The DIA was the only one who held onto the inside day on Friday. The rest (NASDAQ, S&P 500 and Russell 2000) closed nastily setting up this coming week as a make or break one. We saw the toppy formations, the oversold condition and ensuing bounce, and finally, the bear flag in QQQ led by the decline in AAPL (now oversold) and GOOG. Considering the slope of the 50 DMA is still positive in the S&P 500, we won't totally discount a rally, but gun to the head, looks like we're in for nasty weather.
S&P 500 (SPY) Back to an unconfirmed weak warning phase. 135.76 was last week's low. I do not like when I see a gap lower like the one we had last Monday, and even with a bounce, cannot fill that gap.
Russell 2000 (IWM) Could not quite make the inside day to end the week, thereby leaving this index still vulnerable heading into Monday. 77.95 last week's low. Over 81.00 would be a shock but. anything is possible.
Dow (DIA) Inside day which means a good one to follow the way the range breaks down or up.
NASDAQ 100 (QQQ) Even with the bear flag, the phase is still bullish let's not forget. 65.92 last week low which if breaks, not a good sign. But if holds, besides DIA, another reason to not sell the farm just yet.
GLD Held the fast moving average but does look like the daily moving averages are headed to a death cross. 155 has been the bottom of the recent trading range.
XLF (Financials) 15.12 is the 50 DMA ending the week and it did indeed hold with a positive slope. So again, anything is possible-a failure back to looking at 14.50 or a hold, move over Friday's high and another run.
IBB (Biotechnology) 117.85-118.00 an area of support. A break of that area and we got some more correcting to do.
SMH (Semiconductors) Also an inside day and although it failed at the 50 DMA it closed pretty far from the low tick last week, therefore, could be another key to what happens from here.
XRT (Retail) Inside day and right on the upward sloping 50 DMA. Really, retail is a huge key to next direction.
IYT (Transportation) Inside day under the 50 DMA after the huge run
IYR (Real Estate) Bumping up against the 50 DMA and another one that ended the week with an inside day.
OIH (Oil Services) Still long term trend negative. Ended with an inside day
XLE (Energy) Oversold weekly RSI, inside day and under the 200 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.
Subs: Bottom line-The Retail, Financial, Real Estate and Transportation sectors are key to whether or not the "recovery" is real or cooked. Before we commit long or short in size or for more than a day to miniswing trade, watch how these ETFs relative to the inside day and 30 minute opening ranges behave. Make sure you check earnings
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:
WPI Negative pivots for only 1 day-but if can clear 67.60 could see another leg up
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:
FOSL 4 days under the pivots. Close to oversold and still a good one to look at for possible bounce through the pivots
CHKP Condition 4, outperformed the market but needs to clear 63 and hold 62
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: (There are more picks in this category since these are the strongest stocks)
CF If 185.12 can hold, overall chart continues to look promising
CRM Would only consider a reversal with risk to Friday's low
UA Like to see 95.15 hold
TWC Definitely want to see Friday low hold.
TDC Like to see Friday low hold and prefer a reversal
HLF Closed well and now through the 10 DMA and Friday high could see 71.50 or higher
SPG Want to see Friday low hold
EL Prefer a reversal against 62.60 area
EQIX Inside and narrow range day. Over 156.50 could see recent highs and higher
REGN Slightly negative pivots. Must hold 121.20 and clear Friday high. Then could see new highs
WFM The miniswing/swing trade from last week still in play. Like to see Friday low hold
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:
AAPL Now a condition 2 with 4 days under the FTP. The RSI is oversold on the daily. The FTP at 611.13 is an area to watch.
Shorts: Negative pivots and none should clear Friday high. Keep eyes on indexes and the ultrashorts
ANF CNX BTU DECK TIF POT (42.16 last swing low to break)
NFLX has positive pivots but 1st time closing under the 200 weekly MA since January. Must break Friday low. 90.00 possible if does not clear Friday high
X Inside day cannot clear Friday high. 28.50 the negatively stacked pivot is good area to see if fails or holds
Have a Great Sunday!