Many signs of a market holding its breath. First, logic-ahead of the FOMC and lots of economic data, important earnings yet to come out. Second, price-as in the indices didn’t do that much. Third, the volatility indicator-2 inside days in the VIX-a definite pause. Fourth, volume-the S&P 500 closed on new highs with light volume. When I can find four sound factors for the current pause in the current bull phase, typically I notch it up to a time rather than price correction.
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S&P 500 (SPY) Longer term we could be looking at a move to around 220. Unless we break April lows. Then all bets are off Subscribers: Positive pivots in all indices
Russell 2000 (IWM) 109.77 super important to hold now.
Dow (DIA) Unless this gets above 156.20 and then the top of a channel that goes back from May peak high, this could be merely a move to resistance and not much more. Too soon to say, but definitely worth noting if this begins to rollover
Nasdaq (QQQ) AAPL reported and at time of writing, had tested lower levels and was settling around the closing price of the session. QQQ had an inside day.
XLF (Financials) Inside day and still has not clear 20.88-to negate the topping candle
SMH (Semiconductors) Better, and now has the fast moving average to get through
IBB (Biotechnology) Digesting its recent move-all without getting to the all-time high
IYR (Real Estate) Failed the 200 DMA for an unconfirmed phase change to Recovery
XHB (Homebuilders) Digesting
GLD Subscribers: SLV Closed slightly under the 50 DMA-not concerning more stagnating-inside day
USO (US Oil Fund)Confirmed phase change to warning. Subscribers: P1 is 35.72
OIH (Oil Services)Has to clear the brick wall candle 49.78 to keep going
XOP (Oil and Gas Exploration) Inside day. Listless action but still in the game.
TBT (Ultrashort Lehman 20+ Year Treasuries) FOMC starts Tuesday
UUP (Dollar Bull) Maybe through 21.45 will reverse the downtrend
VNM (Vietnam) Subscribers: Like now over 19.15
VXX Subscribers: 2 inside days
URA (Global X Uranium) Subscribers: After a big day Friday, pause inside day and worth watching for a move over 15.08 if holds 14.51 the 10 DMA
FXI (China) Subscribers: Has to get back over the 200 DMA
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:
SLB Remained over the 10 DMA and now has to clear R1 93.29 hold 92.70ish
KORS Reports November 13th before open 75.94 is the 10 DMA and over R1 matches today’s high
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)
POST EARNINGS: MAS if gaps higher worth looking at especially if holds 21.30
QCOM Reports November 6th. Improved in condition. Like ifholds 68.00 and can see move to 70.00 next
TEX Over R1 no reason not to try this with a stop under today’s low
ZMH Big move last couple of days on good volume. If holds S1 86.65, then could have more upside here-close to the 2013 highs
C 50.43 is the 10 DMA and has to hold 49.95 area
GS Inside day slightly negative pivots with R1 and today’s high lining up and good risk under Friday’s low
FITB Inside day. Small stock over the 80 monthly moving average. Has to hold today’s low and really clear 19.22
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:
ADSK Reports November 14th. If 39.36 the 50 DMA holds, and it can get back over 40.00 worth another look.
Phase Change:
PETM Reports November 13th If holds S1-could take another look with the 50 DMA in mind as risk
AGO Reports November 7th. Long for a hybrid-taking some off at 1.5 ATRs and using S1 for stop tomorrow. Unconfirmed phase change back to accumulation
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
IBM If cant get over 178.21 then consider a short under OR low if risk is in line
Bye For Now
