Evening Watch List for January 19th

Mish Schneider | January 18, 2016

Monkeys & January Calendar Ranges-7 Trades

How January Can Be A Reliable Indicator
The best part of last week is that we now have a 10-day trading range for January. This means we can use the low set on Friday as THE LOW to trade against. We can use the high set on January 4th as THE HIGH to trade against.

The 10-day Calendar Range of January is a reliable indicator of the trading range to look at for the next 6 months until it resets in July.

Since this year’s range happens to be quite large, that leaves a lot of room in between the high and the low. In the middle, what will become tantamount to trading success, will be both calculating risk/reward ratios and trading in the appropriate timeframes plus picking instruments that are closest to the low or the high to either go long or go short.

Sound easy?

One thing is for certain, with bearish phases, wide trading ranges and massive liquidation already occurring, anything can happen!

Although a bit too early to bring in the Monkey Factor-Chinese New Year officially begins on February 8th, -it is a good time or maybe just a fun time considering the lack of fun in the market, to think about some of those predictions.

Not so fun are predictions of air disasters, flooding in Europe, riots in Britain, and further inflammation in the Middle East, especially where Israel and Iran are concerned.

The good news is that Prince Charles could become king-that’ll distract us for a while and that Traditional Chinese culture believes that the Year of the Monkey is of great economic prosperity in China.

If we combine Chinese New Year Predictions with Calendar Ranges, I found a few compelling ones to watch.

1. Oil and Gas are to remain low. With 53.08 the January low in XLE, the energy ETF, a break could send it down to 48.50 area, the 2010 lows or lower.
2. Apple expected to have electronic breakthroughs-95.26 is the calendar range low. If holds look for a move over 100 to confirm relative strength
3. Metals will do well-demand for copper and iron could improve. FCX made a low of 3.65. It closed up over 2% on Friday. Against that low, can look for a low cost long
4. China will rebound in its economy. FXI gapped lower on Friday. 29.30 the calendar range low should it hold. However, until it gets back over 31.35, doesn’t look like much.
5. Europe will benefit from China’s investments. Watch FXE. Right now, 107.48 last Friday’s high is the Calendar range to break. It is in a recovery phase. Over that level this week and we could see a move to the 200 DMA or higher.
6. Cruises rather than airline travel will do well for Tourism-Royal Caribbean closed right on the 65-week moving average on Friday. If 82.61, the January Calendar Range low holds, you can look for a reversal pattern to buy.
7. The stock market will continue to have violent swings-duh!

S&P 500 (SPY) August low 182.95. January Calendar range low (JCRL) 185.52. A 30 minute close over 189.20 good start Subscribers: Negative Pivots in all

Russell 2000 (IWM) Reversal candle possible with all criteria met except confirm-a good one would be a move over Friday high on a 30 minute break out over R1.

Dow (DIA) 158.23 the JCRL. 157.35 the 200-week moving average.

Nasdaq (QQQ) A move and early 30 minute close over 102.02 should bring in buyers. Overall, the market is broken but a huge rally to short is not out of the question

XLF (Financials) 20.74 the 200 weekly moving average and unless it clears 22, will most likely see it

KRE (Regional Banks) I like this as a place to go for a rally to buy provided you know how to manage your risk/reward

SMH (Semiconductors) 43.82 the 200-week moving average to hold

IYT (Transportation) 120 pivotal

IBB (Biotechnology) Inside day with last Thursday’s low the JCRL to watch hold or not

XRT (Retail) A close under the 200-week moving average. First time since 2009

IYR (Real Estate) 69.77 the 200-week moving average

ITB (US Home Construction) Held the 200-week moving average

GLD (Gold Trust) Unconfirmed phase change to recovery. Needs to hold 103 area

GDX (Gold Miners) Under 13 looks like more downside

XOP (Oil and Gas Exploration) Of the oil group, this closed the best and with a possible reversal pattern

TAN (Guggenheim Solar Energy) If this drops to 20.00, will put it away for the grandkids

TLT (iShares 20+ Year Treasuries) Highest levels since September 2015 and not overbought

UUP (Dollar Bull) Has a gap overhead it hasn’t filled which could be negative, and under the 50 DMA

CORN (Corn) Subscribers: 21.40 takes out the JCR high-worth watching

JO (Coffee) Subscribers: A low volume possible reversal Thursday then an inside day Friday. Like over 18.12 and will look to buy a small position if clears against the lows

PHO (Water) Subscribers: Matched the 2012 low-interesting

NOTE: *All starred picks are from the automated list of picks (which now includes short picks!) denote that it has one or more of the 18 chart patterns we have used on the radar screen. For example, inside day, 2 days under floor trader pivots, phase change, brick wall or return to the 10 DMA, etc.

Longs

AEM
ANF**
BXP**
CHKP**
CRM**
CUBE
DG**
DLR**
DLTR
DTE
EA
EQIX**
FAZ
FCS**
FRAN
FSLR
GGP**
GLD**
HON**
KIM**
NNN**
O**
PM
QIHU
ROST**
SCO
STZ
SWI
TZA
UVXY**

Shorts

ACAD
BIIB
BMRN
CELG
ESRX
GG
HP
JAZZ
MCK
MDVN
RHP
SPLK
STLD
SWKS
UPRO
UTX
VRTX
VRX
WYNN
YELP
YUM

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