I for one, am thankful for Thursday’s action, other than having to endure tweets by all the “smart” analysts who “knew” this was coming, even though most were merely “talking” the divergence train and not so clear about what it meant.
Of course, the doomsday folks had their day while the bulls (not sure there have been too many) had indigestion after Monday’s rally to new highs.
As for us here at Marketgauge, we fared well. Not short and yet, with all of our longs holding up, I particularly have no less than 7 fantastic trades in mind with now, a much lower risk.
These flushes typically yield opportunities. The only egg, (I’m vegan so let’s call it tofu), on my face to date relates to the interest rates. I don’t want to say I will be right about the bottom someday (after all, so is a broken clock right twice a day), but, I will be all over it the day the trend turns.
And trust me it will. Cycles-moon’s got ‘em, so does the market.
S&P 500 (SPY) Held the 50 DMA so that’s something for the analysts to muse over Subscribers: Negative Pivots in all
Russell 2000 (IWM) Nice turnaround from lows, but not enough unless it closes the week over the 200 DMA
Dow (DIA) Held the 50 DMA but if it breaks it end of week, then it will appear next move is more correction
Nasdaq (QQQ) Could still come back to life-really it could over today’s highs
XLF (Financials) 21.50 back in focus
SMH (Semiconductors) I’ll play over todays highs
IYT (Transportation) Orderly candle, good place to look if market firms
IBB (Biotechnology) Holding the 200 DMA at least
XRT (Retail) Ugly but into support
IYR (Real Estate) still looking okay into housing starts
ITB (US Home Construction) Interesting reversal candle-does somebody know something?
GLD If there were ever an ETF I would remove from my screen-however, at some point it will make some noise
OIH (Oil Services) Landed on the 50 DMA and oversold
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs Know what would make me so happy? A gap lower island top.
PHO (Power Shares Water Resources) Reversal candle perhaps-how can you bet against water?
EEM (Emerging Markets) Toppy candle
EWP (Spain) Subscribers: On the 50 DMA now
FCG (First Trust ISE Reserve NatGas) Oversold on the 50 DMA
SGG (Sugar) Subscribers: Held the 200 DMA
JO (Coffee) Subscribers: Watch what happens or for a confirmation on a quasi-island bottom
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:
MPW Over R1 looks good with 13.20 risk
CNX If holds 43.70 then clears R1 looks good especially over the 80 month moving average
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)
JBLU Held the 50 DMA and now, over R1 would get me back in-featured on calendar ranges.
MNST Inside day neutral pivots needs to clear 70.65 R1 and hold today’s low maybe more miniswing trade
Category 4: (Rip Tide) N/A
Phase Change:
PHM With housing starts. One push gets this back over the 50 DMA with a stop under todays lows
JCP reported well so if comes in over 9.50 worth a look
CIEN had a brick wall bottom and cleared the 10 DMA closing green. Over R1 tomorrow is good with risk to 18.00
GOOG Because of the slingshot low, over today’s high still good
NFLX I’d take a shot over today’s highs with risk to around 337
P Will be my first foray into last year’s fave if clears R1. Slingshot low, risk around today’s low
AMPE Love this one over 7.33 for swing with risk to 6.20 or so
WMT if this holds the 200 DMA at 76.37 over today’s high and gap could see a resumption of the move
Shorts: Rather sit aside now
Bye For Now!
