“So one thing you should know if you are a consistent reader, EVERYTHING needs confirmation with a second day. Tuesday action no exception. Both IWM and QQQs closed pretty much right on the fast moving averages. Recoverable if they can hold here and turn back up….Let’s look for Wednesdayconfirmation or no confirmation. The Indices, Semiconductors should be enough to look at.”
And those thoughts my friends, are the very reason I write this report daily-to keep you calm, clear and in full understanding of the rules of engagement or disengagement as it were!
When you stop and reflect on all the layers that go into the market, the one that fascinates me the most is thecollective consciousness or “herd” mentality. Why did Tuesday happen? Geopolitical jitters? Kind of legitimate. Or is that the stuff 2014 is made of? Just when you dance the new high dance, time to look around and see if you are dancing with yourself!
Market managed to gain back ½ of Tuesday’s losses with again some incredible winners such as Schlumberger, Google, Best Buy, Gannett Company and Sprouts, one our portfolio has been holding for 2 weeks now.
NASDAQ looks ready to put on its tap shoes again and the Russells, if holds 177.50, can dosey doe over 118.35. Otherwise, the rodeo stars are the stellar stock pickers who ride the one day wonders!
S&P 500 (SPY) Back over 195and now, really has to hold today’s low to make up what it lost on Tuesday Subscribers: Negative Pivots in all except QQQ
Russell 2000 (IWM) 117.50 we will call pivotal with over 118 better
Dow (DIA) 168 pivotal here
Nasdaq (QQQ) No doubt best looking of the bunch if holds today’s low and vote for most likely to get to new highs
XLF (Financials) Trying, we will give it that
KRE (Regional Banks) Actually, not a bad day for this one-with another push, good for tomorrow
SMH (Semiconductors) Can’t keep a good semi down
IBB (Biotechnology) Over today’s highs should be good again
XRT (Retail) Actually, since this never cleared the 2014 highs, could just need to do more work between 84.00 and 87.00
ITB (US Home Construction) Inside day so Thursday could be the best follow through for this
GLD In a holding pattern
USO (US Oil Fund) Since the runaway gap, been consolidating.
OIH (Oil Services) “Ugly looking but not dead yet” Let’s call it resurrection!
XLE (Energy) Another little resurrected sector
TAN (Guggenheim Solar Energy) Of course the spawn of XLE and SMH woke up as well
TBT (Ultrashort Lehman 20+ Year Treasuries) TLT a gap higher which means above 112.66 good
SGG (Sugar) Subscribers: Once more push gets this over the 200 DMA and this time, have to follow
JO (Coffee) Subscribers: Good close over 35.00
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) 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:
CSC 63.60 good risk and like ½ over 64.02 and other ½ over R1 64.20
PANW Over R1 80.53 also clears the 10 DMA and today’s highs for a miniswing
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)
NFLX Really, has to clear 450.82 but with good pivots, 438 or the 10 DMA worth watching
GMCR Held the 10 DMA but I would wait for 124 to clear
PLD We are in for 2/3 position now on what started as a miniswing now more hybrid swing
BIDU Spent hours consolidating between 182-184.50 so if that clears have your risk-under 182 miniswing
TSLA Over R1 239.54 good for day to miniswing if risk lines up
TXN Only a gap now over R1 48.58 would get me interested in a day to Miniswng trade
LEN Inside day-good for a day to mini if sets up
HD 80.85 clears 5 days of work-and an inside day
Category 4: (Rip Tide) N/A
Phase Change:
YELP Over Tuesday high 79.30 another one good for a day to miniswing
BAX Over the 50 DMA and still holding the gap from March. 73.50 a good risk point
JPM Like again over R1 57.89 which corresponds with our original entry and the stop now for a hybrid swing
YOKU Confirmed the recovery phase. S2 has to hold now and one more shot over 22 to add
KSU If today’s low holds, like for a miniswing over 107.64 and if good, we keep a tail over the 200 DMA
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
LMT Tried this for a daytrade and scratched, now let’s watch again against 163.11 R1
WMT Looking heavy here like it could see prices down to 72.00
Category 6: White Cap-N/A
Bye For Now!
