Interesting how attractive a major moving average can be as far as drawing an instrument to drop or rally to it. Such is the case with the S&P 500. After the Real Estate Exchange Traded Fund illustrated how an instrument can attract to lower levels where major moving averages sit, the SPY followed in kind stopping just short of the 50 Day Simple Moving Average. Similarly, so did the Dow and NASDAQ. Only the small caps (Russell 2000) held well above. Also interesting is that this week we have not broken through last week’s lows and the 50 DMA remains in an upward slope. Therefore, at this time, the status of the market remains one of “correction”. However, if the market follows the Real Estate ETF, that could be short-lived and we could be looking at a phase change to warning.
S&P 500 (SPY) 2nd Distribution day in volume. 161.18 is the 50 DMA and last week’s low 160.25. One sneeze from the FED, watch for a reversal over 163.50 Subscribers: Negative Pivots in all
Russell 2000 (IWM) Nasty bearish engulfing candle, but still far from last week’s low 95.73 and the 50 DMA 95.23. A move over 98.00 would ease the pain
Dow (DIA) Last week’s low 148.31 and the 50 DMA 149.47
NASDAQ 100 (QQQ) Last week’s low 71.47 and the 50 DMA 71.44-double confirmation of just how important that area is now
ETFs:
GLD 135 resistance with 130 a very substantial area of support-with sentiment still bearish unless it gets back over the 50 DMA
XLF (Financials) Holding the 80 monthly moving average for now
IBB (Biotechnology) Amazing how it tried 180 then turned and dropped to the 50 DMA or close 174.13
SMH (Semiconductors) 37.00 support
XRT (Retail) Failed the fast moving average with daily chart support still intact
IYT (Transportation) The 50 DMA and 111 are really close together making that a key level to hold or fold
IYR (Real Estate) Pretty oversold now, but at time of writing, not seeing a any substantial signs of a bottom. Watch the 2013 low made the first trading day of the year
USO (US Oil Fund) Has to clear 34.24 to continue the move up
OIH (Oil Services) Confirmed warning phase now-going the way of IYR it seems
XLE (Energy) Trip to the not so bountiful 50 DMA
TBT (Ultrashort Lehman 20+ Year Treasuries) After the Reversal candle today it had an inside day. TLT through 114 confirm a reversal if gets there
XOP (Oil and Gas Exploration) Critical support levels here
XHB (Homebuilders) Inside day near last week’s low in the now warning phase.
UUP (Dollar Bull) Oversold Subscribers: On sights for a reversal over the 200 DMA possibly-aside though now
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: Please follow the instructions in the email you received regarding getting into the Day Trading Room with Matt and Geoff while I take off for a couple of days.
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:
GD Inside day. That means the high and R1 are the areas to clear with 77.80 now max risk. Probably one of the better looking charts.
MET As one of the featured 80 monthly moving average trades, held up over S1 making 44.09 a good risk with a move back over today’s high a good sign for continuation
PFG Crossed the 80 monthly moving average last month. Inside day max risk 37.00 but the 80 monthly is down at 35.07. Has to clear 38.65
Category 2: (Pipeline) Positive Phase, Condition 2-3, 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:
LTD Has to hold 49.78 and the 50 DMA. But, the slopes on the 10 and 50 DMAs remain up giving this a worthwhile look see over the 10 DMA 50.65
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)
BBBY Feeling the pressure of the market, but holding up well. 68.80 a good point of risk. If it can clear 70.00 should be good to go
YELP Has positive pivots with 29.00 now the max risk and really like to see it clear R1 30.00
BSX Inside day holding the 10 DMA at 9.29 good risk.
Category 4: (Rip Tide)N/A
Phase Change:
PM Inside day. Starter position on now with stop under the 200 DMA 90.42 and if can clear today’s high will add
BXP If it holds 106.18 the slingshot low, and can clear today’s high, it will be a good test of that low and another buy opportunity for a swing trade
WLL Looks a bit like the USO in that it is in a confirmed accumulation phase but, needs to clear 48.00 to keep going. Tight risk 47.27
Shorts: (NFLX CHRW and CNQ all really great short setups today)
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing.
CHRW Has some support coming up around 55.70 which now has to break
Category 6: N/A
