In spite of the fact that all the indexes remain in warning phases, even the small caps (Russell 2000), at least got closer to the 50 DMA after the poorer than expected GDP. Since so much of the market is perception and psychology, with the GDP numbers, the market reacted to what the FEDhas already said-no easing if the economy doesn’t continue to improve. So, the economy shows slower than expected growth and everyone gets happy. Did I use the word “perverse” this week? Anyway, not sure about this perception since the dollar rose again and rates improved but certainly not to euphoric proportions. Gold certainly is the new scourge of the markets. Social media the new darlings-especially Pandora and Yelp. Retail and Financial sectors went back tounconfirmed bullish phases-a positive. But the market, even after today, is far from the peak high in May. It needs a whole lot more bad news to be good.
S&P 500 (SPY)Under today’s low, would look like 3 days up to resistance, then breakdown again. Otherwise, the 50 DMA is still there for the taking Subscribers: 3 days up and possible we could see the 50 DMA. Equally possible this could be a white cap in the making if breaks S1.
Russell 2000 (IWM) Tried so very hard, but failed to close above the 50 DMA. Tuesday I wrote it better happen sooner rather than later. Like tomorrow or else
Dow (DIA) A move over 150 or so would be encouraging
NASDAQ 100 (QQQ)Would consider 70.00 pivotal here-like it above, not so much below.
ETFs:
XLF (Financials)Unconfirmed bullish phase and looking out, for the month, a close over 19.20 is key
SMH (Semiconductors) 37.60 is important on a lot of levels-it keeps the recent channel breakout on the monthly charts intact and it crossed the 50 DMA. So, if this cannot get and stay there, vulnerable
XRT (Retail) Unconfirmed bullish phase making today’s low real important
IYT (Transportation) 108.20-108.65 an area to hold. And of course, the 50 DMA is the area to clear
IBB (Biotechnology) Like everything, good day but needs more
IYR (Real Estate)Here is where I would look for a short if the market comes off-been weak, still weak.
XHB (Homebuilders) Under 28.00 next time, see 26.00. Otherwise, this has to clear 29.50
GLD115 the eventual target
USO (US Oil Fund)My first instinct this week was to stand aside-I didn’t listen to myself as the phases are changing rapidly around these converging moving averages. Now, I know that once the moving averages separate from one another, the next move will be way more obvious.
OIH (Oil Services)Until this closes a month out over 43.80, not really all that interesting to me.
XOP (Oil and Gas Exploration) Under the 200 DMA could see 55.00. A weekly close over 59.00 much more encouraging
TBT (Ultrashort Lehman 20+ Year Treasuries) Fresh look for a buy opportunity against 74.00 risk
UUP (Dollar Bull) Cleared the 50 DMA for an unconfirmed bullish phase
SGG (Sugar) The futures cleared the 50 DMA but not this. We bought ½ position until it does.
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 caneither 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)
LNC Wasn’t as exciting as some of the picks, but with the opening range reversal, it cleared past the 10 DMA and now, considering its over the 80 monthly, one more push a good thing
GCI Will look to add to original long entry on an opening range reversal or breakout over the 10 DMA
DISH Ultimately has to clear 41.00, but for now, has to also hold today’s low
CBI Improved in condition. Tight risk to today’s low now
MET Had a good opening range reversal. Now, a breakout over the 30 minute opening range would be ok to follow as well.
MBI Unconfirmed bullish phase and touching the trendline I showed on today’s video. The 50 DMA now support to hold
Category 4: (Rip Tide) N/A
Phase Change:
CRM Inside day. New stop under Tuesday low and over Tuesday high looks good to next resistance 39 and maybe beyond
LNKD Phase change to unconfirmed bullish. Like a reversal or breakout if it holds the 50 DMA
GE closed back in a confirmed bullish phase. Really, with the brick wall, has to clear 23.70
OSK On list since it is over the 80 monthly. Now, has to hold 36.00, closest risk
ISRG Wild and thin but definitely worth watching for a possible basing action then move over the 200 DMA
Shorts: Even though the market seems vulnerable, the stocks that have been already beaten up have really oversold RSIs on the weekly charts and are more setup for max, a daytrade.
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
SLB Started a swing trade short. Risk 23.01 and now will add under today’s lows
WLL 2 inside days. Like under today’s low, thinking this one eventually breaks the 80 monthly moving average
Category 6: White Cap-Having a 2-3 Day correction over the pivots. In a Negative Phase, Positive Pivots. Can sell an Opening Range High Failure if happens below R1 or previous day high whatever is higher and/or weakness if breaks S1 and prior day’s lows
BXP 104.90 a good risk, and has to break today’s low and S1. If this breaks 100, very dismal
CHRW Marginally a white cap. But, definitely a good setup under S1. With risk to today’s high
Bye for Now!
