This week’s evening watches will be prepared by Matt Mullins. Michelle Schneider will return on July 7.
Wow! New highs in all four of the major indexes. That was great, but now we must be cautious about chasing strength. As we near the Fourth of July, volume will wane. Therefore, it is likely that the market will spend the rest of the week digesting this move. I would not be surprised to see inside days in the indexes tomorrow. So, be cautious and focus on stocks with good volume, good support and instruments that have not already made a big move.
S&P 500 (SPY) New all time high and all time high close. Subscribers: Positive pivots in all indexes
Russell 2000 (IWM) Gapped over the important 6/24 high and kept going to new all time highs.
Dow (DIA) Cleared the 10 DMA and made a new all time high but, not an all time high close.
Nasdaq (QQQ) New all-time high and all-time high close- again! Getting extended and has a high RSI. Digestion likely.
XLF (Financials) This looks explosive over 23.00.
KRE (Regional Banks) Needs to clear 41.00.
SMH (Semiconductors) New all time high and closed over recent highs. Gapped higher for a possible runaway gap.
IYT (Transportation) Another instrument clearing recent consolidation.
IBB (Biotechnology) Breaking out of compression.
XRT (Retail) 88.95, the November high is the next resistance but may test it.
ITB (US Home Construction) 25.27 is the next resistance.
GLD Digesting
USO (US Oil Fund) Holding the gap, but barely. One of the weakest sectors.
OIH (Oil Services) Possible slingshot high.
XLE (Energy) Compressed.
XOP (Oil and Gas Exploration) Similar chart to XLE
TAN (Guggenheim Solar Energy) Love this longer term. 44.78 needs to clear.
TBT (Ultrashort Lehman 20+ Year Treasuries) TLT Filled a gap on the daily chart-now if it starts to roll over, would be interested in looking at a short
UUP (Dollar Bull) Inside day.
EWG (Germany) Nearing the 50 DMA
IFN (India Fund Inc.) 25.38 is the 80 month moving average
SGG (Sugar) Subscribers: Couldn’t clear the 200 DMA or the trendline. Broke the 50 DMA and is now in a confirmed Bear Phase.
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)
ADBE Nice move today but still in play. Watch for a breakout or ORR against the 10 DMA.
TSLA 241.88 has to clear if buying a breakout. An ORR against the 10 DMA is a possibility.
SCTY Looks good over 72.10.
JNJ Inside day. Watch for a breakout over yesterday’s high.
A Watch for a breakout or reversal against the 10 DMA.
LNKD Watch for a breakout over recent highs.
AXP Very compressed and can be explosive over recent highs.
EW Two inside days! Watch for a breakout over todays’ high and R1.
D Inside day. A breakout over the inside day range will clear recent highs.
EMN Watch for a breakout or ORR against the converging 10 and 50 DMA.
BIIB Looks good over today’s high.
Category 4: (Rip Tide) N/A
Phase Change:
IGT Watch for a breakout over today’s high.
MA Now in an unconfirmed Accumulation Phase. Watch for a breakout or ORR against the 200 DMA.
Shorts:
Not very many short setups on a day like today.
Bye For Now!
