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The month of April was a tough one for my family with two funerals in ten days and the associated travel. As I opened the newsletter this morning, I was shocked to see how long it has been since my last issue. I apologize and will do my best to not let this happen again.
The Standard and Poors 500 index (SPX) closed today at 7399, up 62 points for a gain of 0.8%. SPX opened the week at 7228, setting up a weekly gain of 2.4%. Trading volume has only run above average twice this week and once last week.
VIX, the volatility index for the S&P 500 options, opened the week at 17.2% and closed today at 17.4%, essentially flat for the week. Historically, we would not regard these volatility levels as low but given all of the market and global turmoil in just the first four months of this year, 17% seems low by comparison. After all, VIX hit 35% on March 9.
I monitor the movement of high beta stocks by tracking the ETF containing the top 100 S&P 500 stocks ranked by beta, SPHB. SPHB closed today at 141.7.5, up 2.9 points or +2.1%. SPHB opened the week at 135.7, setting up a weekly gain of 4.4%. Trading volume spiked higher on Wednesday, but that was an exception. SPHB’s trading volume has been running below the 50 dma most of the time for the last thirty days.
The NASDAQ Composite index closed today at 26,247, up 441 points or +1.7%. NASDAQ opened the week at 25,112, setting up a weekly gain of 4.5%. Trading volume continues to run at or below the 50 dma.
It is interesting to take a “clinical” look at the charts. We have been in an extremely bullish trend since the end of March, but it doesn’t feel that way. I think the market price volatility, the Iran war and extreme political division, including significant domestic violence, has colored my views. Effectively, I missed a significant bullish run while hiding under the desk. Since March 31, the S&P 500 has gained 16%, the high beta S&P stocks, as measured by SPHB, are up 26% and NASDAQ is up 25%. Wow!
These gains are not that surprising when you look at the basic economic data. The economic outlook is very strong with strong GDP growth and large domestic capital expenditures announced and breaking ground.
If you have any questions or concerns, please contact me. I will be happy to help in any way I can.
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The Standard and Poors 500 index (SPX) closed yesterday at 6369, down 108 points for a loss of 1.7%. SPX opened the week at 6575, setting up a weekly loss of 3.1%. SPX broke down through the 50 dma on 2/12 and broke through the 200 dma on 3/19. Trading volume ran below average all week. SPX is now down 7.4% since 1/2/26.
VIX, the volatility index for the S&P 500 options, opened Friday morning at 27.4% and spiked to close at 31.1%, below its recent high of 35.3% on 3/9.
I monitor the movement of high beta stocks by tracking the ETF containing the top 100 S&P 500 stocks ranked by beta, SPHB. SPHB closed Friday at 113.5, down 2.5 points or 2.1%. SPHB opened the week at 117.8, setting up a weekly loss of 3.7%. The S&P high beta stocks broke the 50 dma on 3/3 and are within three points of breaking down through the 200 dma at 111.3. Trading volume spiked higher on Friday.
The NASDAQ Composite index closed Friday at 20,948, down 460 points or 2.2%. NASDAQ opened the week at 21,996, setting up a weekly loss of 4.7%. NASDAQ was hit hard early in the week, recovered by Thursday and then gapped open lower Friday. NASDAQ’s trading volume continues to run along the 50 dma. The NASDAQ Composite is now down 10.8% since 1/2/26.
The market is clearly in correction with the S&P stocks down over 7% since the beginning of the year. NASDAQ is down even farther, nearly 11%. IBD’s recommendation for market exposure is “0-20%”. At times like this, it makes sense to build a list of solid stocks that are handling the correction well and may be solid buys even now:
Diversified oil and gas: CVX, DVN, MPC, SU, VLO, and XOM.
Oil and gas services: HAL and SLB.
Odds and ends doing well in spite of this market: CASY, JNJ, and ROST.
Consistently profitable trading in my accounts this year has been limited to non-directional trading of the indices. My long-term SPX condors (> 60 dte) are up 19.2% this year and have not booked a loss since the “tariff correction” of April, 2025. My SPX zero dte trades have booked net gains of $17,150 this year with ten contracts in a $50k account.
If you have any questions or concerns, please contact me. I will be happy to help in any way I can.
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The Standard and Poors 500 index (SPX) closed today at 6836, up three points for effectively no gain (0.05%). SPX opened the week at 6917, setting up a weekly loss of 1.2%. SPX broke down through the 50 dma yesterday and tried to recover today but could not make it back to the 50 dma. Trading volume ran slightly above average for the week.
VIX, the volatility index for the S&P 500 options, opened the week at 18.0% and closed today at 20.6%. The intraday high this week occurred this morning at 22.4%. A VIX reading at 20-22% isn’t consistent with the recovery we might be tempted to read into today’s trading action.
I monitor the movement of high beta stocks by tracking the ETF containing the top 100 S&P 500 stocks ranked by beta, SPHB. SPHB closed today at 122.6 for a one percent gain. SPHB opened the week at 122.6, setting up a weekly gain of zero, a flat trading week. Trading volume was above average only on Thursday. SPHB broke its 50 dma early this morning but recovered quickly.
