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Issue #945 
Jan 11, 2026 | Newsletter
The newsletter with chart analysis for stocks and stock indexes |
Stock Indexes Analysis/Evaluation
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| Bulls presently in control but obstacles are ahead!
DOW Friday Closing Price - 49504 New all-time highs were made in all the indexes, with the exception of the NASDAQ (which still finds itself 1.6% from its all-time high at 26183). All indexes closed on the high of the week, suggesting further upside above last week's highs will be seen this week. In the DOW that is above 49621, in the SPX that is above 6975, in the NASDAQ that is above 25813, and in the RUT that is above 2635. The economic reports that came out this week were not bullish, given that the manufacturing index (ISM) report showed a drop from 48.2% to 47.9% and the Jobs report showed a weaker than expected jobs market (50k vs expected 70k). This does suggest a slightly weaker economy. Nonetheless, neither report was overly negative and given that it fuels the idea that not only will the Fed cut interest rates on the 28th of this month, but it is now a higher possibility that it will be 50 points, rather than the 25 points expected. That is likely what fueled the making of the new highs. Having said that, the DOW and the SPX are now both near a major psychological high at 50,000 and at 7000 that will likely require good and positive fundamental news (and not just the cutting of interest rates) for those levels to be broken. This week and on Tuesday, the inflation (CPI) report comes out. The number is expected to be .3% with last month being .2%. If it is higher, it will be a negative, but if lower it will give added ammunition to the bulls. The Home Sales number also comes out on Tuesday and it too has some potential impact. The expectations are for it to come out at 710k (last month it was 800k). On Wednesday, Retail Sales comes out and expectations are for it to be .4%, with last month being .0%. Those are the reports for this week. Only if they are way out of line will that make a big difference. The psychological effect of these 2 levels in the DOW and SPX is strong and as such, the probabilities do favor them not being broken in a decisive way. What this likely suggests is that the indexes will get up to those levels and then slightly back off at first. It will then go back up to test those levels again (as the Fed rate decision date nears) and then based on the decision (and reaction to it), will the traders make any further decisions of any consequence. This means that for the next 2 weeks, this market will not be heading greatly or indicatively in any direction. Having said all of the above, let me give you the levels to watch, should there be any surprises in either direction. In the DOW, any rally above 50,030 will give an additional edge to the bulls and a break above the 50,300 level would be a statement. To the downside, any confirmed daily close below 48,704 would give the bears new ammunition. In the SPX, those same levels to the upside are 7030 and 7300, and to the downside, it is the 6830 level. The NASDAQ is another story (as far as the charts are concerned), given that it still has existing and established resistance levels above that the bulls need to break to even begin generating new buying interest. The index did break one (of 4) of the intraweek resistance levels this past week, with that level being the 25716 level. That leaves resistance at 25877, at 26132 and at 26182. Nonetheless and on the weekly closing chart, the index did break on Friday, 2 of the 3 resistance levels, leaving at 25858 level as the only resistance level left. That level is highly likely to be in play this week, given that the index closed on Friday just 92 points below that all-time weekly closing high. To the downside, the bears will need to generate a confirmed daily close below 25206 to generate any new selling interest. HSI index generated a negative reversal week and closed in the lower half of the week's trading range, suggesting further downside below last week's low at 25959 will be seen this week. If that does occur, last week's intraweek high at 26883 will become the 2nd retest of the trend/rally high at 27381 what was made last June. This would not be a clear sign of anything other than to increase the probabilities of the 3-point support level between 25087 and 25178 getting broken at some point over the next few weeks. For this coming week though, it is not indicative of anything of consequence occurring. Levels to watch for this "coming week" (on a daily closing basis) are 25908 and 26485. Neither are pivotal for the longer term but a break of either will give some short-term ammunition to the bears or bulls (depending on which of the two gets broken). The index closed on Friday at 25231.
GOLD(Feb 2026 chart) generated an uneventful inside week but did close green and near the high of the week, suggesting further upside above last week's high at $4526 will be seen this week. The all-time intraweek high is at $4557 ($4527 on both a daily and weekly closing basis. A break above the former or a confirmed close above the latter would give further ammunition to the bulls. A daily close $4460 would suggest a drop down to $4360 would be seen. Gold closed on Friday at $4500. OIL generated a positive reversal week, having gone below the previous week's low and then closing green and above the previous week's high. Oil closed near the high of the week, suggesting further upside above last week's high at 59.78 is expected to be seen this week. The weekly close on Friday was at 59.12 and that means that a failure signal was given as it closed above 3 previous low weekly closes at 57.54, at 58.09 and at 58.29. This does suggest that at least for the next couple of weeks, the downtrend is paused and some recovery is to occur. The key intraweek resistance is at 62.59. A break above that level will give further ammunition to the bulls to generate even further recovery. To the downside, the 54.98 level remains pivotal support. For the next couple of weeks, Oil will likely trade between $57 and the $62 levels.
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Stock Analysis/Evaluation
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MENTIONS For this week
There is nothing I could find that could be traded. The trading ranges this week are likely to be small unless there is a surprise with the inflation number (unlikely), and even then, such a number cannot be anticipated. This market right now, and especially with the current situation, is not a sale but also not a purchase given the psychological resistance strength of the DOW and SPX indexes.
By the way, I did give a mention last week on a stock with the symbol GCI to purchase between 4.30 and 4.40. It seems that I did not realize that the stock changed its symbol to TDAY on November 18th and the chart evaluation that I made was from 8 weeks ago. Interesting to note that TDAY did get down to 4.36 that week and did make a new rally high this past week, meaning the evaluation was correct but the trade could not be done last week, given that 7 weeks had gone by and the stock traded last week between 5.16 and 6.18. I do apologize for the mistake.
