Summer light versus Winter shade the title of Monday’s daily. Tuesday night I quoted Led Zeppelin withMany Times I Loved, Many Times Been Bitten.
Now, is it me, or are those titles downright prophetic? Or maybe it was China, and the anomaly I wrote about that had me spooked. All I know is that nobody likes to see new highs as NASDAQ made or a new 60-day high as the Russells made, followed by a sharp about face WITH volume.
So one thing you should know if you are a consistent reader, EVERYTHING needs confirmation with a second day. Tuesday action no exception. Both IWM and QQQs closed pretty much right on the fast moving averages. Recoverable if they can hold here and turn back up.
The S&P 500 and the Dow closed beneath the fast moving averages. Even Semiconductors had the worst one day decline since April 4th after making new highs. That move drove prices lower for a month before a good volume up day occurred on May 5th.
Now that we are looking at SMH, it had a runaway gap on Friday the 13th-the full moon day incidentally. That low was 48.54. Therefore, a move below 48.38 will not only fill that gap, but seal the fate perhaps of the party that has been wilder than the ones thrown at the Playboy Mansion-never been-just conjecturing.
Let’s look for Wednesday confirmation or no confirmation. The Indices, Semiconductors should be enough to look at. Energy, the other amazing sector, also reversed actually on Monday.
One more thought though-China-the gap down on Monday was disturbing. The second gap down on Tuesday in the midst of NASDAQ making new highs was even more baffling. Baidu roaring further contrasted FXI. And what about Dubai? That country ETF is down over 25%!
S&P 500 Not crazy blow off volume, so perhaps will hold and turn back over 195 (SPY) Subscribers: Negative Pivots in all except QQQ
Russell 2000 (IWM) Never came close to new highs so this really has to show some muscle now
Dow (DIA) 168.50 pivotal 167 n0065t support
Nasdaq (QQQ) 92.80 drove this up, then failed end of day. Good pivotal area still with more weakness and see this drop to 91.40
XLF (Financials) 22.93 high to clear or with further weakness, see more correction in store
IBB (Biotechnology) Vertex gave this a big lift, but it still closed near the intraday lows. Look here too
XRT (Retail) Actually, since this never cleared the 2014 highs, could just need to do more work between 84.00 and 87.00
ITB (US Home Construction) Closed over 24.36 making this a place to go for strength
GLD Maybe a new 60 day high and done-but has to confirm that
OIH (Oil Services) Ugly looking but not dead yet
XLE (Energy) Ugly looking and might be dead
XOP (Oil and Gas Exploration) 5 days to rally and one to drop
TAN (Guggenheim Solar Energy) 42.00 should hold if this is good
TBT (Ultrashort Lehman 20+ Year Treasuries) TLT And, we are right back over the 50 DMA
SGG (Sugar) Subscribers: Once more push gets this over the 200 DMA and this time, have to follow
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:
GCI Improved in condition to a one after holding the 10 DMA making today’s low a good risk and over 29.50 a good buy point
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)
NFLX Really, has to clear 450.82 but with good pivots, 435.20 or the 10 DMA worth watching
GMCR Held the 10 DMA but I would wait for 124 to clear
PLD Improved in condition but wouldn’t give this more than to today’s low for a miniswing trade.
GOOG 557 are if serves as support keeps this on the list
BIDU 179.50 now support to hold
HD 80.85 clears 4 days of work-slightly negative pivots
CSC Got in got out-but these days, learned that has to close on new highs if buying for that reason. Still in good shape though if today’s low holds down to around 63.75.
FB 64.90 now key support here
YUM I would keep eyes here-still looks good against 79.80
Category 4: (Rip Tide) N/A
Phase Change:
BBY If today’s low holds, could be seeing it pull away from a bottom formed at 28.00
YOKU Confirmed the recovery phase. 21.20 has to hold now and one more shot over 22 to add
BZH We daytraded this. Now, need a second close over the 200 DMA 22.16
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
DE Ideally, the short came today but, if cannot clear 91.02 could stil see that 200 DMA eventually at 88.00
IBM 182.16 is the risk here now and looks like it has lots of downside room
LMT 164.05 good risk as this broke beneath the 50 DMA for an unconfirmed warning phase
VMW If cannot clear today’s high then still see this much lower over time
Category 6: White Cap-N/A
Bye For Now!
