Still low volume, however, a bit better than Monday's in all indexes which means an accumulation day all around. Not much else to add other than that price counts too, especially when in line with the phase.
S&P 500 (SPY) Possible shooting star candlestick formation last 2 days. along with weekly RSIs overbought just as the price has come incredibly close to the 2012 high. Would expect some selling under 140 and perhaps another test of 138.49, Friday gap low. Subs: Shooting Stars imply that the market tested to find where resistance was located and the bears came in to push prices lower, thus the bullish advance upwards was rejected by the bears. Like all potential signals, they should be regarded, but need confirmation.
Russell 2000 (IWM) Cleared but could not close above 80.00. However, if 79.00 holds, then could see a stronger return above 80.00 next time
Dow (DIA) Possible shooting star candlestick formation last 2 days here as well. That means under 131.15, should begin to bring in sellers.
NASDAQ 100 (QQQ) Overbought now which also supports a reason for a correction or better yet, digestion.Subs: Today's low lines up with S1
ETFs:
GLD Inside day. Subs: Positive pivots which means will look for today's low to hold and either a reversal or breakout to enter.
XLF (Financials) Also has those shooting stars on the daily chart. 14.85 has to hold with room down to 14.66
IBB (Biotechnology) As this rested, may be the first place to look for a new buy entry
SMH (Semiconductors) Seeing shooting stars here as well, but with overbought RSIs would expect correction regardless
XRT (Retail) This is either a double top at 60.86 or a point to clear after some digestion occurs.
IYT (Transportation) Here is our designated driver again. Still struggling at the 200 DMA
IYR (Real Estate) This could be shades of things to come-as one of the big leaders of 2012, lagged last couple of days. Although not too concerned unless it breaks 63.35
USO (US Oil Fund) Subs: Booked 1.5 ATRs today and now holding the tail
OIH (Oil Services) 39.60 the 200 DMA level to hold
XLE (Energy) Although a bit overbought, the long term trend has changed to positive which means look for dips as buy opportunities
TBT (Ultrashort Lehman 20+ Year Treasuries)Cleared the 50 DMA. Now, has to do it again to confirm phase change
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.
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:
COF Has to hold the 10 DMA 56.39, then clear 86.80 then today's high
WFM Even though this sold off, now a condition 1 since the 10 crossed the 50 DMA. If holds 93.20 and clear 94.30, over today's high should also continue its journey 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: N/A
Category 3: (Double Up) Positive Phase, Condition 1 through 4, Positive Pivots which means can either buy a opening range breakout or candidate 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:
AMZN Lightly long. 235.90 area should now hold. Like to see it clear recent high 240.74
AXP Has to hold today's low. Narrow range day.
EW Should hold 100.60 and clear today's high to return to condition 1
HD Returned to condition 1. Max risk 51.53, closer 52.00 then over 52.68 R1 looks much better
LEN Has to hold 29.58 and clear 30.50 to really get moving
HMSY 34.56 is max risk and needs to clear 35.00
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:
ONXX Not oversold-has positive pivots and with an inside day has to hold today's low and clear today's high.
Phase Change: BA Big move on good vol. Now has to hold 73.42. MOS Crossed back over the 10 DMA 57.35 maxrisk SYKInside day. Max risk today's low and should clear 53.37
Shorts:
Category 5:Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
HLF Cannot break 53.81
CHRW Should not clear 54.27 and now has to break 53.55
Category 6: White Cap-Having a 2-3 Day correction over the pivots. In a Negative Phase, Positive Pivots. Can sell an Opening Range High Failure if happens below R1 or previous day high whatever is higher and/or weakness if breaks S1 and prior day's lows
WLT 8 days over pivots, inside day and overbought. Has to break 36.83 and not clear 37.96
Bye for now!