Although I went away from the market for 7 trading days, it seems I’m looking right at the same prices (give or take) and the same analysis as though time did not pass at all.
Incidentally, thank you Mathew Mullins for filling in for me and making sure our readers continued to receive their daily email!
The notable features heading into this week:
S&P 500 (SPY) 183.40 the 50 DMA to watch. Over 187 a new ball game perhaps Subscribers: Negative pivots
Russell 2000 (IWM) 115.50 the 50 DMA to watch. Over 118.30 new life
Dow (DIA) 161 the 50 DMA but with a negative slope do not expect it to be major support
Nasdaq (QQQ) A close over 88.40 will reverse the unconfirmed phase change. Otherwise, March came in like a lamb but could be going out like a lion
XLF (Financials) 22.17 the fast moving average. Still in play if holds up
SMH (Semiconductors) 44.50 the fast moving average. Still in play if holds up
IYT (Transportation) Outperformed and could still head higher if clears Monday’s highs
IBB (Biotechnology) Not quite oversold but rallies should be met with selling
XRT (Retail) Without retail, market will have issues. 83.30 key support
IYR (Real Estate) 67.00 is the weekly moving average and ultimately the place to defend by the end of this week
XHB (Homebuilders) Not pretty but now a bit overdone
GLD If this cannot hold 125.50 to 125.00 not a good sign
USO (US Oil Fund) Some will see an inside day and some will see more toppiness. The 50 DMA is last support to hold if good
XOP (Oil and Gas Exploration) Holding the 10 DMA. 69.30 should hold. Looks great over 71.27.
TBT (Ultrashort Lehman 20+ Year Treasuries) new lows
EEM (Emerging Markets) Subscribers: Inside day-we covered half as short getting stale
FXI (China Large Cap Fund) Subscribers: Have tiny long on the Opening Range Reversal and would only add if clears the 50 DMA 34.82
CORN (Corn) Subscribers: Nice move up today-Like to see 33.00 hold 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
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:
SLCA If holds today’s low and clears 36.58 looks good on longer term charts
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)
TEX Inside day but note pivots are slightly negative so has to cross R1 43.78
JNJ Inside day and has to hold 93.96 clear 95.93
OC Cleared R1 and the 10 DMA with good risk to under Friday’s low-watch for a reversal or breakout
Category 4: (Rip Tide) N/A
Phase Change:
AAPL Over 539.66 especially on a closing basis looks good
DRI Like this since the end of day comeback gave it an inside day and held the 200 DMA
JCP Inside day-like it if holds 8.12 and clears 8.67
SODA Like this too if holds 41.07
KSS Inside day but really to get me interested it has to end the day over 56.00
SCTY Closed marginally as a slingshot low and over R1 and today’s high not a bad trade for bounce to at least the 50 DMA
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
TWC If cannot clear 138.41 and breaks the 50 DMA 137.33 then could see move lower to 124 area
MA 78.02 is the resistance this cannot cross
CTRX Broken down so if risk is inline, 46.29 max risk, then still has lots of room on downside
Bye For Now!
