Although I always get a little antsy when the indexes take out key resistance points then close below them after a strong up day, I also know that a move in the direction of the trend, is a good thing. I also know that the nature of this market has been sector rotation for quite some time. Like musical chairs, when the music stops, you want to be in a chair and not standing up sans seat. Furthermore, a professional portfolio is diversified enough that the ebb and flow of sector rotation keeps you solvent. For example, Transportation has been a hot sector since early December and I made no bones about how much I loved it. Then, at the same time I began to point out Semiconductors. Technology (including Biotechnology), which was hot in 2012, has cooled. And so forth and so on.
S&P 500 (SPY) 148.11 was last swing and 2012 high. Today, it ran through it, closed below. Concerned? Only if 146.20 gets violated. Subs: Pivots Positive
Russell 2000 (IWM) Small caps have led-still do and not overbought. Not seeing any concerns here Subs: Pivots Positive
Dow (DIA) 136.48 the 2012 high here. Also not overbought Subs: Pivots Positive
NASDAQ 100 (QQQ) 70.58 is the 2012 high-not even a factor yet. 67.34 was 2013 high which it cleared today then closed above. I would tend to notch that up to AAPL, GOOG-both of which report next week. Until that dust settles, hard to predict. Subs: Pivots Positive
ETFs:
GLD Touched the 50 DMA and retreated.
XLF (Financials) Still holding the fast moving average with 17.20 the 2011 high and 20 the ultimate target.
IBB (Biotechnology) A bit toppy now
SMH (Semiconductors) Bullish phase. Cleared 34.00 which now should hold. Then, 2012 high 36.17
XRT (Retail) 65.47 the 2012 high. Today got real close. Now that it is overbought, even a move to 64.00 would be a healthy correction to see if this can power through those highs
IYT (Transportation) 101.60 the 2011 high. Today's high 101.34. I am happy to see my first big target met and wouldn't mind some correction from here
IYR (Real Estate) Not as excited about this group as I was in 2012.
USO (US Oil Fund) Resistance at 35.00 and if good, should clear. Subs: Slingshot high possible if follows through.
OIH (Oil Services) Subs: Golden cross today. That would lead me to believe that dips are buy opportunities now, which is a shift from 2012.
XLE (Energy) 75.19 last swing high, then 77.35 the 2012 high. Like to see today's gap low hold
TBT (Ultrashort Lehman 20+ Year Treasuries) The start of the "bond" bubble? If 65.00 holds, could very well be.
DVY (Select Dividend Index) Friendly to this as well
XOP (Oil and Gas Exploration) Looking for 60.00
XHB (Homebuilders) Busted out of its sideways consolidation
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.
*Note: US Stock Market is closed on Monday. Tomorrow is options expiration. Could be choppy and relatively quiet.
Category 1: (Aloha) 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)
A Great move today off of an opening range reversal (featured on today's video). Now, have to control the risk for a new entry. But support at 43.20
TSO* Inside day which makes today's low a good risk
TRIP 44.20 is the 10 DMA. This has been choppy-consolidation with huge support now at 43.35
LNKD* Reports 1/31. Has to clear 120 to see 125 and hold 116.
EOG Now needs to clear 126.45 and hold 125.35
USG* 30.00 is resistance, but now has to hold 29.00
VHC Inside day and holding the 50 DMA at 32.60. Like to see it clear today's high
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:
BZH Oversold and holding a gap from 01/02. Inside day
Phase Change: BYD Held the 200 DMA. Let's see if this can clear the 10 DMA next at 6.83. CNX If this cannot clear 30.88 not a clean slingshot pattern off the lows PM Another great OR Reversal to breakout. Now has to clear 90.00 TSL Small stock with inside day. Like over 5.34 if 4.96 holds CLH Unconfirmed phase change to recovery. Stopped at the 200 DMA. If can hold around 55.90 worth looking for a reversal
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
WPI Negative pivots and under the 50 DMA. 84.18 is S1 to break and should not clear 85.00
SINA Back under the 200 DMA. 54.30 area a good risk.
Bye for Now!
