Mom, What's Normal? Just a Setting On The Dryer, Honey
I’m a relationship type of girl. Once you’re in good favor, I will do whatever I can to help you be the best version of yourself, loyal and protective.
Screw with me, and I will offer you the chance to explain yourself, accept an apology and forgive. But, if you instead become belligerent, dismissive or worse, abusive and uncommunicative, forget it-you’re toast!
I have advised specifically about stocks as well as traded throughout the Bull Run beginning at its nadir in March 2009. One could say I am in a long-term relationship with the Bull Market.
Throughout the last 6 years, we have had our issues-the market and I. However, there were always ample explanations and forgiveness after the nastiness. In fact, as the good friend the Bull Run has been, he/she has served up many new and better opportunities soon after we have had a good rout.
In former dailies, I have talked about the seven year itch. That’s fairly typical in a lot of relationships and certainly a perfectly reasonable explanation for the new personality trait the market has exhibited thus far in 2015-the stubborn trading range.
Is stubborn a deal breaker? Just as the bear market ended dramatically in spring 2009, it does stand to reason that the bull market since 2009 needs some equally if not more dramatic conclusion before I send him/her packing! Stubborn is annoying, but only dramatic if you allow that behavior to get to you. And should it get to us?
On the one hand, the market seems to absorb pretty much everything negative or that perceived as such and hence, continues to hold near the highs. On the other hand, it stalls near the highs, taunting one’s loyalty instead of rewarding it. Some would say that suggests it’s just waiting to crash.
To date, I remain in the former camp-you (market) had me at the bottom in 2009 and although I am more incredulous now than ever, you still have me. And why?
My Economic Modern Family. Regional Banks (KRE) made new 2015 highs on Tuesday. The Russell 2000s (IWM) as long as it trades above 120, keeps faith alive. ForRetail (XRT), I remain true provided it continues to close above 97.00.
Semiconductors and Biotechnology both have been up and down their 50 DMAs and thus far, spring into action just when they need to. Both are in bullish phases.
Transportation (IYT), the black sheep, well that one is about to send us into family counseling, but we’re at least optimistic provided it hangs on to 152.
My next daily, I will reiterate the 3 signs of a top I have posted several times throughout the years. Top is relative of course, but after 5 plus months of stubborn behavior, I would imagine the top, should it materialize, could be substantial.
In the meantime, my loyalty settles for less than perfection and makes allowances for weaknesses. However, hear me loud-true loyalty takes years to build and only seconds to destroy!
S&P 500 (SPY) Closed just shy of the interim support at 210-a good start above on Wednesday would be a positive. Otherwise, watching the 207 area.Subscribers: Negative Pivots in all
Russell 2000 (IWM) 120-123.85 range within the range
Dow (DIA) If this can clear 180.88 early on and hold, good. If not, 178.50 most likely
Nasdaq (QQQ) 108 pivotal
XLF (Financials) 24.24 key support
KRE (Regional Banks) New 2015 high
SMH (Semiconductors) 55.00 support and through 56.80 good
IBB (Biotechnology) 350 pivotal
XRT (Retail) Over 99.65 clears the 50 DMA
IYR (Real Estate) Held recent lows as rates eased some
ITB (US Home Construction) Has to clear 27.30 to be good
GLD (Gold Trust) That negative slope in the 50 DMA has prevented us from even looking at trading this right now
GDX (Gold Miners) Good day if holds now over 20.00
USO (US Oil Fund) Looks good longer term
XOP (Oil and Gas Exploration) Tested and held the 50 DMA followed with an inside day.
UNG (US NatGas Fund) First close over the 100 DMA since last November
TAN (Guggenheim Solar Energy) long term bullish
TBT (Ultrashort Lehman 20+ Year Treasuries) Held the 200 DMA confirming the accumulation phase
EEM (Emerging Markets) Monthly chart has huge consolidation going back to 2011
EWP (Spain) Starting to look better longer term with 2 inside days which will make a move over 36.20 compelling
EWY (South Korea) This would be a good place for this to hold-Tuesday’s lows
CORN (Corn) Like over 23.40
SGG (Sugar) Looks like bottom is in place
PHO (Water) Mad Max needs water-Coming to a theater near you!
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 Neutral, Intermediate-Term Positive 4, andLong-Term Positive 9, aggregate makes it a positive 13. Same as Monday.NOTE: Market Tone is updated before the open each day and reported to you on twitter.
Category 1: N/A
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:
ADI Touched and held the 50 DMA. Risk is to 61.40 and has to clear 62.50 R1 And the 10 DMA. Look at for 5 or 30 minute ORs also can do ½ over pivots ½ over R1
PNRA Over R1 clears the 10 DMA with a risk to 180 still intact for a swing. Like on a 5 or 30 minute OR
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)
DE Although it has negative pivots, it held S1 and the 10 DMA. Like over 90.42 the pivots and over today’s high clears R1. Risk is to 88.90 mini to swing.
CIEN Also negative pivots but like for a miniswing max risk to pivots only 21.90 if clears R1 22.24 OR-5 or 30 Minute
Category 4:N/A
Phase Change:
CCUR On the list for a 2105 pick since been a takeover candidate for some time and is over the 80 month moving average. Cleared 3 moving averages with double the normal range and good volume. 6.21 bottom line risk and would look at an ORR if sets up
DECK Reports 5/28 Max risk 74.30 like over 75.73 for mini to swing. Good for a 5 or 30 min OR
Reversal Trades:N/A
Shorts: No real great short setups
Category 5: N/A
Category 6: N/A
Best Best wishes for your trading,
Michele Schneider
