S&P 500 Volatility Index ($VIX) Settles at Bearish Reading

The S&P 500 Volatility Index ($VIX) tested a low of 12.55 with last Friday and key support at 12.50 holding on the market’s opening gains. The surge to 15.27 afterwards breached lower resistance at 15-15.50 and the 200-day moving average but levels that held into the closing bell. There is upside risk towards 17-17.50 on a move above the 15.50 level.

Fresh and rising support is now at 14.50-14 and the 50-day moving average. Continued closes back below 13.50 are now needed to reestablish a possible  bullish signal again for the market.

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Amicus Therapeutics (FOLD) Worth a Look

Amicus Therapeutics (FOLD, $10.48, down $0.06)

FOLD January 10 calls (FOLD200117C00010000, $1.15, flat)

Entry Price: $0.70 (11/20/2019)

Exit Target: $1.40

Return: 64%

Stop Target: 95 cents (Stop Limit)

Action: Upper support at $10.50-$10.25 held on the pullback to $10.40. Resistance is at $10.75-$11.

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Bulls Wrap up Solid Month Despite Black Friday Pullback

NextOptions.com Index and Earnings Options Play List for 12/2/2019

Bulls Wrap up Solid Month Despite Black Friday Pullback

8:00am (EST)

The market traded lower throughout Friday’s shortened session despite indications of a strong kick-off to the critical holiday selling season for the retail sector. Worries over president Trump’s signing of the Hong Kong Human Rights and Democracy Act of 2019 led to the overall weakness and could be a sticking point to locking up a phase one trade deal.

China responded by saying trade negotiations are still on track as long as the President doesn’t implement any of the law’s measures. The limited action and slight pullback snapped 4-session winning streaks but wrapped up a solid month of November as the major indexes had their best showing since June.

The Russell 2000 fell 0.6% following the intraday backtest to 1,624. Current and upper support at 1,625-1,610 was breached and failed to hold by a half-point with risk towards 1,600-1,585 on a move below the latter.

The Nasdaq gave back 0.5% after trading to a late day low of 8,664. Current and upper support at 8,650-8,600 held with a move below the former signaling risk towards 8,550-8,500.

The S&P 500 was lower by 0.4% with the low reaching 3,139 ahead of the closing bell. Near-term and upper support at 3,125-3,100 easily held with a move below the latter opening up risk towards 3,075-3,050.

The Dow was also down 0.4% following the pullback to 28,042. Near-term and upper support at 28,000-27,800 held with a close below the former getting 27,600-27,400 in focus.

For the week, the Russell 2000 gained 2.3% and Nasdaq jumped 1.7%. The S&P 500 rose 1% and the Dow was up 0.6%. For November, the Nasdaq zoomed 4.5% and the Russell 2000 soared 3.8%. The Dow surged 3.7% and the S&P rallied 3.4%.

Energy was the weakest sector on Friday after falling 1% while Consumer Discretionary was down 0.7%. There was no sector strength.

For the week, the best performing sectors were Consumer Discretionary (2.6%), Healthcare (2.2%) and Communication Services (1.7%). Energy (-1.6%) and Utilities (-0.8%) were the only sector laggards.

TWTR Calls Up 81%

Twitter (TWTR, $30.91, down $0.26)

TWTR January 30 calls (TWTR200117C00030000, $1.90, down $0.20)

Entry Price: $1.05 (11/15/2019)

Exit Target: $2.10

Return: 81%

Stop Target: $1.80 (Stop Limit)

Action: Upper support at $30.75-$30.50 held on Friday’s fade to $30.78. Resistance is at $31-$31.25.

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TLT Holds 50-Day MA

The iShares 20+ Year Treasury Bond ETF (TLT) was down for the 2nd-straight session after tapping a low of $139.78. Near-term and upper support at $140.50-$140 was breached and failed to hold. A close below the former and the 50-day moving average would be an ongoing bearish signal with downside risk towards $138.50-$138.

Current resistance from late October remains $141-$141.50.

RSI is in a downtrend with support at 55-50. A move below the latter would signal additional weakness towards 45-40. Resistance is at 60 and the November peak.

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QQQ’s Could Be Peaking…

The Invesco QQQ Trust (QQQ) had its 4-session winning streak snapped following the pullback to $205. Current and upper support at $205-$204.50 was triggered but held. A close below the latter would signal a possible near-term top with backtest potential towards $202.50-$202.

Resistance is at $205.50-$206. Continued closes above the latter and last Wednesday’s all-time high of $206.05 would be an ongoing bullish signal with upside potential towards $207-$207.50.

RSI has turned south on the close below upper support at 70-65. A close below the latter and the November low opens weakness towards the 60 level and late October support. Resistance is at 75.

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