I would like to personally thank the gods of trading for reading my plea of releasing the pause button. This was the best volume we have seen since August 7th, but not nearly enough to start predicting a 'blow off" rally. Volume could not make it to its daily average. Most likely scenario-a new round of digestion as August enters final 2 weeks, then another run. S&P 500 (SPY) 142.21 is 2012 high. Today's high 142.16. But everything worked. The inside day, patience during consolidation, discipline, trading plan and trust in the phase.
Russell 2000 (IWM) Broke 80.40-50 for next leg up. 81.84 July high and real far from 2012 high. That means, that if anything should roll over, look here first. That would likely look like a break of 80.00.
Dow (DIA) 133.14 the 2012 high.
NASDAQ 100 (QQQ) 68.55 the 2012 high. If long, would be looking at what happens up here to see if can clear or not. Not saying it's the top, but with overbought RSIs, trimming on big profits not such a bad idea ahead of a weekend.
ETFs:
GLD Will this have what it takes to get through 158?
XLF (Financials) Kind of an anemic run past 15.06. Although I like the basing action all year, only ½ way to the 2012 highs. Keep eyes here
IBB (Biotechnology) Maybe this sector needs a serious rest after leading the charge all year.
SMH (Semiconductors) Matched the closing price from 08/10. Over 33.90 will look for the 2012 high
XRT (Retail) Like to see 60.86 hold now.
IYT (Transportation) Confirmed phase change to bullish. Now, can buy dips more safely
IYR (Real Estate) Similar to biotech-led the charge, now dragging along for the ride, which means could be vulnerable on any correction
USO (US Oil Fund) Getting closer to my target of 36.50 level
OIH (Oil Services) Been positive on this group since mid-July when the phase went to recovery
XLE (Energy) If good, has more clearance to go above the recent consolidation.
TBT (Ultrashort Lehman 20+ Year Treasuries) Big volume could mean this ran up too fast too enthusiastically. Subs: Took off ½ my calls today for double the money profit.
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: Anything that is on this list is a candidate for a swing trade-(of course market condition is a factor) -use the max risk mentioned along with an opening range stop using fudge factor and time confirms. I suggest you decide on 1 or 2 that have a risk you like and then position size accordingly.
Note: Most of the recent picks in play. Tonight will add a couple of new ones or any old ones that did not set up yet. Anything you are already in or unclear about, please ask.
Category 3: (Double Up) Positive Phase, Condition 1 through 4, Positive Pivots which means can either buy a opening range breakout orcandidate for Opening Range Reversal, with Risk S1 or previous day low, whichever is lower unless noted differently, Target- Day to at least 3 ATRs from entry:
BA Improved to condition 2. 72.95 max risk, 73.80 the 10 DMA like to see clear
COF improved to condition 1. 56.00 should hold to continue up
ASML Like to see 57.90 clear and hold 57.10
DLR Improved to condition 3. 75.44 max risk.
EQT Improved to condition 1. Now, 55.55 good risk.
EWW 62.75 level to hold and 63.31 next place to clear
TSCO Improved to condition 1. Watch for OR reversal preferred
MOS Prefer a reversal but did clear to new highs. 59.00 good risk point
WWW Improved to a condition 1. 44.35 max risk
PPG Improved to condition 1. Today's low max risk.
Category 4: (Rip Tide) Oversold (2 or more days under FTP), Condition 4, Needs to clear R1, Risk previous day low unless noted differently, Target- Day to at least 3 ATRs from entry:
Phase Change: BBL Outperformed market, in accumulation phase. 61.40 max risk. Over 62.66 clears recent highs CRZO Unconfirmed accumulation phase. Should hold 25.50 and needs second close above the 200 DMAMSI Unconfirmed accumulation phase. Should hold 47.90 and needs second close above the 200 DMA WSM Unconfirmed accumulation phase. Should hold 36.65 and needs second close above the 200 DMA LNKD Changed to bullish phase. Has to hold around 103 for cleanest risk CERNInside day after accumulation phase change. Over todays' high with good risk to today's low
Shorts:
Category 5:Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
FB Should not clear 20.50 and could see lower prices-day to mini
OXY Inside day. Slightly positive pivots but way underperformed. Max risk 89.61
Bye for now!
