new year, new volatility, new fun

spy60DON’T FORGET the $1 Trade Risk Premium Trial is still on the table for the month of January!

$SPY quite the roller coaster start to the new year as we completed our first full week of trading with a violent 2 day sell off followed by a swift 2 day bounce, only to close off the highs and flat on the week. Looking at this hourly chart we can see we’re smack in the middle of this 199 to 208 wide intermediate range and we are teetering on the top of open gap support at 204 from Thursday’s session. We’re in a trendless state on this time frame within the context of a long term uptrend. I’m neutral on the market here ready to act if the market moves in either direction. My portfolio does have a few longs on that have been outperforming and that are in clear uptrends, but my stops are tight. The bulk of earnings season is fast approaching and it would make sense for the market to chop around until it can get some new insights on how companies are doing. Try not to overtrade a choppy market environment and be aware of the increased volatility.

iwm60$IWM the small caps suffered a swift down draft coming into the new year but since that initial wave of selling we’ve seen about a 50% retracement. Similar to the $SPY we are resting on the top of open gap support and we’ll see next week if the bulls can defend this area and keep the near term momentum in their favor.

aaplDaily$AAPL remains higher on the year, and had a very solid week as it found support around 105 making an impressive bounce into resistance around 114. The action in Apple is still very constructive and the uptrend is very much in tact. In the near term we probably need to see some sideways action develop within this range before making a sustainable move back to all time highs. Wait and see on my list, as I am still interested in a breakout above 114.

nflx60$NFLX is a name that is looking pretty vulnerable to lower prices if this band of support around 320-325 is broken. It’s a short setup I’ll have my eye on next week if we do see that breakdown start to play out. The bulls have alot of work to do in this name, and at this point, they’re not getting it done.

twtrDaily$TWTR a great start to 2015 for this one as Twitter has cleared an important level of resistance on Friday as it closed back above $40. There’s alot of supply in this area between 39 and 42 so Twitter bulls are certainly not out of the woods yet. The 42 resistance is likely going to be a tough area that could take some time to break up and out of. Overall, it’s a great start by the bulls as they’ve done some tough work at these levels in an otherwise messy market environment. I’d be interested in Twitter above 42, but I’ll need to see how it acts if / when it gets there. On watch.

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Evan Medeiros

Evan is the founder of the Trade Risk. With 20+ years of coding experience and a B.S. in computer science, Evan brings a systematic discipline to investing in the stock market.

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