SPY after writing about the island top last night, a rumor driven and erratic market made way for an end of day sharp decline which not only gave SPY its third distribution day in a row, but also a failure of the 50 day moving. The 70 exponential moving average is now underlying support at 131.20. 130 is the area where the rally began from on June 29.
QQQ did have a distribution day in volume, and although the price is still above the 50 day moving average at 56.92, slope of the 50 DMA is declining. It was NASDAQ that tempered any excitement on the midday rally since it failed to not only take out its opening range high, but also the floor trader pivot which it is now has three days beneath. Therefore, either look to see what happens near the 50 day moving average; otherwise if it does manage to get through 57.68 the FTP and then 57.90, it's possible we will see a rally at the least up to 58.70.
IWM had a DOJI day near the lows of what looks like an interesting hammer candle. It is above the 50 day moving average still at 82. If this opens above the FTP at 83.14 and can take out R1 at 83.50 and today's high, could see a rally up to 84.50.
In all three indexes we are approaching oversold conditions on a short term RSI. A further correction close to any of these support areas mentioned above will look like a buy opportunity especially since the longer-term trend is still bullish.
Featured ETFS:
GLD All-time high at 153.61. 151.85 is now support. We have been long GLD since 148.50 in anticipation of it taking out recent highs to the next target 155.
UUP got long last week at 21.37 through options. Closed around unchanged. Has some resistance at 21.86, with the 200 day moving average overhead 22.15 now sloping upwards for the first time since last October.FXE underlying support at 138.45.
XLE**had a DOJI day near the lows and closed right on the 70 exponential moving average at 74.73. Although the 50 day moving average is still declining, the price has remained above keeping this in a bullish phase. Today's low 74.70 is now a good level of support and a decent risk should this come in above the FTP at 75.10 and take out R1 at 75.51. Has a gap to fill up to 76.08. OIH dropped right down to it is 50 day moving average now at 148.72. Also looking oversold and into key support.
XRT still has an upward sloping day moving average which is considerably far away from the current price. Tried to clear the FTP but fell with the pressure of the overall market. Now, another attempt over 54.55, with confirmation over R1 at 54.80, could see a move to 56.25 area.
SMH broke the 200 day moving average once again and is back in an unconfirmed distribution phase. Has underlying support at the 50 weekly moving average at 32.24 should it continue to decline. However, it is now looking oversold. A move above the FTP at 33.20 lines up with the 200 day moving average at 33.23. That will be a key component to how the rest of the market reacts.
Picks: All of the long picks are in a strong condition, have two or more days under the floor trader pivot and are close or above the 10 day moving average. Furthermore, they all held S1. Some have one or more inside days.
Longs: We are still mainly in cash with only the long calls in UUP and a long position from last week in GLD.
POT*now has two days under the floor trader pivot and held the 10 day moving average at 57.19. Above the FTP at 57.75, as described in today's video, can buy half an add over R1 at 58.48. Has to clear Friday's hi 59.44, and then the next swing high made in April 61.80. After that resistance at 63.97. Day to swing.
NOV**reports July 26. Never had an opening range breakout but held S1 on the close. Now a good wall of support at 76.00. Tomorrow the FTP is at 76.80 with R1 at 77.43. The 10 day moving average overhead is at 78.20, now point to clear. Last week, it made a high of 81.90. The multiyear high was made in April at 82.80. All-time high was made in 2008 and 92.70. Day to mini.
BBBY**has three days under the floor trader pivot and today's low held the 10 day moving average at 59.11. The FTP is at 59.37 and R1 at 59.62. The risk is 58.90. On the weekly chart has some resistance at 62.10. The projected move is to 65. Day to swing.
WYNN reports July 25. Has two inside days in a row and two days under the FTP. Would not risk more than to 154.50 but must clear 157.55 first and then today's high 159.50. Has resistance overhead at 161.74 hi from last week. Day to mini
CLF reports July 25. That too had two inside days in a row. Two days under the FTP so must clear 94.88 and then today's high 95.68. The 10 day moving average is below at 93.89, a good risk. If it can clear 97.50, it is possible if the market firms, that we could see a move before earnings up to 102.48 the old high. Day to mini.
RVBD reports July 19. Has two days under the FTP. Over 40.03, it also holds the 10 day moving average at 39.90 with today's low 39.29. If it can clear R1 at 40.77, we could see a nice pop at least up to the high from July 7 41.83 with more recent highs made in March the 44.70. Day to mini.
CVI**reports August 3. This has two days under the FTP, and held the 10 day moving average at 25.30 with today's low 25.25 a perfect risk. Over 25.71 is the FTP with good confirmation should it clear today's high 26.19. Multiyear high was made last week at 27.04 and above that last swing high in 2008 at 28.80. All-time high was also made in 2008 at 30.94. Day to swing.
DECK*reports July 27. Has two days under the FTP which comes in tomorrow at 92.65. The 10 day moving average is below at 90.89. Above today's high and R1 at 93.82, with a strong market, could see it run up to all-time high made in April at 97 and possibly beyond. Day to mini.
ANF** reports August 15. The 10 has not yet crossed above the 50 day moving average but, the price has traded above the 50 DMA for the last six trading days and the last two days, it has tested and held. 50 day moving average is at 70.91 with recent low at 70.90. Also, had an inside day today and three days beneath the FTP. Above 71.86 is the FTP a good place to buy half. If it clears today's high 72.79 has resistance at last week's high 74.93 and above that all-time highs made in early June at 77.65. Day to swing.
Hon. mention to AAPL which reports July 25 and also has two days under the FTP. Would like to see it hold 353.40.
Shorts: Many of the shorts that I have recommended more recently are now oversold from the last three days.
AAP had a death cross last month, and has been chopping around in the range between 60 and 56.50. Today, it had an inside day and failed the 10 day moving average at 58.55. If it breaks beneath the 10 day moving average and the FTP at 58.57, next support at 57.95. If it breaks 56.58 than it is possible can see a move down to 53.65 with better support down around 50.
WMS reports August 1. Broke down some time ago, but it's been holding above 27.80 on a closing basis. Has overhead resistance at the 10 day moving average 29.53. Had an inside day today. Beneath today's low 28.84 the recent intraday low is at 27.42.
ATI if this breaks the 200 day moving average at 59.85, next support is down at the 50 weekly moving average at 57.73. Reports July 26.
SOHU reports July 30. The 50 weekly moving average is at 73.11 under today's low. Has support at 72.10 the top of recent consolidation, but could easily drop back down to 64.77 the low made on June 24.
Goodnight!