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Updates
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| Monthly & Yearly Portfolio Results
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Closed Trades, Open Positions and Stop Loss Changes
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Status of account for 2007: Profit of $9,758 per 100 shares after losses and commissions were subtracted. Status of account for 2025, as of 12/1 Profit of $15,802 using 100 shares per mention Closed out profitable trades for December per 100 shares per mention
AAPL (short) $1786 MMM (short) $5 Closed positions with increase in equity above last months close. NONE Total Profit for December, per 100 shares. $1,791 Closed out losing trades for December per 100 shares of each mention.
NONE
Closed positions with decrease in equity below last months close. NONE Total Loss for December, per 100 shares $0 Open positions in profit per 100 shares per mention as of 12/1
NONE
Open positions with increase in equity above last months close.
VWDRY (long) $296 Total $296 Open positions in loss per 100 shares per mention as of 12/1
NONE
Open positions with decrease in equity below last months close.
GSTRF (long) $6 Total $2,772 Status of trades for month of December per 100 shares on each mention after losses subtracted.
Loss of $1,277
Status of account/portfolio for 2025, as of 12/31Profit of $14,525 per 100 shares.
Yearly totals:
Total amount of months showing profit = 5
GSTRF generated a negative reversal week, having made a new 8-week intraweek high and then closing red and near the low of the week, suggesting further downside below last week's low at .215 will be seen this week. Once again the .20 cent level of strong and pivotal support is likely to be tested again. Having said that, it is unlikely that anything of any consequence in either direction will be seen. Intraweek levels to watch are .183 and .36.2. A break above or below either level will be short-term indicative.
LXRX generated a relatively uneventful week but did generate a green weekly close, meaning that the recent selling interest is "running out of steam". The stock did close in the lower half of the week's trading range, suggesting further downside below last week's low at 1.12 will be seen this week. Intraweek support is found at 1.07. A daily close above 1.35 will take some ammunition away from the bears and a daily close above 1.42 would give the edge back to the bulls. The bears presently have the edge.
NB generated a new 5-week intraweek high but then closed near the low of the week, suggesting further downside below last week's low at 6.00 will be seen this week. The bulls had a chance to make a small short-term positive statement, given that a weekly close above 6.51 would have done that. The stock did trade as high as 6.69 on Friday but then closed at 6.30, meaning the bulls failed. The previous week's low at 5.14 was a new 6-week low, meaning that a drop below 6.00 this week will likely be a required/needed retest of that low. There is some support at 5.68 that is likely to hold up. Like all other held stocks and indexes, nothing of consequence is likely to happen at this time. An intraweek break above 7.09 or below 5.03 would be indicative.
This past week, WVE generated a new 4-week intraweek high and then closed below the previous week's low, and on the low of the week, suggesting further downside below last week's low at 13.75 will be seen this week. On a weekly closing basis, there is support at 13.67 and with the stock closing on Friday at 13.84, that support has held up. On a daily closing basis, that same support is at 12.85 (intraweek at 12.66), which is highly likely to be seen this week. Having said all of the above, the stock did get some very positive strong fundamental news 5-weeks ago, which in turn generated a breakaway gap between 7.71 and 12.72. As such, this whole move down is likely to be simply a retest of that breakout. The stock has shown quite a bit of volatility and large trading ranges, meaning that last week's trading range of $5.74 cents could be replicated to the upside, if and when the breakaway gap to the upside holds up. Given that there has been no negative news, the probabilities do favor the bulls. The 16.45 level on both the daily and weekly closing charts is now short-term pivotal resistance. A close above that level will negate the recent weakness. A daily close below 12.85 would give the bears new ammunition. Probabilities favor the bulls.
ZLAB generated a new 4-week intraweek high, as well as generated a buy signal on the weekly closing chart, having closed above the most recent high-weekly close at 18.39 (closed at 18.55). The stock closed in the middle of the week's trading range, suggesting equal chances of going above last week's high at 19.32 or below last week's low at 17.82. The stock also generated a buy signal on the daily closing chart on Wednesday by closing above the previous high daily close at 18.58 but that signal was not confirmed as it closed at 18.50 on Thursday and at 18.55 on Friday. By the same token, neither of those closes was by enough margin to say with certainty that the buy signal has been negated. As such, the stock finds itself with the bulls having a very slight edge but given the weakness seen over the previous 2 months, this buy signal does likely give the bulls a slight edge. A daily close above 20.41 would be a statement that the downtrend has found a bottom. A daily close below 17.00 would do the opposite.
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1) ZLAB - Averaged long at 65.50 (7 mentions). No stop loss at present. Stock closed on Friday at 18.55. 2) VWDRY - Sold at 9.71. Averaged long at 8.68, Profit on the trade $412 -er 100 shares (4 mentions). 3) LXRX - Averaged long at 1.513 (7 mentions). No stop loss at present. Stock closed on Friday at 1.17. 4) BCTX - Averaged long at 78.25 (2 mentions). Stock closed on Friday at 7.25. 5) GSTRF - Purchased at .42. No stop loss at present. Stock closed on Friday at .245. 6) NB - Purchased at 6.88. No stop loss at present. Stock closed on Friday at 6.30.
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The opinions and commentaries by Mr. De Vito are not a recommendation to buy or sell, but rather
a charting guideline, based on his own knowledge and experience, regarding the stocks he is following or
that are brought to him by others. Mr. De Vito does not presently offer a track record of his trading experiences.
No inference of success and/or failure should be assumed. The
information enclosed above, regarding his background, length of trading, and experience, is correct
but is not meant to suggest, state, or infer any future success in trading, based on his opinions. The information herewith included should only be used by investors who are aware of the risk inherent in securities trading. Mr. De Vito accepts no liability whatsoever for any loss arising from any use of the information and/or comments he supplies. |
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