Weekly Wrap-Up + Market Forecast + Sector Watch: SPX, Nasdaq, FAS, BTK, FDN, GLD

Last weekend, in my Market Forecast, I wrote:

"For the new week, the market will start out with a neutral stance, albeit leaning a bit more towards bullish. I think there is a chance that SPX will re-test 1980, or perhaps even 2000."

Well, things pretty much happened as predicted. On Monday, things struggled to find a real direction. But, buyers came in in full force on Tuesday and continued all the way until just before the Fed's rate announcement on Thursday. By that time, SPX was hovering right around 2000.

On Thursday, before the Fed announcement, I said in our Chatroom:
"...we might see a flat market today... a lot of people are expecting big movements... so, what might happen today is "nothing"... real movement may come tomorrow or next week..." [8:55 am] PST

That was what exactly happened as well! Right after the Fed announced "no rate change", markets were volatile. But, when Yellen came on TV to further detail Fed's decision, stocks rallied. SPX went up another 20 points to test 2020. During that time we picked up GOOG calls and made a quick, nice trade:

We locked in the quick profit because I did not expect the gains to hold. Sure enough, before the market close on Wednesday, SPX came back to flatline, and went slightly negative for the close.

Friday was the "real" move after the Fed, as the markets dropped, with SPX losing 1.62% to trade below 1960! We captured the downside with some puts. Here are the closed trades for the week:

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For the week, the Dow was down 48.51 points; SPX fell 3.02 points; Nasdaq added +4.89 points. Oil (WTI) fell to trade at around $45/barrel. Gold got a good pop to trade just below $1140/ounce. At the time of this writing, Asian markets were mostly down. Here are how the US markets closed on Friday:


On Friday, SPX fell 32.17 points to close at 1958.03. It closed below its 10-day MA. The MACD flattened.


Nasdaq tumbled 66.72 points to close at 4827.23. It managed to stay above its 10-day MA. Both SPX and Nasdaq rallied all the way back up to test its daily MAs. After briefly rising above their respective 30-day MAs, sellers came in again. Although Nasdaq appears a bit strong, the two indices tell the same story: Markets bounced back to test the 30-day MA, respectively, on both SPX and Nasdaq. But, both failed to stay above it, for now. Then, they both came down to test their respective 10-day MA. Nasdaq managed to stay above, while SPX fell below.

For the new week, we might see a bounce to test SPX 1975, or around there. Then, we will have to see if the markets can keep bouncing or fall back down. On the up side, SPX has resistance at 1975 to 1980. On the downside, we might see the market test 1910-1900.

Financials are still very weak, and still look oversold. Biotechs and internets have traveled quite far from their recent lows. Gold may be interest to watch now.

Sector Watch

FAS (financial)

FAS closed just below its 10-day MA. Big banks (GS, BAC, JPM, WFC) are all basically telling the same story. We could see a quick pop in this sector.

FDN (internet)

FDN looks neutral here. We will have to see how things play out. FB, AMZN and GOOG remain strong, but, are starting to show weakness. TWTR has just turned bullish.

BTK (biotech)

BTK's next move could be very important in determining the market's next big move. CLVS has been on an incredible rise. GILD, AMGN, CELG, BIIB are all in neutral grounds. JAZZ could see a bounce in the coming weak.
GLD (gold)

GLD rose above its daily MAs. Its daily MAs flattened and the MACD went up. We could see a rally in gold!

Good night and HappyTrading! ™

Posted to Ecstatic Plays on Sep 20, 2015 — 11:09 PM
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