Good evening readers! You may address me tonight as Ms. Prudence as the “Sell in May, then walk away” believers who read last night’s daily hopefully heeded the warning of not banking too much on such hackneyed phrases. Naive or delusional are the folks who think that the market can be navigated by simply following such clichés. Oh, and have I mentioned “The Trend is Your Friend” lately? Indeed, as the S&P 500 once again, tops the charts with a new multi-year high close!
S&P 500 (SPY) 162 here we come? Of course unemployment numbers due first thing Friday will have some influence. Otherwise, 158.00 the new support to hold Subscribers: Pivots positive in all indexes
Russell 2000 (IWM) Unconfirmed phase change back to bullish as now 92.50 has to remain intact with a weekly close over 94.00, a really strong way to end the week.
Dow (DIA) Believe it or not, the April 15th high I have been mentioning a lot, has yet to be convincingly cleared on a closing basis. That’s huge for any precursors into the following week-can it or can it not?
NASDAQ 100 (QQQ) I started this week focused on this index as the one. Now, am ending the week making the bold statement that this index is just getting going
ETFs:
GLD Unless this makes a substantial gap lower, the return and hold over the 200 weekly moving average is positive
XLF (Financials) Inside day making the way the range breaks probably pretty decisive for looking ahead
IBB (Biotechnology) Still resting with 175 an area to get through
SMH (Semiconductors) “Oh sweet mystery of life at last I found you!”
XRT (Retail) Good comeback off of support. Consumer confidence high. Credit card companies prospering-new highs again possible
IYT (Transportation) 110 is key Subscribers: Watch today’s video
IYR (Real Estate) Nearly an inside day, but after doing its job helping get the market to these levels, for end of week, not expecting this to be the leader.
USO (US Oil Fund) ECB rate announcement helped pop this right back to the overhead 200 DMA.
OIH (Oil Services) Another push and this should continue moving up. Subscribers: Long today, but cautious until it busts away from the trendline shown on the video
XLE (Energy) 78.30 will break the pattern of lower highs since its peak
TBT (Ultrashort Lehman 20+ Year Treasuries) Inside day. One day the bond bubble will happen. Subscribers: R1 and today’s high line up.
XOP (Oil and Gas Exploration) Looks better away from the 200 DMA but needs a little more time Subscribers: Aside now
XHB (Homebuilders) 30.83 has to clear to negate the slingshot, but held support alright.
UUP (Dollar Bull) 22.58 the weekly number to clear for a major shift
SGG (Sugar ETF) Subscribers: Love the railroad tracks on the daily chart
FXI (China) Subscribers: Inside day as we sit long from 36.95-a week ago
RSX (Russia) Subscribers: Good day to get back in. We have no position now though
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
**NOTE: New and Old Subscribers: I do not include on the list 1. Anything with a weekly or daily RSI over 92 2. Anything within 4 days of reporting earnings 3. Anything with a risk over 1 ATR from its current close 4. Anything with only one day under the Floor Trader Pivots (unless specifically noted. 5. Anything with a potential slingshot or brick wall high (new 60 day high, close in the bottom 25% of the intraday range.)
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:
CROX Inside day. Still in ½ position and R1 and 15.98 Wednesday high line up
HOG 53.80 max risk now for a possible push over 54.50 and beyond
RL Reports May 22nd Like to see it hold 176.50, clear the FTP at 178 then, R1 and today’s high. 185 not out of the question
BAC R1 and today’s high has to break
NOW Inside day after a good correction. 38.65 good risk. Over R1 and today’s high, could continue.
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)
WLP Now a candidate for an ORR to control risk
NSC Improved in condition to a 1. 75.75 good support area to hold and over 77.00 move should resume with the 80.00 plus target
SPLK Has to clear 42.50 but would consider an ORR against 41.25 as well. Could see move to 45.00
CREE Improved back to condition 1. Inside day. Has to clear 56.44 and hold around 55.75
LEN Learn from this pick as it improved in condition on the day market dropped. Now, more of an ORR candidate to control risk
PCAR Wow. 50.00 a good pivotal area to watch for an ORR
Category 4: (Rip Tide) Oversold (2 or more days under FTP), Condition 4, Needs to clear R1, Risk previous day low unless noted differently, Target- Day to at least 3 ATRs from entry:
AWAY If holds 29.05, might be time to consider this for a bounce over today’s high and R1
Phase Change:
AEM Probed this today to see if it could clear 32.30 and exited to be prudent end of day since that area has to clear to confirm the glass bottom patterns. Held 31.95 so good tight risk.
IBM 202.59 now has to clear and 201 has to hold
AMZN Inside day and back over the 200 DMA with max risk 245.75.
Shorts:
Category 5: Titanic-N/A
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
CRM Reports May 13th. Inside day so has to break S1 and today’s low and not clear 42.19
Bye for Now!
