It’s All GREK To Me!
Certain things about the 2015 market make perfect sense to me. Like why watching the Retail sector is a solid way to gauge the sentiment of the economy. Or, why following the Russell 2000 or small caps sheds further light on how another driver of the US economy, small businesses, are faring.
I can wrap my head around the Federal Reserve and the war within that has to be raging between Yellen and her team on raising the interest rates, when and by how much.
What we all seem to be grappling with though, is the Greece situation, which has been going on since 2009 when the sovereign debt crisis developed among investors concerning Greece’s ability to meet it debt obligations.
Therefore, for consistency’s sake, I am adding GREK, the Global X FTSE Greece ETF, to the Economic Modern Family as the obnoxious cousin by marriage (like Eddie in National Lampoon’s Vacation), who is always broke and pawns off the cranky Aunt Edna and her mean dog Dinky on the Family.
Speaking of the Economic Modern Family
The Russell 2000s are holding the 50 DMA therefore remain best reason to stay positive. Retail is close enough to the 50 DMA to think any bit of good news will send that over it. Regional Banks are holding for the possibility of higher interest rates. Transportation, although weaker than everyone else, are above the recent lows. Semiconductors and Biotechnology are doing okay, just waiting for signs from the others before attracting new speculators.
Cousin GREK in the Lampoon’s Christmas sequel, becomes an unlikely hero, forcibly securing a Christmas bonus for the Family that had been scrapped earlier by Clark’s (Russell 2000s) boss.
Maybe, just maybe, with the optimism that remains in the IWM so close to the highs, we can see the rest of the market, along with Greece, looking at the sky, happily smiling toward the stars and saying, “I did it!”
S&P 500 (SPY) Confirmed warning phase. If history repeats itself, at the lower end of the trading range, a bounce is possible Subscribers: Negative Pivots in all
Russell 2000 (IWM) Held where it needed to so not bearish yet
Dow (DIA) Confirmed warning phase. Over 178.72 will be good as it is on the lower end of its trading range
Nasdaq (QQQ) Failed the 50, held the 100 DMA making the 50 DMA resistance unless it can clear it
XLF (Financials) 24.85 pivotal area
KRE (Regional Banks) Like this still
SMH (Semiconductors) Has to clear 58.00 and hold 56.25
IYT (Transportation) Held 150-best I can write for now
IBB (Biotechnology) Sideways so not in bad shape
XRT (Retail) Has to close over 100 or under 96.00 to be a game changer
GLD (Gold Trust) A close over 114 will get us interested
USO (US Oil Fund) 20.20 resistance and the 50 DMA 19.89 support
TAN (Guggenheim Solar Energy) Like even more over 43.00
TLT (iShares 20+ Year Treasuries) Inside day-not surprising ahead of the Fed
GREK (Greece) If opens over 11.33 a good sign
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
***Market Tone: Short-term Negative 4, Intermediate-Term Negative 1, and Long-Term Positive 5. NOTE: Market Tone is updated before the open each day and changes in real time throughout the day.
*All starred picks are from the automated list of picks
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:
MYL Over R1 like for a mini to swing risk 72.84 as best and needs some volume too. 5-30 minute OR
*C If holds today’s low, like over pivots for ½ 56.60 and then over R1 or 57.04 for the other ½ Mini to swing 5-30 minute ORs
*FDX If holds 181.14 like over pivots for ½ 182.46 then R1 183.48. Mini to swing
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)
SGEN Slightly negative pivots. Like for day to mini against the 10 DMA 46.50 and over 47.13 Any OR
*GLPI Prefer an ORR but over 37.50 clears a lot of congestion. Swing risk 35.50, mini risk is today’s low
*CROX Over 15.50 clears the weekly moving average. Risk is to today’s low day to mini. Any OR
Category 4: (Rip Tide) Oversold (2 or more days under FTP), Condition 4, Needs to clear R1, Risk previous day low unless noted differently, Target- Day to at least 3 ATRs from entry:
EBAY Against the 50 DMA is risk 58.99 with a move over R1 60.37 best thing to wait for 5-30 minute OR mini to swing
Phase Change: N/A
Reversal Trades: (Glass or Brick Wall Bottom or Top):
GMCR Confirmed the reversal pattern. Risk to Friday’s low Any OR swing. Over R1 sets up for a possible daytrade to mini-85.61
SFM If holds around 28.00 like risk to under 27.00 for swing. Any OR
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
PXD Risk 149.80 and could see down to 143.75 the 200 week moving average Any OR
Category 6: N/A
Best Best wishes for your trading,
Michele Schneider
