According to the weekend analysis, the direction of the indices that the first 30 minutes of Monday’s session took, would establish the trend for the next couple of sessions thereafter.
All indices turned down and afforded a good short entry-but for what timeframe? After all, NASDAQ tested the 50 DMA coming back to close above it in spite of its red day. The Dow held the 50 DMA. IWM of course, had the worst day of the 4-proving out the theory of the phases where one should sell the weak and buy the strong. SPY never came close to the overhead 50 DMA and closed red, but held last Friday’s low.
Therefore, the foregone conclusion on which timeframe is best for now? Day to at most miniswing trades. This market is not a place I wish to commit to for much longer as it either roars, belly flops, or stands still in search of fresh news.
Overall, I can make the argument for lower prices in store. However, issue isby when? The market can have a rally, even a great one and still wind up down a lot by the end of the year. To put in another way, “Timing really is nearly everything. And what it isn’t, circumstance makes up for.” Steven Van Zandt
S&P 500 (SPY) 197.60 the 50 DMA which could not clear, yet close enough to give bulls hope Subscribers: Positive Pivots in DIA SPY Negative in IWMNeutral QQQs
Russell 2000 (IWM) Calling 108.80 pivotal with 110 the Holy Grail and under Monday’s low trouble
Dow (DIA) Winner for best shape, and best hope of holds around 169.50
Nasdaq (QQQ) 97.75-98.00 turned out as a pivotal area but marginally. Unless it clears convincingly from here, looks heavy
XLF (Financials) Held the fast moving average but looks like its backing away from the reversal top it had put in 9/19
SMH (Semiconductors) Had to prove itself today over 50 DMA and could not-wont dismiss that chance but for now, defensive
IYT (Transportation) Broke down under the 50 DMA for an unconfirmed warning phase
IBB (Biotechnology) Could not hold 272-hard to make a strong bullish case but does have the 50 DMA below
XRT (Retail) 50 DMA too much for it as it fell over 1%
IYR (Real Estate) An unchanged close doesn’t impress me although we can say its holding the 200 DMA
ITB (US Home Construction) Maybe double bottom-like to see even more evidence
GLD Typical this year to see this take out 2 year lows and then put in a possible bottoming reversal candle
USO (US Oil Fund) Back over 34.00 which means could hold and try for higher again
FCG (First Trust ISE Reserve NatGas) Subscribers: Really really oversold so will watch
TAN (Guggenheim Solar Energy) Good news is we will get a chance to buy it cheaper when it turns around
TBT (Ultrashort Lehman 20+ Year Treasuries) Rates continue to drop
UUP (Dollar Bull) Uh-oh, should have booked that trip to Europe on Friday-Monday this fell off but holding the fast moving average
IFN (India Fund Inc.) Subscribers: Holding the 50 DMA
EWW (Mexico) Subscribers: If holds today’s lows still worth watching
FXI (China Large Cap Fund) If holds Monday’s lows still worth watching
CORN (Corn) Subscribers: Woke up over the 10 DMA
BAL (Cotton) Subscribers: Touched the 50 DMA and still looking like its bottoming
SGG (Sugar) Subscribers: Cash has an unconfirmed phase change to recovery
JO (Coffee) Subscribers: Off she went
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: N/A
Category 2: 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)
ETR With ½ position like to add it back over 78.20 with new risk under 77.00
T Inside day-like if holds 35.30
CELG Sold off but has neutral pivots and held S1. 93.50 risk with a move over 94.65 better
HSP Top pick if holds 52.20
MJN 96.20 a good risk now on an ORR or move over 96.48
Category 4:N/A
Phase Change:
PM Over 84.95 will follow it with a risk to today’s low for a mini to swing trade
CCUR Confirmed recovery phase. 7.40 should hold now if this has a shot back to 8.00 and higher
HUN Confirmed phase change to warning with risk today’s lows-some resistance at 26.25 to clear
SWI-Like over 42.91 with risk to 42.10
LEN If holds 40.05 this too looks really interesting for a move to 43.00
SFM Probed this today but still friendly if holds 29.25 and clears 29.70 again Note: WFM over 50 DMA unconfirmed
Shorts: On Focus List: AAPL PX CBS TTM GME
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
AMZN Inside day. Under today’s lows with a risk to 323.50
WLL If cannot clear today’s highs, can drop down 10.00 if patient
EQT If cannot clear 91.26 still has lots of downside potential
SWKS 56.00 resistance with room to the downside to 43.00
Category 6:N/A
Best Best wishes for your trading,
Michele Schneider
