With all indexes in weak warning phases (exception is Russell 2000 which is in a strong warning phase), unless market bounces back above the 50 DMA, perhaps the recent rally and subsequent failure sealed the fate for a top in place and more downside to come. Subs: Detailed analysis in today's midday video
S&P 500 (SPY) Through R1 137.63 the 50 DMA is more reasonable a target.
Russell 2000 (IWM)R1 lines up with today's high which could give this a bounce, otherwise, watch the 160 EMA
Dow (DIA) R1 lines up with today's high which could give this a bounce, otherwise, watch the 70 EMA
NASDAQ 100 (QQQ) R1 lines up with today's high which could give this a bounce, otherwise, watch the 160 EMA
GLD With negative pivots, look for an Opening Range high failure to short
XLF (Financials) 15.00 swing area. Longer it holds the better the chances for the market. A failure and see a test of the weekly moving averages below
IBB (Biotechnology) Once the VRTX news runs its course, possible this has seen the highs for now. Only way to alter than bias is if the recent highs are taken out
SMH (Semiconductors) Looks ominous with next major support at 32.00. Only interesting aspect to note is the hammer candle formed today
XRT (Retail)Another hammer candle after the double top at 63.04.
IYT (Transportation) Could have run its course
IYR (Real Estate) One bright spot in the market as long as 63.00 holds. But can this group hold up the market?
USO (US Oil Fund) Would look to buy over R1 and the 200 DMA after the possible slingshot pattern today
XLE (Energy) After the run up to and failure from the 50 DMA, not a real interesting looking chart right now
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: SLG yielded more than 3 ATRs after the long entry the day we left for vacation. Would love to hear who traded that one!
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:
AMZN After gap post earnings, above R1 with risk to 220.22 the gap low for swing 224.80 the FTP for mini
AXP Clear risk to today's low and would like to see it close over R1
FDO Like to see today's low old and clear R1
LULU Must hold today's low then the 10 DMA
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:
BBBY Swing risk the 50 DMA mini today's low and must clear today's high
SLG Should hold today's low and clear the high to return to a condition 1
CTXS Should hold today's low, take out R1 and the 10 DMA to return to conditon1
FFIV Narrow range day, today's low max risk and want to see it clear the 10 DMA
HOG Has to clear R1 51.93 and hold today's low
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:
COF Must hold 53.68 the 50 DMA
CREE Has the 80 monthly overhead and should hold 32.50
PNC Has to hold Friday low and clear the 10 DMA
GS Possible slingshot not a condition stock and has to hold the 200 DMA and clear Friday's high
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:
IBM Has to clear today's high and hold the 50 DMA
Shorts: Nothing with an RSI under 15.00 to narrow list (watch GLD too)
BTU Although outperformed market, has negative pivots cannot clear 30.08
DECK After gap lower post earnings, unless clears 54.77, positive pivots so must break today's low
MOS Inside day must not clear today's high and ideally break today's low
Goodnight!
