It was a massacre yesterday with global markets tanking in upwards of 3.5%, as the most shorted stocks continued to skyrocket on pure stupidity. The S&P500 saw an overnight session low of 3,703.75, which is the bottom of our white channel, and where the 50 day MA is sitting on our SPY chart. We mentioned in our analysis yesterday, that if the 200MA (h) broke, which it did, that we could see a test of this level. We're seeing a notable bounce here in pre-market trade but we're a mile below the important 21 day EMA, which should now act as resistance. Vix saw a 37 handle in aftermarket trade yesterday, and ended the day up a whopping 61%. As hedge funds continue to suffer massive losses from these running short squeezes, they're forced to liquidate their long positions in the most loved companies. This could be why we're seeing broader market weakness this morning despite strong quarterly earnings reports.
We saw Apple, Tesla, and Facebook post mixed earnings, however Apple saw beats across the board, and is still trading down around 1.5% pre-market. Tesla is suffering after an ugly earnings report, which also lacked forward guidance, we're down aroun 4%. Facebook is still losing members rapidly, and apparently sees difficult times ahead, also. This is putting some pressure on the stock, even though they beat on revenue. We're currently down around half a percent.
European and Asian markets continued to sell off today, with the FTSE down around 0.85%, and the Hand Seng down by as much as 2.5%. Jobless claims came in better than expected because all you have to do is raise the expectations, right? 847K Americans filed for first time jobless benefits last week, with 4.77 million continuing claims. Q4 GDP came in weaker than expected at 4% vs 4.4% expected. Wholesale and Retail inventories rose modestly by 1% and 0.1% respectively.
In rates, the 10Y yield is sitting around 1.02% after hitting a session low of 0.998%. We're sitting just above the 50 day MA at .963%, and I expect a potential test of this level in the interim, before we continue to trend upward. The dollar (DXY) is poised to open near the key neckline in our IHS around 90.75, which I remind traders is above the longterm descending resistance trendline, which we broke through yesterday with conviction. The Put/Call is sitting around .50 as we approach the open, and is incredibly skewed considering the day we had yesterday. Traders clearly don't think this is a real correction. For most traders sake, I hope they're right.
Gold is catching a bid this morning, and we're up around half a percent. Bitcoin remains in a strong downtrend, but is catching a bid this morning, also, and is up around 4%. We're seeing strong support at the 50 day MA, so we may see further upside into the final day of trade for the week, tomorrow.
We'll be watching the SPY closely for a break below the 50 day MA, which would also see the white channel break. If I dare say it, I'm going to call the top of the megaphone as the next major support, and my friends, if it breaks, the 100 day MA (354.90) comes into play, and then it's straight shot to 340, and then the 200 day MA at 333.50. Resistance overhead at the 21 day EMA.
Thanks for your time today guys, I hope you enjoyed the analysis. Don't forget to join us over at the Hedge of the World website as we disseminate the day's price action in our live daily play-by-play to begin shortly. Remember, expect the unexpected. Cheers, Michael.
*The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. I am/ we are currently holding positions in UVXY, HUV, HQD, QID.
We saw Apple, Tesla, and Facebook post mixed earnings, however Apple saw beats across the board, and is still trading down around 1.5% pre-market. Tesla is suffering after an ugly earnings report, which also lacked forward guidance, we're down aroun 4%. Facebook is still losing members rapidly, and apparently sees difficult times ahead, also. This is putting some pressure on the stock, even though they beat on revenue. We're currently down around half a percent.
European and Asian markets continued to sell off today, with the FTSE down around 0.85%, and the Hand Seng down by as much as 2.5%. Jobless claims came in better than expected because all you have to do is raise the expectations, right? 847K Americans filed for first time jobless benefits last week, with 4.77 million continuing claims. Q4 GDP came in weaker than expected at 4% vs 4.4% expected. Wholesale and Retail inventories rose modestly by 1% and 0.1% respectively.
In rates, the 10Y yield is sitting around 1.02% after hitting a session low of 0.998%. We're sitting just above the 50 day MA at .963%, and I expect a potential test of this level in the interim, before we continue to trend upward. The dollar (DXY) is poised to open near the key neckline in our IHS around 90.75, which I remind traders is above the longterm descending resistance trendline, which we broke through yesterday with conviction. The Put/Call is sitting around .50 as we approach the open, and is incredibly skewed considering the day we had yesterday. Traders clearly don't think this is a real correction. For most traders sake, I hope they're right.
Gold is catching a bid this morning, and we're up around half a percent. Bitcoin remains in a strong downtrend, but is catching a bid this morning, also, and is up around 4%. We're seeing strong support at the 50 day MA, so we may see further upside into the final day of trade for the week, tomorrow.
We'll be watching the SPY closely for a break below the 50 day MA, which would also see the white channel break. If I dare say it, I'm going to call the top of the megaphone as the next major support, and my friends, if it breaks, the 100 day MA (354.90) comes into play, and then it's straight shot to 340, and then the 200 day MA at 333.50. Resistance overhead at the 21 day EMA.
Thanks for your time today guys, I hope you enjoyed the analysis. Don't forget to join us over at the Hedge of the World website as we disseminate the day's price action in our live daily play-by-play to begin shortly. Remember, expect the unexpected. Cheers, Michael.
*The information and analysis shared in this post is not financial advice. Always conduct your own analysis and research. I am/ we are currently holding positions in UVXY, HUV, HQD, QID.
