The big news for Thursday-relatively-are the small caps comeback,outperforming the rest of the indices percentagewise! However, before we get too excited, that range established over the last two weeks remains solidly there with NASDAQ now posting two inside days.
The Dow posted an inside day as well. Therefore, this whole trading range thing which I’m sure is boring the heck out of my readers, is actually becoming super exciting to me. The longer the range lasts, the more explosive the move is after the range breaks up or down!
Our portfolio also prospered today with the move in the Regional Banks ETF (KRE), which leads me to repeat the information I have been tracking on interest rates and the now confirmed warning phase in the Long Bonds (TLTs).
With some other interesting moves-such as the possible reversal off the lows in oil, natural gas and gold miners, one does wonder whether they are all doing the dead cat bounce thing, or anticipating a move by the Federal Reserve next week capping the recent buzz about the rise of the rates. Or perhaps, these commodity related instruments like the strong dollar and higher rates after all. Time will tell. Never forget the tried and true risk/reward parameterswhen dipping in your toes long or short.
Finally, a solemn remembrance of 13 years ago. Our workplace for 15 years, the World Trade Center and the tragedy of the friends we lost will stay forever in our hearts and minds!
S&P 500 (SPY) Gonna repeat, 200 pivotal over 200.70 good but it’s the top of the range that counts most Subscribers: Positive Pivots in all except DIA slightly negative
Russell 2000 (IWM) This holds so much better overall! 115 key support
Dow (DIA) Inside day. 170.83 has to clear 170 pivotal
Nasdaq (QQQ) 2 Inside days! Definitely watch this range break
XLF (Financials) Range bound but solid
KRE (Regional Banks) Yay! Not far from our first target
SMH (Semiconductors) The 2014 leader on a rest which is just fine
IYT (Transportation) Strong day
IBB (Biotechnology) Inside day
XRT (Retail) Retail Sales out Friday but good day in the ETF
IYR (Real Estate) Tested and held the 50 DMA
ITB (US Home Construction) In a tight range making this worth a watch for a break either way
Metals and Mining (XME) What an instrument can do when oversold and sitting on a major moving average-has to confirm a bottom now
USO (US Oil Fund) Possible reversal candle
OIH (Oil Services) Confirmed a bottoming candle if now holds 51.97
XLE (Energy) Same as OIH with support at 93.81
XOP (Oil and Gas Exploration) Confirmed reversal candle provided the 200 DMA holds
FCG (First Trust ISE Reserve NatGas) Subscribers: A push over 19.88 looks good
TAN (Guggenheim Solar Energy) Subscribers: If holds 45 we have a good place to have a shorter term risk from
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs confirmed warning phase
BAL (Cotton) Subscribers: Confirmed recovery phase and now has to clear 45.98
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:
INTC 34.40 a base to risk from if clears R1 35.18 or about a swing risk
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)
SCTY 69.85 risk with R1 72.07. Pivots positive so candidate for an ORR as well.
SWK Over 92.49 clears 4 days of work with risk under 91.33
NFLX 2 Inside days now with neutral pivots so over R1 and todays’ high line up
RHT 61.10 support and over 62.00 has room for a day to miniswing
KSS A weekly close over 60 looks great and can watch for an ORR for a day trade
WHR Inside day and like for day to mini if holds 152.80 and clears 153.74
Category 4: N/A
Phase Change:
RPTP Not really my kind of trade, but now, with the 200 DMA at 11.57 worth noting for a day to swing trade with risk to low of day if clears
PM The 50 DMA is 84.66 and now, it has to hold 84.06-still like for swing
CBST Over 69.14 clears the 200 DMA with a risk to whatever the low is should that happen
DDD Inside day right on the 50 DMA making this a good risk to 52.30 if clears 53.70
PXD Upgraded today-now look for an ORR against 198.16
Shorts: Nothing great but do have MAN BMY V on focus list
Category 5: N/A
Category 6: N/A
Best Best wishes for your trading,
Michele Schneider
