Good Morning Today is December 17

• S&P 500 futures are pointing to a lower opening of 5 points as of 8:00 AM
• The US 10-year rate is at 2.88%
• Dollar Index is at 97.21
• WTI Crude Oil is $51.61
• Critical events for today: –Malaysia files criminal charges against Goldman Sachs in 1MDB probe, NAHB Housing Market Index Est. 61

Recap of International Trading:

• Japan was  +0.62%
• Hong Kong Hang Seng Index -0.03%
• China Shanghai Comp. +0.16%
• UK FTSE -0.35%
• Dax -0.33

FED Rate Hike Watch:

According to the CME, there is now a 78% chance of a rate hike in December, that is up from 76% Friday.

Currently, the market is pricing in a 37% chance there is no rate hike in 2019 and a 37% chance of just one rate hike.

Quiet Start to Week

Relatively speaking it is a quiet start to the week with the future pointing to a flattish opening. There is an unfilled gap that was created by Friday’s steep sell-off, and a flattish opening may give the stock market and the ALGO’s a chance to start working to refill that gap. It is worth noting that the S&P 500 did not fall below the December 10 low of 2,583.  All of this would suggest we could see the S&P 500 work its way higher back to 2,650.

Semiconductor (SMH)

The Semiconductor ETF will be a key to watch, and the group has stabilized in recent weeks. The SMH has diverged from the broader index, which I continue to think is a good thing.

Russell 2000 (IWM)

I worry about the Russell 2000 because I think that still needs to fall a bit further, perhaps to 1,394. I would grow even more constructive should the Russell 2000 bounce off that support level and Semiconductors continue to stabilize.

Goldman Sachs (GS)

Goldman Sachs will likely weigh today off the fresh headlines noted above. The stock is now trading right around technical support at $171. Should it fall through that support level it is likely on its way $158.65. 

Apple (AAPL)

Apple will continue to be a focus stock as well, as support need to hold around $164. It is the line in the sand and is an important support level.

Facebook (FB)

As we have noted previously Facebook continues to show positive momentum. $148 continues to be resistance, but a rise above that price may send the stock on towards $158.

Johnson & Johnson (JNJ)

Johnson & Johnson fell sharply on Friday on the Reuters report on Talc Powder. It was a big reason the stock market was down so sharply. The stock may see a rebound today, but resistance sits at $136.75.

Healthcare (XLV)

The healthcare names may come under pressure today as well after a Judge ruled Obamacare unconstitutional now that the penalty has been removed. The XLV ETF closed at support around $89 after JNJ fell sharply. This news late Friday is likely to weigh further on the group, and should it fall support comes around $86.37.

Good Luck

-Mike

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December 17, apple, facebook, goldman sachs, jnj, semiconductors, algo, algo’s