Last week Russell 2000 improved to a bull phase, while S&P 500, NASDAQ had yet to catch up. The DOW, never got close , barely hanging onto a warning phase, which with the start of the week, deteriorated back to a unconfirmed distribution phase. The others even with the noise are status quo. Low volume selloff with some bearish looking candles, although the market internals especially in NASDAQ remain positive.
S&P 500 (SPY) There is concern that this backed off so much from the 50 DMA after gapping above it early in the day. 142.51 clears the 50 DMA 140.75 support to hold based on the fast moving average. Subs: Negative Pivots
Russell 2000 (IWM) Wrote on Sunday that the way it breaks on Monday should help to set the tone for the day and possibly the week. It maintained the strong phase provided 81.80 holds. Subs: Pivots Positive
Dow (DIA) Closed below 129.75 the line in the sand, which means if does so a second day, a real reason for bulls to be cautious. Subs: Pivots Negative
NASDAQ 100 (QQQ) Couldn't clear the overhead 50 DMA resistance as now watching to see if this does hold the 200 DMA at 65.50. Subs: AAPL, Closed green and with positive pivots so S1 is important
ETFs:
GLD Inside day with a hammer candle. Unclear.
SLV Sitting above the 50 DMA also with an inside day, hammer candle and DOJI
XLF (Financials) Until this clears 15.85, hard to get too excited about the market
IBB (Biotechnology) 2nd Bearish engulfing pattern on the 50 DMA. An inflection point
SMH (Semiconductors) Began the week under 32.00 or the 65-weekly moving average. Subs: Over 32.43 and the prediction of a strong SMH into 2013 looks more likely. Til then, out of its way
XRT (Retail) It could be just resting, but better wake up soon or at least hold 62.50
IYT (Transportation) Subs: Back in the middle of the channel and looking for the 50 DMA to hold
IYR (Real Estate) Cleared the 200 DMA for an improved phase change. Subs: I also like this especially over the 50 DMA
OIH (Oil Services) Death cross last week with a now heavier looking chart
XLE (Energy) Subs: Stopped out for a scratch on the long and closed under the channel making the 200 DMA next support to watch
TBT (Ultrashort Lehman 20+ Year Treasuries) 60.00 next support with 60.60 pivotal
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: Good time to keep eyes on the beta of the market as many stocks have been changing phases with little follow through once they do.
Glass Ceiling High Patterns if confirm: PCP EBAY NBL ORLY ROK LTD MA V (Precisely why taking profits at 1.5 ATRs while phase is still funky in overall market makes sense)
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:
BEN Has to hold today's low and ideally, clear today's high
RGR If the legislators do not come up with a resolution soon, expect this could continue the uptrend. Has to hold 55.55
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:
GILD 2 days under pivots and now has to clear 75.77 to look explosive
PM Narrow range day with 89.20 the 50 DMA max risk
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:
TRW Has to clear 51.22 and hold 50.37 last Friday low
HFC has to clear 45.80
URI 41.50 a good level to hold
CELG Until it clears 79.80 stay aside. Inside day
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:
SHW oversold daily RSI and very close to key support at the 50 DMA
Phase Change: BIDU now has to hold 95.40 after 2 inside days SPG Max risk today's low has to clear today's high MBI Almost 3 inside days which means over 9.06 would follow. SYK Like to see it hold 54.00 and now clear 55.08 KORS has to hold 53.25 to keep the phase change to recovery EL Today's low has to hold AIG Inside day and real close to the 50 DMA so worth watching DKS 2 inside days. 52.00 max risk
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
ROSE Under S1 also confirms a distribution phase with risk 45.15 a tight risk
BHI 43.37 should not clear and has some support at 42.00
JOY Shouldn't clear 56.70 level
BBBY failing the 50 DMA and should stay under58.90 the fast moving average
AGU big selloff from the 50 DMA and now 101 area resistance 95.50 support
Bye for Now!
