After Monday's inside day, the follow through in the indexes was to the downside. However, S&P 500 managed to hold onto the 50 DMA as did the Dow. The Russell 2000 held last Friday's low but broke the fast moving average and has a long way down to the 50 DMA if it cannot hold here. NASDAQ is approaching oversold, and managed to hang onto some support. Bottom line is money is not on the short side, but, not necessarily the buy side either until the market proves it can hang on here and firm up over last Friday's highs. As far as the fiscal cliff, I am going to guess they vote to postpone the deadline by a month, leaving us traders to fend for ourselves.
S&P 500 (SPY) If we cannot clear 143, then 140 could be next place to look for support.
Russell 2000 (IWM) Held Friday's low barely with a bearish engulfing pattern. Then, a long way down to the 50 DMA, 81.92 if cannot get back above 84.00
Dow (DIA) 130 and the 200 DMA not so far away. Held onto the 50 DMA so perhaps a rally will restore buying, but not unless it crosses 132 with any confidence.
NASDAQ 100 (QQQ) 65.30 is the number to cross if there is anything left to the market as we close out the year. Then of course, the 200 DMA is the next area to penetrate. Downside, 64.25 is next area of support to hold then there is a gap to 64.02.
ETFs:
GLD Could not make it through the 200 DMA. Subs: S1 is 160.45 as per today's video instructions
XLF (Financials) Still in the best shape. Has to hold here 16.29. If can clear 16.44 would not be afraid
IBB (Biotechnology) Oversold and perhaps can hold here and 136.80 to look better
SMH (Semiconductors) Looking for the 50 DMA to hold
XRT (Retail) Landed on the 200 DMA. Has to do some work here to prove it can start 2013 looking ok. Otherwise, not a great sign if consumer confidence weakens
IYT (Transportation) Any dip to around 92.00 would be worth buying
IYR (Real Estate) To keep this going into 2013, some fresh news has to come out. The housing market has bottomed was in the market all year and now it needs a fresh boost or could sell off
XLE (Energy) 71.00 is key support with 72.20 now the resistance to clear or the 200 DMA will be next
UUP 21.70 should hold in UUP as today we began a long position we will add to over 21.80
TBT (Ultrashort Lehman 20+ Year Treasuries) 61.88 is where the last rally began from. Now, should act as support
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: Keeping list light for active trades-and am preparing an extensive report of setups to watch for 2013 which you will have by the end of the year.
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:
ASH 2 DOJI days. Over today's high clears R1 with risk 79.50 level good risk
TSO Has to hold today's low and clear pivots or 43.78
PHH 22.25 is max support as it consolidates after making new highs.
EXP If holds today's lows, over 57.25 clears pivots then R1 and today's high line up
GS holding recent gains provided 126.44 holds S1. Slightly positive pivots
Category 2: (Pipeline) 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:
DE Hammer candle which tells me that it must get through the 11/2 slingshot high 87.50 to get going. Also, like to see it hold today's low
NTGR 38.17 is the 10 DMA to hold. Over 39.30 could see move to 43.44 the 2012 highs
BA Inside day-more day to miniswing trade if sets up
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:
GILD 71.64 is the 50 DMA as this continues to hold the gap higher from mid-November
Phase Change: JNJ Over 70.40 clears the 50 DMA BIDU Unconfirmed phase change to recovery. If holds 100, look for a reversal or continuation and 2nd close over the 50 DMA CLF* Unconfirmed phase change to recovery. Over 36.63 looks good and a pick for 2013. MOS Prefer a reversal but with gap today holding recent gains well RGLD Holding the 200 DMA which means if continues to hold, slingshot pattern is good POT Back to unconfirmed recovery phase. If today's low holds, like it over 40.15 P* If 8.87 holds, like this especially if can hold over 9.05 intraday BXP Over 106.07 R1, will take another stab at a long if it holds 105.50 MCP If comes in over 9.75 will look to buy with stop under 9.60
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
MJN Inside day and now negatives pivots. Good short under today's low with risk to today's high
FB Had a slingshot 12/03. Now, 27.00 resistance with possible mpove down to 25.00
Bye for Now!
