If you stayed one step ahead during Thursday’s session, most likely you stood on the sidelines and watched the digestion at these levels. Except in NASDAQ, this digested while making new highs. That brings me comfort even though there are always many slices to the pie. One, there is the plaguing 2013 highs yet to be penetrated in both the retail and financials groups (The ETFs). Second, there is the small rise in rates as the TLTs closed shy of an improved phase. That could be conceived as a letdown after the FED announcement. Certainly makes it an area to keep very close eyes on as the week ends. The Dow and the small caps had inside days near the new highs established yesterday. Mixed bag and very interesting indeed!
S&P 500 (SPY) Made new highs by a couple of ticks and closed down ever so slightly. Wednesday’s low now important Subscribers: positive pivots in all indexes
Russell 2000 (IWM) Inside day and not overbought
Dow (DIA) 156.24 the old 2013 high holding with Thursday’s inside day. Good pivotal point
Nasdaq (QQQ) New high or shooting star? Another question in the drama of the first post-FED day.
ETFs:
XLF (Financials) Still has not gotten to the 2013 high from July-20.93
XRT (Retail) Also has to clear 2013 highs 83.24-and my bet as the best one to do it if market holds
IYT (Transportation) New highs-no more double bottom fears and another place to look for opportunities longer term.
IYR (Real Estate) confirmed phase change to recovery. Like to see some digestion against the 50 DMA now and then see if it can blast through the 200 DMA
XHB (Homebuilders) Not new 2013 highs yet
GLD130 back to pivotal
USO (US Oil Fund)Inside day and sell off but managed to confirm phase change to bullish
OIH (Oil Services)Inside day
XLE (Energy) Digestion day here
TBT (Ultrashort Lehman 20+ Year Treasuries)Inside day. TLTs Got right to the 50 DMA. 104 pivotal and above the 50 DMA might see more upside
UUP (Dollar Bull) Subscribers: Note the 2013 low 21.53
EWG (Germany) Subscribers: Elections next week
FXI (China) Subscribers: Guess what’s getting close to the 80 monthly moving average?
SGG (Sugar) Subscribers: Looking like an inverted head and shoulders bottom in place. Now, the fun should begin.
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 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)
F Inside day. If this clears 17.77 could go to 25.00-26.00. And really, want to see it hold 17.50 now
RHT Although it backed off from new highs, made a new high close. 51.90 good area to hold now
OI Of interest because of the 80 monthly. 30.89 is S1 and good near-term support
JBL Improved condition and holding the 10 DMA tight risk to S1 23.53. Over the 80 monthly now too
PETM Getting a bit overdone near resistance at 74.40, but overall chart still looks good
MDVN Improved in condition. 59.86 and the 10 DMA good areas to hold now, 61.50 eventually has to clear
GILD Missed the opening range reversal here. New high close so continue to watch it hold 64.00
TRIP What interests me is the compression since early August which could mean there is a good options straddle or strangle to trade. Will price tomorrow
Category 4: (Rip Tide) N/A
Phase Change:
CAR Corrected to the 50 and 10 DMAs. If today’s low holds, like this over today’s high and R1
FSLR Really needs to clear 40.00 for real
KSS Has upside resistance to clear over 53.32 but for now, as long as it holds 52.00 looks ok still
Shorts: We have a couple on the focus list that might setup but not real clear yet
Bye For Now
