Is there a more creative way to say drift and grind? That is the theme from last week. At the end of the day, S&P 500 and NASDAQ went sideways, Russells firmed a bit and the DOW lagged. The indexes had little in the way of follow through up or down leaving the best trading in certain equities-some flew, others crashed. Stock pickers had some fun. Sectors and groups had head fakes galore. Uptrend intact, but with a bumpier ride.
S&P 500 (SPY) 151.50 is a good number to defend once the week starts, otherwise, some correction likely. Subs: Positive Neutral
Russell 2000 (IWM) This index is hard to buy up here, with underlying support at 90.75 Subs: Pivots Positive
Dow (DIA) Broke the fast moving average with138.30 a good level of support to defend Subs: Pivots Negative but through R1 recaptures the 10 DMA
NASDAQ 100 (QQQ) Bullish phase. 67.55 support to hold. Subs: Pivots Negative. I would still be willing to buy this over recent highs.
GLD Significantly oversold on the daily Relative Strength Indicator
XLF (Financials) Looking like even with its starts and stops, on the way to 19.95 area. But a correction is not out of the question.
IBB (Biotechnology) Sideways and Inside day.
SMH (Semiconductors) 36.17 the 2012 high. 34.70 underlying support.
XRT (Retail) Looked like it was well on the way to new highs when it broke hard midday closing on the fast moving average. 67.60 now pivotal. Subs: Got long, took ½ ATR and got stopped out break even on balance. Now, will keep aside until the next move is clearer
IYT (Transportation) Made new highs, then closed just beneath the highs from Wednesday and Thursday. This suggests a correction is possible and a buy on strength a bit risky
IYR (Real Estate) Held the fast moving average with Friday's low. Subs: Like how R1 and Friday high line up.
OIH (Oil Services) Inside day
TBT (Ultrashort Lehman 20+ Year Treasuries) The last 10 trading days have all been within the range of the big trading range made on February 1st. Subs: Inside day, Positive Pivots. If holds S1 will look for a long entry
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: The picks were combed through and are here since they all have possibilities. Therefore, choose 2-4 to follow from different categories and/or watch for tweets after the opening range is in place
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:
IGT Could be flagging and took out the 200 weekly moving average last week. Needs to clear R1 and hold 16.14. Inside day
IR If Friday low holds, could be digesting before making a new leg up
BAC 2-day correction. Friday's low good risk if sets up above 12.07 then Friday high
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: (Opening range reversals are good on anything above S1)
CMI Doji inside day. Through 120 could get going. Support to hold 118.45
AGN Like to see 107 hold and clear recent highs.
V Improved in condition. Should hold the 10 DMA at 157.37 and clear 158.17
MOS* Still looks poised. R1 and Friday high line up. Has to hold 61.30
WHR* Third Narrow range day and if holds 109.50, watch this one for move back up to at least 115.
WY Through 30.67 could see follow through with support to hold Friday's low
MBT Pushing against the 80 monthly moving average with 20.10 pivotal and over 20.25 looking good
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:
EQT* Held the 50 DMA at 59.36 and is way oversold. The 50 DMA is a good risk should this firm
LVS Oversold. Held the gap from1/31 at 52.08 with Friday low 52.30.
Phase Change: NTES Holding the 200 DMA with 50.85 a good risk. Like to see it clear 51.50 UA Back over the 50 DMA if Friday low holds. Through 49.74 clears the 10 DMA YELP If 21.50 holds, returned over the 200 DMA and could see recent highs CHKP Golden Cross has to hold Friday low AFL* Confirmed Slingshot watch for reversal or follow through to upside
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
MLNX 53.69 good risk
NOV Inside day, Should not cross the 50 DMA 69.70
CRUS 27.95 good risk and next support 24.80
Bye for Now!
