 19833.81 -111.36 (-0.56%)
Nasdaq 5438.55 -48.89 (-0.89%)
SP 500 2249.92 -18.96 (-0.84%)
10-yr Note +12/32 2.516
NYSE Adv 791 Dec 2166 Vol 734.9 mln
Nasdaq Adv 764 Dec 2245 Vol 1.21 bln

 

IN THE NEWS HIGHLIGHTS:

  • Expect low volume this week.
  • US markets sell off.
  • Crude oil ends flat after a tumultuous day of trading.
  • U.S. Dollar Index rallied to its previous high.

 

RECAP– The market sold off today from the opening bell and maintained a bearish bias until the closing bell. Crude oil saw a lot of volatility today in the market with huge rallies and selloffs, but ultimately ended the day flat. The US Dollar retested its historic highs while precious metals such as gold and silver are seeing a little relief.

In-depth look of daily news at Briefing.com (CLICK HERE)

In-depth look at after hours movers (CLICK HERE)


Economic Calendar

Today

  • Nothing major today.

 

Upcoming Reports

  • December 29: Unemployment Claims
  • December 29: Crude Oil Inventories

 

FedWatch February 1 Rate Hike Probability for December 28: 4.0%  (View the probability chart here)


A Look At The S&P 500 Chart – KEY Levels

  • RSI is above 50.
  • On Balance Volume is above its moving average.
  • Same as last week, not much to look at this week. This is very similar to the summer “lull” that we experienced in July and August.
  • The market is consolidating while trading in smaller ranges.
  • We should continue to expect low volume (note the significant dropoff in the past week).
  • Market looks overextended, having gone nearly two months of exceptional bullishness without a significant correction.
  • The market sold off today from the opening bell. The bearish momentum was steady and consistent up until the final 2 hours where it consolidated.
  • 2240 on the S&P futures (/ES) and 2250 on the SPX cash index would signify and significant level of near support and the lower end of the trading range for the past two weeks.
  • For those who follow the TRIN, it is beginning to trend more “bullishly” with today’s close at 1.51. I look to a close above 2.0 as a short term bullish reversal.

 


A Look Into the Heat Map

All sectors traded in unison today and the market was clearly bearish.

MARKETS

(click on symbol for chart)
SPX –  Bullish
DOWBullish 
Nasdaq Bullish  
Russell  Bullish  

VIX – 12.88

 COMMODITIES

Oil (USO) –  Bullish – Oil looks strong and in breakout territory.
Ag (DBA) – Bearish
GLD –  Bearish – Gold is remaining in a bearish slump with the strengthening in the dollar.
SLV –  Bearish – Same as gold.

THE DOLLAR

UUP USD weighted ETF –  Bullish

 


SOLON’S TRADING THOUGHTS

This should be another slow week in the market with very low volume. Trading directionally will again be difficult. With the lack of volatility and movement, this is a great environment for theta traders and options sellers. The lack of movement in the market while theta is decaying benefits those trades. Reflecting upon last year, this was a good week to take profits on trades where you could get them as volatility is shrinking and will not likely get lower. Also, if I’m looking to get into new trades, I’m looking more to debit spreads and calendars as volatility will only pick up in the beginning of the year as institutional traders come back into the market, thus benefiting those trades.

I wouldn’t make too much out of today’s trading activity. This was just a slight correction following a long period of bullishness. With today’s selloff, the market is back at the lower end of a trading range that it has been confined to for the past 2-3 weeks. I would expect a more significant selloff in the new year after all the institutional traders get back from their winter vacation.


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