The market took a giant pause-ok-poetic license-with inside days (when the range of the day is literally inside the range of the day prior) in the S&P 500, NASDAQ and Russell 2000s. The Dow nearly had one, but took out Monday’s highs by a few cents midday then retreated. In other words, the market did exactly as one would expect the day before the ever so important-as if they all haven’t been-FED policy meeting. One can easily deduce from this week’s strong action and impressive comeback from the near abyss that many predicted would happen after Monday’s sell off in NASDAQ-that the market anticipates perhaps some easing of bond buying, but nothing too catastrophic. Take it away BB and the band-we’re in your hands!
S&P 500 (SPY) Inside day low volume after gap higher Monday. OOHHH a perfect storm either waySubscribers: positive pivots in all indexes
Russell 2000 (IWM) Even more perfect-an inside day near the new highs!
Dow (DIA) Not as perfect, but still quite clear on what to do considering the gap higher Monday, tight trading range Tuesday.
Nasdaq (QQQ) Inside day and not as nasty looking anymore
ETFs:
XLF (Financials) Confirmed phase change back to bullish provided the 50 DMA holds up
SMH (Semiconductors) New high close for 2013 again-Semis-yay!! Texas Instruments is trading higher than it has since May 2001!
XRT (Retail) Pulling away from the 50 DMA
IYT (Transportation) Possible double top-but only a possibility at this point-big earnings tomorrow before the open in Federal Express.
IBB (Biotechnology) Then there’s this-yet another new high close
IYR (Real Estate) Inside day. Has a chance to clear the 50 DMA. Rates will impact this for sure
XHB (Homebuilders) 30.00 would be good to hold
GLDWith all its pressure, the island bottom from June remains intact
USO (US Oil Fund) Unconfirmed phase change to warning
OIH (Oil Services)Steadily rising
XLE (Energy) Inside day with 84.00 pivotal
XOP (Oil and Gas Exploration) Nasty reversal nada mas-now looking real strong
TBT (Ultrashort Lehman 20+ Year Treasuries) Drum roll please..
SGG (Sugar) Subscribers: Got the correction I waited for. Now, will jump in on signs of strength against the 50 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)N/A
Category 2: (Pipeline) N/A
Category 3: (Double Up) Positive Phase, Condition 1 through 4, Positive Pivots which means can eitherbuy 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)
MAS Only logical risk is Monday’s low and over 21.65 still looks good
GMCR Inside day and may finally be ready to party!. 84.68 the 10 DMA to hold and should clear 86.75
YY Inside day with today’s low on the 10 DMA as risk. As a relatively new stock, in uncharted territory
CSIQ Slightly negative pivots.13.97 should hold with now 3 months holding the 80 monthly moving average.Like to see 14.60 clear
CHKP Inside day. Really needs to clear 59 and hold 57.60-if does, has room to 61.50 or better
F Inside day.If this clears 17.70 could go to 25.00-26.00. Risk is now 17.20
COST Missed having 2 inside days marginally> Looks good provided 116.30 holds
MAR 43.01 good risk now after an inside day. Trade is for new highs.
CTRX Improved in condition and an inside day. Only give this a little room to the 50 DMA 54.07
OI Inside day.31.00 key. Today’s low good risk
Category 4: (Rip Tide) N/A
Phase Change:
C Inside day with the 10 DMA pushing up towards the 50 DMA indicating forward momentum. Risk is the 50 DMA
USG Unconfirmed phase change to accumulation. Risk now the 200 DMA and look for more upside
X As long as this holds the 200 DMA, still is in gear for more potential upside
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
BID Not a bear phase, inside day and under Monday’s low could see move down to the 50 DMA
MPC Today’s high now max risk
Bye For Now
