The Dow closed red but after making a new low since the low made in mid-October, one possible indicator going into Thursday is that it reversed from that new low and closed in the top part of the intraday range.
This could be important if it gaps higher. Equally and in the direction of the negative phase, it could also mean nothing if cannot clear the 200 DMA.
Ahead of jobs report and with a lack of fresh news, expectation is for another choppy day filled with indecision. However, expectations may turn out meaningless.
Best shape is NASDAQ. Even though the phase is weak warning, the 50 DMA remains within reach should the market get happy again.
For now, all of the key sectors and groups fail to wow. This could be the calm before the storm. Question is which way does the wind blow?
Finally, Twitter reported after the close. At time of writing TWTR posted a 13% decline. Not a happy sight.
To see today’s interview with Keith and me hosted by Dale Pinkert at FXstreet, click here- https://www.ustream.tv/recorded/43479340?utm_campaign=ustre-am&utm_source=ustre-am&utm_medium=social
S&P 500 (SPY) Subscribers: Negative pivots in all
Russell 2000 (IWM) Perhaps through Wednesday’s high a temporary game changer, but still believe the key is the Dow.
Dow (DIA) The 200 DMA sits at 154.56.
Nasdaq (QQQ) 86.34 the 50 DMA far away but worth noting
XLF (Financials) 2 Inside days. Next time under 20.40 not pretty
SMH (Semiconductors) Almost looked good, but almost surviving the operation, well, you know. Subscribers: Like to see it clear today’s high
IBB (Biotechnology) The 50 DMA getting closer
XRT (Retail) Possible low put in-possible
IYR (Real Estate) 2 Inside days. Focus here with this pattern.
GLD Slightly green and lackluster continues to come to mind although the phase is getting a bit stronger
USO (US Oil Fund) Subscribers: Paused
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs failed the 200 DMA-another puzzling piece of the puzzle
TAN (Guggenheim Solar Energy) Subscribers: Failed the 50 DMA and closed above it anyway-better shape than most
CORN (Corn) Subscribers: confirmed phase change to recovery
BAL (Cotton) Subscribers: Like over 54.00 against the 200 DMA
SGG (Sugar) Subscribers: Inside day above 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: A good time to be extremely patient and selective. A major focus will be on individual instruments that either outperform and hold a major moving average or fail the moving average, but come back through with a slingshot pattern on good volume
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)
TEVA 45.60-46.00 a good area to clear with risk to today’s low
BHI Inside day and sitting in a good spot to pop over 57.27 R1
Category 4: (Rip Tide) N/A
Phase Change:
PLD If holds the 200 DMA looks good especially over 39.18
RIO If holds today’s low then can watch for a move over 53.16
SWI Reported well. Watch for an ORR
WLP Has positive pivots even though we exited early. Now, has to hold today’s lows and we can look again
TRIP Reports February 11th 2 inside days
AMPE Over 8.55, looks good against the 50 DMA
Shorts: Focus on the ultrashorts if market fails and perhaps FAZ
Bye For Now!
