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

Markets fell sharply last week. On Monday, things started to slid. Then, stocks traded in a narrow range on Tuesday and Wednesday, mainly between 2070 and 2080 on the SPX. Stocks broke down on Thursday, with SPX closing below 2050. On Friday, the bleeding did not stop and the market closed at the day low with SPX closing barely above 2020.

The selling came quickly on Thursday and Friday. We jumped on puts and offset most of the losses on our long sides plays. PRGO puts was a big winner, gaining a profit of +86% overnight. We got out of GOOG puts too early. SPY puts helped us along the way making profits as high as +51%. Here are the closed trades for the week:

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For the week, the Dow was down 665.09 points; SPX fell 76.16 points; Nasdaq tumbled 219.24 points. Gold slid down to around $1080/ounce, while oil (WTI) dropped to below $41/barrel. Here are where the US markets closed on Friday.


On Friday, SPX fell 22.93 points to close at 2023.04. It closed below its daily MAs. The MACD curved down.


Nasdaq tumbled 77.2 points to close at 4927.88. It also closed below its daily MAs.

Stocks came down hard on Thursday and Friday. Nasdaq is closing the gap made, on 10/23, by a big jump from the day after GOOG, AMZN, and MSFT earnings. Things sold off in a hurry on Friday perhaps partially because of the terrorist attacks in Paris. For the new week, things are likely to be volatile. Selling momentum should start to decrease by mid-week and things should consolidate. By Wednesday afternoon, people should be paying attention to CRM earnings.

SPX has support at 2000.

On thing to note is that the biotechs were actually higher on Friday, as a sector. But, most other major sectors sold off. Oil was very weak last week, and energy stocks took a beating. One thing to look for next week is solar stocks. I think they are oversold. We will get earnings from JASO and JKS. But, if the sector bounces, I'd favor FSLR and SPWR.

Sector Watch

FAS (financials)

FAS took a sharp fall with the broader market. The big banks held up reasonable well; but, it could mean that they have more to fall. V seems to be ready to come down.

BTK (biotech)

The attack on pharmaceutical companies continued. VRX got driven down to $75! GILD, AMGN, BIIB, and CELG were all weak. But, VRTX, ILMN, and INCY were quite strong. MYL also jumped at the expense of PRGO. I think biotechs made need to consolidate further as a sector. We will have to pick stocks to play here. There are potentials on both sides.

XLE (energy)

XLE came down quite far last week. EOG, SLB, XOM were very weak. I'm looking for CVX, TSO, and VLO to come down more.

*** I will be traveling next week and will be trading with you from Asia! There will be times when I'm not around. So, I will be making slow and fewer trades.

Good night and HappyTrading! ™

Posted to Ecstatic Plays on Nov 13, 2015 — 11:11 PM
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