I know what you're wondering-will it last? I know what you're hoping-make it last! I know what you're fearing-it cannot last! I know what you did last summer-no I don't but threw that in to see if you're paying attention (and in homage to Lionsgates (LGF) new release "A Cabin in the Woods." Friday the 13th after all.
See notes on individual indexes and sectors below.
S&P 500 (SPY) Declining fast moving average closing in. 139.40 resistance. More likely to see another inside day and no bad news unless it breaks the 50 DMA at 137.64.
Russell 2000 (IWM) A nice surprise would be a gap higher leaving a possible island bottom in place as the week ends. More likely is an inside day to end the week leaving this index still vulnerable heading into Monday.
Dow (DIA) Cleared the 50 DMA barely after an awesome run.
NASDAQ 100 (QQQ) A bear flag in a bull trend could be developing-watch this one for signs of weakness unless pulls away from the fast moving average.
ETFS:
GLD A perfect trade following the breakout of the inside day. 165 the top of recent range
XLF (Financials) Filled gap, great trade, now at resistance. Would welcome digestion in today's range
IBB (Biotechnology) Like NASDAQ, could be a bear flag forming and under the 50 DMA to boot-cautious here
SMH (Semiconductors) Impressive as the one who touched, ran through and closed just shy of the fast moving average. 34.70 now pivotal
XRT (Retail) Cleared the 50 DMA handily. Also running into fast moving average resistance
IYT (Transportation) Note to self-never underestimate an inside DOJI day again!
IYR (Real Estate) Cleared the 50 DMA under the 10 DMA
OIH (Oil Services) Most hammered coming into the day and biggest percentage gainer. From December until now, the daily chart looks like a mountain in the Sangre de Cristos.
XLE (Energy) All eyes on the 200 DMA.
TBT (Ultrashort Lehman 20+ Year Treasuries) This chart looks like a dragon. Still watching the 50 DMA.
Longs: On categories: Gap higher days we go to all categories and choose ones with lowest risk that break the opening range. On weaker days, we look at Category 3, especially if the picks hold S1, previous day lows or a major moving average and have a good risk on the reversal. The difference between Category 1 and 2 is the stock condition-a Condition 1 is strongest stock and more likely to make a parabolic move.
Note: After a day like today, to narrow down focus, looking at mainly stocks that improved to a Condition 1 or 2 and not overbought on any RSI. Also because its Friday, prefer to watch how the indexes and ETFs do. Most importantly, is that today so many stocks that had inside days yesterday, were great buys.
Category 1: (Aloha) Positive Phase, Condition 1, 2 days under the FTPs, Risk to Previous Day low, Can buy ½ over FTP and ½ over R1, Target- Day to at least 3 ATRs from entry:
N/A
Category 2: (Pipeline) Positive Phase, Condition 2-3, 2 days under the FTPs, Risk to Previous day low, Can buy ½ over FTP and ½ over R1, Target- Day to at least 3 ATRs from entry:
AAPL Now a condition 2 with 3 days under the FTP. Still a possible slingshot from the highs, but this is AAPL. Risk to today's low and back over 624.75, the FTP worth a shot in line with the opening range.
ALXN 2 inside days and 2 doji days which means will not stay at these prices much longer. Condition 4 can go either way. Pivots positive but has closed under them for 4 days. Must hold 89.44 and clear today's high
FOSL 3 days under the pivots. Must hold 132.24 and clear 113.48 then R1 and today' high
Category 3: (Double Up) Positive Phase, Condition 1 through 4, Positive Pivots which means candidate for Opening Range Reversal, Risk S1 or previous day low, whichever is lower unless noted differently, Target- Day to at least 3 ATRs from entry:
CF Prefer OR reversal against 187.22
BG 68.00 good risk
SPG 145.10 should hold the 10 DMA.
TPX 84.35 the 10 DMA should hold
CRM Narrow range and inside day. Should hold today's low. Strong chart
HLF Condition 4 Nearly another Inside day, now with positive pivots, must hold 67.94 and clear 69.05 with the 10 DMA the more critical point to keep you long
MNST Like to see 62.00 hold.
REGN Like to see 120.40 hold. DOJI day
WFM Reversal preferable against 85.05
Category 4: (Rip Tide) Oversold (2 or more days under FTP), Condition 1-4, Needs to clear R1, Risk previous day low unless noted differently, Target- Day to at least 3 ATRs from entry:
N/A
Slingshot-New 60-day low, close on highs:
APA CVX
COST Over 87.60 and hold today's low
Shorts: Picks underperformed so worth watching
LEA Must break S1
SHLD Must break S1
GMCR Positive pivots but underperformed. Has to break S1 and today's low and not clear today's high
DECK Broke R2 and then S2-wild action, but still negative overall.
TIF Positive pivots but underperformed. Has to break today's low and not clear today's high
Goodnight!