From orange and red to green? Not quite my friends. The indices moved off the lows, but with neither enough oomph to clear the major moving averages or even the Floor Trader Pivots or volume, which was above average, but not nearly enough to reverse the plethora of distribution days over the last 2 weeks.
Furthermore, all the indices had inside days (when the trading range is within the trading range of the day prior.) Therefore, best we can say is that the stage is set to follow the break of the range one way or another with no hesitancy to sell should it be to the downside below Monday’s lows.
Once again, eyes peeled on the Dow, the weak sister who can regain her strength should she return above the 200 DMA and stay there.
S&P 500 (SPY) 176 would be a great place to start. Otherwise, under 173.93, hello 200 DMA Subscribers: Negative pivots in all
Russell 2000 (IWM) 110.16 the place here to clear otherwise, under 108.15 hello 200 DMA
Dow (DIA) 154.68 a great place to clear or we just merely confirmed the distribution phase with the first time since the end of 2012, this traded under the 200 DMA
Nasdaq (QQQ) Two points to clear really-first, 85.31. Then, 86.30 to really cheer. Otherwise, help 81.35-a bit higher than the 200 DMA if breaks Monday low
XLF (Financials) Next time under 20.40 not pretty
SMH (Semiconductors) Now this is getting my interest if it clears 40.45 Subscribers: A hold over 40.45 would look like a slingshot low
IBB (Biotechnology) Although still bullish hasn’t proved that it didn’t peak out
XRT (Retail) Another inside day shaking confidence on this being a bottom
IYR (Real Estate) Inside day and in better shape if holds
XHB (Homebuilders) Also interesting as it held the 200 DMA with an inside day.
GLD Slightly red and pretty lackluster-pun intended
USO (US Oil Fund) Subscribers: We hung in there today. Inside day so pay off will be if clears 34.90
XOP (Oil and Gas Exploration) Inside day above the 200 DMA making this yet another contender
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs Inside day above the 200 DMA confirming the improved phase change
TAN (Guggenheim Solar Energy) Subscribers: Could really go either way from here-if holds the 50 DMA all the better
CORN (Corn) Subscribers: Unconfirmed phase change to weak recovery
JO (Coffee) Subscribers: P2 today
SGG (Sugar) Subscribers: If still good should hold 53.40 and get back and close over the 50 DMA
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: New and Old Subscribers: I do not include on the list 1. Anything with a weekly or daily RSI over 92 2. Anything within 4 days of reporting earnings 3. Anything with a risk over 1 ATR from its current close4. Anything with only one day under the Floor Trader Pivots (unless specifically noted. 5. Anything with a potential slingshot or brick wall high (new 60 day high, close in the bottom 25% of the intraday range.
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:
TEVA Inside day over the 10 DMA with risk to under 43.92 if clears R1 44.65
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)
BHI Nice start. Now has to clear 57.34 and hold 55.85 for a swing trade
Category 4: (Rip Tide) N/A
Phase Change:
PLD Cleared back over the 200 DMA and now flagging with break over 38.80 with risk to today’s lows
SWI Reports-if opens above 42.16 clears recent highs and looks good with risk for swing around 41.00
AAPL Now has to clear 512-513 to see a post earnings price move up. Risk would be under today’s low
WLP Like this even better against today’s lows if clears R1 and today’s high or 86.07 for a swing
KBH 18.50 max risk on this inside day which means follow over 19.34
HOG Confirmed the brick wall with our swing position and risk under 60.55, looking for a clearance now of the 10 DMA 63.85
TRIP Reports February 11th We have a small long with the inside day and now over R1 and today’s high might consider an add for another daytrade keeping the core position. Risk is around the entry price for the miniswing
AMPE Had an inside day after a retracement to the 50 DMA. Over 8.68 really R2, looks good against the 50 DMA
CNQ Unconfirmed phase change to bullish. Good for an ORR or move over today’s high with risk to the 50 DMA
Shorts: Focus on the ultrashorts if market fails and perhaps FAZ
Category 5: Titanic-N/A
Category 6: White Cap-Having a 2-3 Day correction over the pivots.. In a Negative Phase, Positive Pivots. Can sell an Opening Range High Failure if happens below R1 or previous day high whatever is higher and/or weakness if breaks S1 and prior day’s lows
MOS Reports February 11th. Classic if breaks S1 and Monday’s low with an inside day
Bye For Now!
