To gain an edge, this is what you need to know today.
Stock Market Breaks Out
Please click here for a chart of S&P 500 ETF (SPY) which represents the benchmark for the stock market index (SPX).
Note the following:
- The chart shows that the stock market has broken out.
- The chart shows the breakout that occurred after the trend line held.
- RSI shown on the chart is slightly overbought but there is more room to run.
- There is enthusiasm after a strong jobs report on Friday.
- Investors ought to look at different time frames. Even though there is a breakout, in the very, very short term, the rally can stall and even a shallow pullback can occur.
- 4200 on S&P 500 is a new magnet for traders.
Hiring Goes Gangbusters
The U. S. added 916K nonfarm payrolls vs. a consensus of 627K.
Nonfarm payrolls expanded to 780K vs. 470K consensus.
Momo Crowd And Smart Money In Stocks
The momo crowd is 🔒 (To see the locked content, please take a 30 day free trial) stocks in the early trade. Smart money is 🔒.
The momo crowd is 🔒 gold in the early trade. Smart money is 🔒.
For longer-term, please see gold and silver ratings.
The momo crowd is 🔒 oil in the early trade. Smart money is 🔒.
For longer-term, please see oil ratings.
Our very, very short-term early stock market indicator is 🔒. This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.
Interest rates and bonds are range bound.
The dollar is weaker.
Trading futures is not recommended for most investors. The purpose of providing this information is to give an indication of the premarket activity that usually guides the activity when the market opens.
Gold futures are at $1724, silver futures are at $24.90, and oil futures are $59.88.
S&P 500 futures resistance levels are 4200, 4318 and 4400: support levels are 4000, 3950 and 3860.
DJIA futures are up 243 points.
Protection Bands and What To Do Now?
It is important for investors to look ahead and not in the rearview mirror.
Consider continuing to hold existing positions. Based on individual risk preference, on dips, consider holding 🔒 in cash or treasury bills or short-term bond funds or allocated to short-term tactical trades and short to medium-term hedges of 🔒 and short term hedges of 🔒. This is a good way to protect yourself and participate in the upside at the same time.
You can determine your protection bands by adding cash to hedges. The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive. If you do not hedge, total cash level should be more than stated above but significantly less than cash plus hedges.
It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash. When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks. High beta stocks are the ones that move more than the market.
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