“Don't Know If I Should Go Sailin Down No Hill”
Tuesday, without Cousin GREK’s help, the overall market, especially GranddadRussell 2000 and Prodigal son Regional Banks, rallied anyway.
Yet, not everyone in the Economic Modern Family ignored the dense but bighearted cousin’s warning signs. Transportation is still not having any part of it, stuck near the lows established over the last couple of weeks. Tranny loves his Grandma Retail however. So, she’s vowed to sit around the pivotal 150.00 level, provided Retail holds and confirms over the 50 DMA and better still, Tranny will most likely pull herself over 152 if Granny Retail can close above 100.
Our ongoing miniseries did not conclude Tuesday’s session showing us any real coming attractions for Wednesday. To see how the members of our family reconcile or depart from further Greece woes, we have to wait until the Producer, Traffic Cop-whatever we wish to call the one holding the cards, (even more so than Cousin GREK it seems)-the Federal Reserve-shows a definitive hand.
Semiconductors and Biotechnology, as mentioned multiple times, do not need to lead. Nevertheless, interesting to note that both of these sibs are a really good indication of how many speculators are willing to come to or not come to the party. After all, US Investor Sentiment, % Bullish is at 20.04%, compared to 27.34% last week and 39.51% last year. This is lower than the long term average of 38.84%.
With a rate hike likely this year, (although many do not expect one to be announced for June), that will give the market and the fate of our Family, four more Fed meetings in 2015 to stress out over until a definitive statement is made.
In the meanwhile, Cousin Eddie (GREK), who’s quoted as saying, “Nothing between the ground and my brains but a piece of government plastic,” if we replace that with Prime Minister Alexis Tspras’ statement that the IMF has “criminal responsibility” for the damage caused by Greece’s austerity programs, we get the US Treasury Secretary urging Cousin GREK to play nice, (for the sake of the US Family.)
You can stretch the allegory, but you can’t make this stuff up!
S&P 500 (SPY) Stopped just shy of the 50 DMA-not surprising as it sits and waits Subscribers: Positive Pivots in all
Russell 2000 (IWM) 127 the place to clear!
Dow (DIA) Has a couple of daily moving averages to clear-also not surprising since this is where lots of trannies live
Nasdaq (QQQ) Unconfirmed phase change to Bullish-just barely
XLF (Financials) Very strong ahead of Fed
KRE (Regional Banks) New highs-yay!
SMH (Semiconductors) Unconfirmed phase change to bullish if holds around 56.80
IYT (Transportation) Held 150-best I can write for now
IBB (Biotechnology) More sideways
XRT (Retail) Unconfirmed phase change to bullish yet 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) Cleared 20.20
TAN (Guggenheim Solar Energy) Inside day. Like even more over 43.00
GREK (Greece) If opens over 11.00 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 Positive 2, Intermediate-Term Positive 2, andLong-Term Positive 7. 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:
FDX If holds 181.13 like over pivots for ½ then R1 183.86. Mini to swing
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:
DE Inside day. Has to hold 91.24 although the 50 dMA is at 90.50. Then it has to clear 92.73 which clears R1, R2 and the 10 DMA. Swing best
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)
*C Like on any OR provided it holds 56.40 for mini to swing
*CROX Over 15.50 clears the weekly moving average. Risk is to 15.20 day to mini. Any OR
CCL Good risk to today’s lows the 50 DMA. Over 47.75 a good shot this will continue as it is a 2015 pick-Any OR Swing
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:
MYL Last chance for this if holds the 50 DMA 71.48 and clears R1 72.82-on strength only for swing/mini
Phase Change:
GM If clears 35.87 that also clears the 50 DMA then can use a risk to the low of the day since it will have to confirm over the 50 DMA. Mini to swing Any OR
Reversal Trades: (Glass or Brick Wall Bottom or Top):
SCTY A Brick wall and phase change. If holds 54.00, like on any OR for a swing. The 200 DMA is 55.70 best risk for a quicker trade
Shorts: Waiting for new setups
Category 5:N/A
Category 6: N/A
Best Best wishes for your trading,
Michele Schneider
