Flat has several meanings. 1. Smooth and even, without marked lumps or indentations. I wonder how many can say that about their equity after Tuesday’s session? 2. Lacking interest or emotion; dull and lifeless. That’s a yes! 3. In or to a horizontal position. Describes the market internals or McClellan Oscillator. The S&P 500 is flat. Flat as a word has several more urban definitions; but I will leave that to your own curiosity to look up online. Speaking of, Google (GOOG), far from flat, did make new highs.
Volume equally flat with an exception to the small caps, Russell 2000s, which posted a rather small distribution day. Remember, when you’re flat on your back, everything looks up!
S&P 500 (SPY) Held the fast moving average, which by the way, is flat. Subscribers: Negative Pivots in all
Russell 2000 (IWM) Broke the fast moving average with 111 an important support level
Dow (DIA) Closed just shy of the fast moving average but also on support. Also have to mention that IWM SPY and DIA did not make new highs recently while QQQs did
Nasdaq (QQQ) Marginally worked off overbought conditions
XLF (Financials) Volcker rule announcement had an impact. Sitting on support
SMH (Semiconductors) Holding the runaway gap
XRT (Retail) With a 6 day correction, 85.60 is pretty much the risk should this start to turn up
IYT (Transportation) Marginally held 128.40
IBB (Biotechnology) Held 219 and still digesting
IYR (Real Estate) 63.20 is the place to hold now
XHB (Homebuilders) Floundering around above the 50 DMA
GLD Gapped up so that reversal candle was good after all-now, 122 great resistance
USO (US Oil Fund) Cleared the 200 DMA-and baby, it’s cold outside!
XLE (Energy) 2 inside days-good one to focus on for range break
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs doesn’t believe taper talk it seems
EWG (Germany) 30.33 is the low of the island top to clear to negate that pattern
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) 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)
X Good day but unless market comes back, more interested in an opening range reversal (ORR)
SCTY Day to miniswing trade better to control risk. Had a good move off the 10 DMA at 51.50
BID A fave pick-Improved in condition to a 1. Today’s low perfect support. Long term charts intact.
GS Got to the top of the channel in a second and then closed ok-so another for an ORR
FITB 20.50 good point to clear
Category 4: (Rip Tide) N/A
Phase Change:
SBGI Unconfirmed phase change to bullish. If holds 33.25, then confirms phase change, good for possible swing
CCL Inside day-could be an add for a daytrade around position if holds today’s low clears yesterday high
OC 36.75 support and still needs to clear the 200 DMA
PLD Inside day. Like over 38.08
BEAM Bought the ORR, had an inside day and will add to the small position if clears 67.50
Shorts:
No great setups that aren't already oversold.
Bye For Now!