The NASDAQ Composite index closed today at 22,547, down 50 points or -0.2%. NASDAQ opened the week at 22,952, setting up a weekly loss of 1.8%. NASDAQ is a long way from recovering its 50 dma at 23,358. NASDAQ’s trading volume fell below the 50 dma today.
The question for the week: Did the S&P 500 index signal a bottom today?
Key facts:
1) Today’s low around 6800 coincides with lows set on February 5 and January 20.
2) SPX lost 136 points yesterday but only gained 80 points at its high today.
3) SPX weakened this afternoon and closed nearly at Thursday’s close.
4) Today’s low in SPX around 6800 is close to the lows set on 1/20 and 2/5.
My conclusion: We would like to read a “finding support and recovering” from this chart. The observations above don’t support that conclusion. Today’s market action could be the first step of recovery, but I wouldn’t risk my money on that premise.
Don’t be spooked. Follow your rules. Discipline is crucial.
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The Standard and Poors 500 index (SPX) closed today at 6740, down 90 points for a loss of 1.3%. SPX opened the week at 6824, setting up a weekly loss of 1.2%. SPX broke down through the 50 dma last week and today’s slide takes SPX to its low for this year. Trading volume ran along the 50 dma this week.
VIX, the volatility index for the S&P 500 options, spiked to 28% during trading on Tuesday and spiked as high as 30% today before closing at 29.5%.
I monitor the movement of high beta stocks by tracking the ETF containing the top 100 S&P 500 stocks ranked by beta, SPHB. SPHB closed today at 118.3, down 3.6 points or 3%. SPHB opened the week at 120.3, setting up a weekly loss of 1.7%. Trading volume was above average most of the week, peaking yesterday.
The NASDAQ Composite index closed today at 22,388, down 361 points or
1.6%. NASDAQ opened the week at 22,322, setting up a weekly loss of 0.3%. NASDAQ was hit hard early in the week, recovered by Thursday and then gapped open lower today. NASDAQ’s trading volume ran along the 50 dma all week.
The war in Iran has spooked world economies. Yesterday, a retired admiral wrote an article saying that the Strait of Hormuz would be closed by Iranian speed boats. He set off a panic about oil prices that continued into today’s markets. Allow me to apply a little common sense and observe that most of the American Navy is in the Persian Gulf north of the strait of Hormuz and in the Gulf of Oman south of the strait and they have sunk 90% of the Iranian navy. This will be all over shortly.
Successful trading in this market is limited to two areas: 1) Buying quality stocks at bargain prices and 2) day trading the indices. I have been trading the SPX zero dte options all week and booked gains every day for a total of $4,900 with ten contracts in a $50k account.
If you have any questions or concerns, please contact me. I will be happy to help in any way I can.
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The Standard and Poors 500 index (SPX) closed today at 6932, up 134 points for a gain of 2%. SPX opened the week at 6917, setting up a weekly gain of 0.2%. SPX broke down through the 50 dma yesterday but recovered that line very strongly today. Trading volume ran above average for the week.
VIX, the volatility index for the S&P 500 options, spiked up over 23% yesterday, opened this morning at 21.2%, and declined all day to close at 17.8%. Today’s close remains relatively high but the move lower was dramatic.
I monitor the movement of high beta stocks by tracking the ETF containing the top 100 S&P 500 stocks ranked by beta, SPHB. SPHB gapped open this morning and closed at 123.0, up over five points or +4.4%. SPHB opened the week at 123.5, setting up a weekly gain of 0.4%. Trading volume was above average from Wednesday on. SPHB broke its 50 dma yesterday but nearly reached its recent high today.
The NASDAQ Composite index closed today at 23,515, down 15 points or
-0.06%. NASDAQ opened the week at 23,517, setting up a weekly loss of 0.3%. NASDAQ’s trading volume has been quite low since mid-December but finally ran above the 50 dma all week.
The Stock Trader’s Almanac calls the three January indicators for the year the January Trifecta. The Santa Claus rally (the last five trading days in December plus the first two trading days in January), failed this year with a decline of 0.03% on the S&P 500. The first five days of trading in January was positive at +0.6%. A positive first five days of January has an 83% correlation over the past 48 years with a positive market for the year. The January barometer, the entire month's trading results, was saved by today’s huge move (up 0.8% for the month). This leaves us with two of the key technical indicators pointing to a positive year in this year’s market. When all three indicators are positive, the S&P 500 has been for the year up 91% of the time; when only two indicators are positive the success rate of this prediction drops to 61%.
The economic data have been generally solid and growing. But the market has been very volatile. In my opinion, this is principally due to the extreme political uncertainties we face today. The large institutions and hedge funds are easily spooked, as they were this week. But they quickly recover and trade higher. I count 6 cycles on the S&P 500 chart since early October. This market reminds me of my favorite metaphor for the market: We small retail traders are like mice running through a stampede of elephants. Don’t be spooked. Follow your rules. Discipline is crucial.
