Well, the weather outside might be frightful (in the Southwest anyway), but over the roaring kivas, I could see Santa carrying a sack full of stocks as the week ended!
But he certainly carried with him that list of which companies were naughty and which were nice.
Santa loved solars last week-a sector/group I have been watching for months. He gave the nod to green energy apparently as there are several instruments that have already shown great basing while the ETF TAN looks promising.
His dimples were merry as he filled STOCKings with Tesla cars as well.Furthermore, as Santa turned with a jerk, China gapped higher and closed near the 2014 highs.
He was a right jolly old elf, taking out of his pack, gold, GPRO gadgets,iPhones and 3D printers. Then he handed out Mastercards and AmazonPrime! His round little belly that shook when he laughed, was filled with Panera,Buffalo Wild Wings and Kraft!
Yet, as he laid a finger aside his nose, and before he nodded and up the chimney he rose, not all were merry. Santa kept oil and gas on that naughty list big time. Nor did he drink coffee with those cookies that were left out for him. He didn’t seem too concerned about healthcare either.
This week, with Santa now gone for another year, auld lang syne sets in. Will old acquaintance be forgot? The signs point up and when volume returns after the New Year, the market could rocket higher. I will say this, at a Boxing Day brunch we attended on Friday, everyone wanted to talk to us about the market. All seemed incredulous or at the very least baffled to this current rally. All loved lower oil prices.
I can surmise that the oil remains key-now better if stays cheap. Interest ratescan firm but not too quickly. And of course, my favorite-the Russell 2000s-so much of the US economic meat and potatoes live there. With Friday’s high so close but yet not enough to take out 120.97 the 2014 high-we have 3 excellent places to focus for clues.
S&P 500 (SPY) 208.47 was the high, now its 208.85 with a close on new highsSubscribers: Positive pivots in all
Russell 2000 (IWM) Couldn’t meet the 2014 highs of 120.97 with Friday high 120.83. However, unless it breaks under 117, see any dip still good buy zone
Dow (DIA) Last 3 days of price action could be a yet another launch pad unless it breaks 176
Nasdaq (QQQ) Unless this gaps below 103.10 and continues to fail from there, has to clear 106 now for sure
XLF (Financials) 24.50 support and has to clear 25.08 after 2 Inside days
KRE (Regional Banks) Love it over 41.00
SMH (Semiconductors) Lagging behind so for now, not the place to be unlessyou want short setups if the market drops
IYT (Transportation) Cleared resistance-has more to go
IBB (Biotechnology) The bigger they are, the harder they fall, the better they bounce
XRT (Retail) Tried to make new highs and sold off some near end of day-tired perhaps but not destroyed
IYR (Real Estate) Unless it breaks 77, mostly noise
ITB (US Home Construction) Nice looking chart and looks good for 2015-but for now, would stay aside
GLD (Gold Trust) Popped up again and does seem a bit confused as to what it wants to do from here
USO (US Oil Fund) 21.94 the real point to clear otherwise still heavy
XLE (Energy) The 50 DMA is resistance point 82.86
TAN (Guggenheim Solar Energy) Subscribers: That 50 DMA is what I am waiting for
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs rebound some on Friday-125.50 now resistance
UUP (Dollar Bull) Consolidating at new highs
CORN (Corn) Subscribers: Looks like its bottoming out
BAL (Cotton) Subscribers: Cleared the 50 DMA for an confirmed phase change to recovery-see if it sticks around 41.52
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: N/A
Category 2: N/A
Category 3: (Double Up) Positive Phase, Condition 1 through 4, Positive Pivots which means can either buy an 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)
PNRA New recent highs but still lots of room if holds now around 172-miniswing best
LO 62.60 support to hold and does appear to be heading higher especially if clears 64.00 for swing
PAY Inside day. Underneath support at 36.05 and like over 38.40 for swing
WMT 86.00 support now and over 87.15 looks higher to hard to say-uncharted territory. Swing
EXPE Over 90.00 like for a mini to swing with risk 87.90.
GERN Friday this turned around-now like again for new swing against the 50 DMA if holds 3.14
Category 4: N/A
Phase Change:
OC Closed the week at the 200 weekly moving average. Like over 35.62 for swing
SUNE Unconfirmed phase change to Accumulation. If confirms looks good for swing
ONVO cleared the 200 for an unconfirmed phase change to Accumulation. If hinds 6.60 and stays about 705 like the basing action for swing
GLPI Basing-needs to hold 29.00- Like over 29.75 for swing
SFM Over 33.18 clears months of work and now can use a risk to 31.65 for swing
DDD Soared on Friday. Would like to add back the other 1/2 around 32.20
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
XOM Back under the 50 DMA with resistance now at 94.23. Looks heavy under 92.45
AWAY If cannot clear 29.26 see a short under S1 since pivots positive 28.71 mini to swing
UA If breaks the 50 DMA at 67.84 and S1 67.80, then resistance at 68.55 for mini to swing
OVTI Has to break S1 26.42 and not clear 26.71 for mini to swing
Category 6: N/A
Best Best wishes for your trading,
Michele Schneider
