If this weren’t April Fool’s Day, I would say the end of day rally was a fool’s game. However, fools are just that-fools, so they cannot possibly control all the salient factors in play.
First, looking at volume, there was an accumulation day in both NASDAQ and the Russell 2000s-both of which needed to show life after lagging. It is noteworthy though, that S&P 500 made a new high close on low volume as did the Dow.
Second, NASDAQ cleared the 50 DMA. Now, in an unconfirmed Bullish phase, that must stick.
Third, the Russell 2000s confirmed the bull phase.
Interest Rates firmed too. But, that could be more a sign of relief that there is some room for firmer rates, provided they do not firm too fast.
So now that all indices and most sectors and groups are in play, perhaps we can give Michael Lewis some credit that if the markets are rigged-at least the bulls can celebrate!
S&P 500 (SPY) New high close, but not new highs. For that has to clear 188.96. And like to see some not huge volume. Subscribers: Positive Pivots in all
Russell 2000 (IWM) Cleared the fast moving average and now has some distance to see 2014 highs 120.58. And must hold 116.68 then the 50 DMA for sure
Dow (DIA) Although this made a new high close, it has not cleared the 2014 Calendar Range-even with the recent strength
Nasdaq (QQQ) Cleared the 2014 Calendar Range and now, needs to hold the 50 DMA
XLF (Financials) If holds Monday’s low that’s good but still needs to clear 22.40 and close above to have a chance to negate the topping candle.
SMH (Semiconductors) Semis-semis semis!
IYT (Transportation) 136.89 is right there for the taking
IBB (Biotechnology) Unless this clears 245, still vulnerable although happier with the market action
XRT (Retail) Good move but still well underperforming
IYR (Real Estate) 68.85 is the real place now to cross but this has been better lately than how the year began, even before the market came back
GLD Weakened but has not violated key support at 121
USO (US Oil Fund) Broke the 200 DAM but held the 50 DMA-interesting to see what happens now
XLE (Energy) Nice new highs again
XOP (Oil and Gas Exploration) New high close
UUP (Dollar Bull) Hasn’t closed over 21.50 since late February-good point to watch
KRE (Regional Banks) Nice looking as it negated the topping candle
FXI (China Large Cap Fund) Subscribers: Looks like it wants to clear the 200 DMA
TAN (Guggenheim Solar Energy) Subscribers: 45.35 is the 10 DMA to cross
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
Existing Position Comments:
*PM Over 81.88 and we are looking at for P1 neat 82.70 area
*HSP Took P12 now trailing stop
**XRX Looking for P1 around 11.64
**ONVO Confirmed phase change-like to see it clear 8.00
**YUM Long for a hybrid which means want to see this hold 74.50 now and bust through 77.35
Category 1: (Aloha) N/A
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)
AAPL Closed well and like to see follow through over today’s high. Risk is 10 DMA
TSLA using today’s low, like if holds this move over the 50 DMA. Has to clear the 10 DMA and then can see 230
HOG Like mainly on an ORR against the 10 DMA for move to 70 and maybe beyond
BEAV Made new 2014 highs and cleared the Calendar Range-risk has to be today’s lows and if good could see 98.00
IBN Close to the highs with a good risk to today’s lows and looks good on longer term charts to around 49.00
FFIV unconfirmed phase change to bullish if clear back over 109.75 area and holds today’s lows
Category 4: (Rip Tide) N/A
Phase Change:
STT Over 70.72 has a gap to fill at 72.54-miniswing
AXL If clears today’s high then moves over the 50 and 200 DMAs. Risk would be to today’s lows
AFL If today’s low holds, still good for a move over recent congestion at 63.50
TWTR Still like this especially now over R1 and today’s high
ALGN Rather than chase, like now for an ORR against the 10 DMA
SCTY Risk is harder to define, but like if holds over 65.00
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
CAH If cannot clear today’s high, it broke the 50 DMA and could see a drop for a mini to maybe swing trade to around 67.50
Category 6: White Cap-N/A
Bye For Now!
