Rob is watching THESE markets to start the week. You should too

Welcome back! Let’s take a look at several different market issues. First things first, as we look at the daily charts. If we look at the last year-and-a-half with the resistance. We need to look at the 27,000 area on the Dow. It’s pushed back and hasn’t started rallying yet. 27,000 is really considered resistance from my perspective. We have not officially made this support yet and it’s important.

Also, the Russell is a leader, not a follower. It’s been very weak. It closed out the bottom quarter of the range. First things first, what I’m watching in the big picture, I’m watching the key resistance levels. The Nasdaq performed the best. It closed just a hair above the speedlines. Whereas the Dow closed under the Nasdaq. I want the S&P, the Russell, the Dow and the Nasdaq to be trading above those speedlines to get excited about longs. Note those areas 27,225 area, the 1556 area, the 2994 area on the S&P. Those are some key areas that we’re already above on the Nasdaq. The Nasdaq is coming into earnings and there’s some hot expectations for earnings. It better not disappoint like Netflix. On the bigger picture, we have not made that long-term resistance support yet. On the daily charts, we have those key resistance areas. If we start breaking down on the lows, that could bode very well for selling if we start coming into this process and accelerate to the downside. When the Russell was performing badly, that caused me to focus on short-side trades. As I was doing my Live Trading Room for my BBT Insiders that I do each month, I did live trades on the screen in front of them shorting the stock indices. That was the right call and it put money in my pocket this morning. Watch what’s happening with that Russell. If that doesn’t shore up pretty fast and break below it’s lows, then I’m going to look to benefit from that.

As far as Netflix, people are asking if it’s okay to short it now. We had buy side indications on Netflix. It went right up to target 1, stalled and rolled over to sell side signals. That was three whole days before. The fourth day it gaped down. Plenty of warning on Netflix. Netflix gaped down and opened up below target 2. Once we get down below target 2, that’s where we can accelerate. The next day it opens up, went up first and went back down. That’s called a gotcha bar. That led to continuation short-side trades. It dropped significantly about $18 or so. If you look at risk/reward. Round number support/resistance, basically what we have at this point is the 300 round number support below us and even just a small reversal back to the original target 2. The risk vs. reward doesn’t add up for fresh shorts for Netflix. You’re either in up here or you’re in after the initial gap down where we had the gotcha bar. At this point there’s not enough support. We’ll look at that and other opportunities in the days to come.

Right now, these intraday opportunities are a sweet spot. We’ll give you the swing trade updates as we go forward into the coming days.

Have a great night!

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[Market update] watch THESE stocks on Monday

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