SPY came back above the 50 day moving average which is still sloping down, and closed right on the floor trader pivot at 131.85. There was no distinguishing volume pattern. Early in the day it tried to get through the high from two days ago 133.18 with today's high 133.22 before the afternoon reversal. However, at this point, it is now not only holding the 50 day moving average but also the previous day low at 131.36. If it breaks 131.23, the exponential moving average, then anticipate a move back down to 130. Otherwise, back above 132.20, the FTP which is positively stacked tomorrow, and the trend at least for the time being remains intact.
QQQ opened for two days at 57.94 and then failed attempts at higher levels by the end of the day. Tomorrow, with positive pivots, a move above 57.94 clears the FTP, the opening range level for the last two days, and the 10 day moving average. Would take a break of 57.40 as an indication we will see a move down to the 50 day moving average at 56.90 and a hold above 57.94 as an indication that we will try the resistance at 58.70.
IWM after that interesting hammer candle yesterday, was the only one of the three indexes to have an accumulation day in volume. And unlike both QQQ and SPY, did not make new lows at the end of the day. If it holds today's low 83.22, and gets through the 10 day moving average at 83.80 especially on a closing basis, still has to clear 84.50 but will look like the mid-caps could once again take the lead.
Until the United States Government and the Federal Reserve come to decision and resolution, expect volatility. With so much divergence and nervousness in the market, one either has to stick to daytrading or swing trading with wide parameters and conviction.
Featured ETFS:
GLD new highs. Since it got so close to our target of 155, a conservative stop is now under S1 which comes in tomorrow at 153.55.
UUP got long last week at 21.37 through options. Today it tested the 10 and 50 day moving averages and filled the gap that was left from two days ago. Sold half our long calls on the lower open and will watch 21.34 to hold.
IYR never followed the rest of the market and closed below yesterday's level. Has negative pivots tomorrow. Also had a bearish engulfing pattern on low volume. If it clears 61.50, especially on a closing basis it will negate the bearish engulfing. Otherwise, the 50 day moving average which is now slightly negative in slope will be the next support around 60.75.
XRT held the 10 day moving average now at 54.62. Had a DOJI day which makes 54.79 the first pivotal area to hold with a move back above the FTP at 54.96 a good indication of strength.
IBB now must hold today's low 107.88. With a neutral slope on the 50 day moving average, back above 108.50, the FTP another good sign of strength.
SMH now has confirmed back into a distribution phase. As I have written many times in the past, until the semiconductors join the party, it is hard to maintain a long-term bullish view in spite of how the weekly and monthly charts look in the indexes. Now, SMH is oversold on the two day RSI. The 50 weekly moving average comes in at 32.24 with a recent swing low in June at 32.15. That is the last area of support that would give this some promise of a turnaround. Otherwise, a test of the 30 area very likely.
XLF the other party pooper. Closed unchanged, but under 14.90 there is that recent support at 14.62. A break of that area and we could see 13.85. Only hope is a move and close back above 15.50 on a weekly basis.
Picks: Any of the pics from yesterday that are holding key moving averages and have an opening range reversal tomorrow will most likely be your lowest risk trades such as ANF, DECK, XLE XRT AAPL. Especially if the picks have positive pivots. I will be carefully watching the indexes and XRT XLE for OR high and low reversals as well. For obvious reasons, reluctant to buy anything on strength.
Longs: We are still mainly in cash with only the 1/2 the long calls in UUP, a long position from last week inGLD and a small position in KLAC.
POT*had a DOJI day, the pivotal area now 58.15. Although it had an opening range breakout this morning, like so many others, it sold off at the end of the day. Now, with positive pivots, if it gets above 58.33 the FTP, has support at 57.51, the 10 day moving average. This might be one to look for an opening range reversal buy. Must get above 59.44 to stay strong. Then the next swing high is 61.80. After that resistance at 63.97. Day to swing.
BBBY* had an opening range reversal at the end of the day. Now, if it holds the 10 day moving average of 59.25 and gets back above the positive pivots at 59.54, above today's high 59.93, clears the last three days of consolidation. On the weekly chart has some resistance at 62.10. The projected move is to 65. Day to swing.
RVBD reports July 19. Now three days under the FTP which is positive tomorrow at 40.12 which is also where the 10 day moving average is. Worth a shot above that level with either a risk to today's low 39.80 or yesterdays 39.29. The high from July 7 was asked 41.83 with more recent highs made in March the 44.70. Day to mini.
YOKU two inside days in a row. Reports August 5. Has near-term support at 35, with three days under the floor trader pivot and a positive stack tomorrow with the FTP coming in at 36.16. Can buy above the FTP with a choice of risks. Swing under 35, mini swing and/or day trade under today's low 35.58. Took one shot at the exponential moving averages overhead 39.75. If clears, possible move to 50. Day to swing.
KLAC featured on today's video. Reports July 28. Cleared the convergence of all of the moving averages with only the 70 exponential moving average left at 41.76. The pivots are now positive and the FTP comes in at 41.69. Most clear R1 and today's high 42.31 to look really strong. Next resistance is at 43.81. Risk right now under today's low 41.11. Day to mini.
Shorts: AAP turned out to be an incredible short breaking down under the five-minute opening range low and closing on the lows. WMS had an opening range high failure and closed near the lows.
STI reports July 22. Recent low is 24.63, next support at 23.25 better support at 22. Day to mini
PAY** Caught the rally in this up to the 50 day moving average a couple of weeks ago and now have been aside. Since it failed to get through the 50 and is now testing the 200 day moving average, with negative pivots a break beneath 42.77 corresponds with a break under the 200 DMA. The risk is to today's high 43.35. There is support on the weekly chart at 40. Day to mini
APKT reports July 21. Had an inside day today. With negative pivots coming in at 67.41, if it breaks beneath yesterday's low 67.78 can use the FTP as a risk in anticipation of support at 64.40, the exponential moving average. Better support at the 200 day moving average 61.26. Day to mini.
AKAM reports July 27. The 200 weekly moving average is at 30.62. Has positive pivots, so if it breaks the 200 would not risk more than to above 31.13. This week's low so far has been 30.52, under there support at 29. Day to mini
Goodnight!