SPY retraced to 129.85 the area yet broke out from back in late June. 130.50 is the FTP and pivotal. Must also clear the 50 day moving average back at 131.45. On the weekly chart, the bullish trend remains intact.
QQQ came close to testing the 50 day moving average at 56.80 and closed with a DOJI day. Above the closing price at 57.54 on tomorrow's open, once it clears 57.88, still has to get above the 10 day moving average of 58.05, but looks a lot more likely that it will get up to 60 as next overhead resistance.
IWM this began to rally in late June from 81.00 which it tested today. Has three days under the floor trader pivot which comes in tomorrow at 81.71. Above that, especially if it can clear 82.42 and today's high 82.63, could very well take another shot up at the all time high 86.82.
With solid earnings in many of the leading stocks tempered by sobering news in the financial sector and in Europe, this is still a buy the weakness, sell the strength market. However, with the long-term trend positive, it is much more difficult to stay short than it is to stay long. And once again, we are seeing a lot of divergence in the individual sectors and groups.
Featured ETFS:
SLV and GLD although GLD started making its parabolic moves in early July, SLV is now beginning to catch up. Still has to get through 40. But above that, looking for 40 to 45 area. We have been long GLD over the last three weeks and reentered a long position in SLV last Friday. As with all parabolic moves, rather than trying to pick a top, use trailing stops and chandelier exits.
EWC**held exactly where it needed to at the 200 day moving average. Also closed slightly above the 50 day moving average at 31.59 The long term bullish trend is still intact. Above 32.00, especially on a closing basis, breaks a trendline on the daily chart. Could possibly be forming a head and shoulders bottom with the neckline above 32.90.
XRT** now three days under the floor trader pivot and maintaining its positive slope on the 50 day moving average. The FTP is at 55.71. Swing traders can buy and risk down to the 50 day moving average of 52.75, mini swing traders to today's low 53.24 daytraders 53.40. A close back above 54.73 puts it back in a strong condition. Then would expect a move to 56.
SMH closed just below the 50 weekly moving average now at 32.33. Held support at 32.10 which goes back to December 2010. Now, if it can get back above the 50 weekly moving average, will return to a long term positive trend. Otherwise, if it fails these levels, we are looking at a possible move down to 27.50 the 200 weekly moving average.
OIH held up well. Still bullish with overhead resistance at 154 and then 156. Overall target 166. Would only change bias if it breaks and closes below 151.80 in which case we could see a move down to 150.45 as next support.
XLE if it can get back above 76.90, see if possible move up to 81.
XLF closed above 14.60 the recent support level after testing 14.40 (end of 2010 the weekly low was 14.36). Now, if it gets back above 14.80, this very oversold ETF could get a bounce up to test 50 weekly moving average at 15.50.
Earnings: Tuesday AAPL CMG CSX HOG JNJ MMR BTU RVBD VMW WFC
Wednesday MO AMR AXP CAKE EMC EBAY JCI UTX USB INTC
Longs: ANF is just one example of the reason why a good way to use the list on a down day, is to wait for opening range reversals especially on stocks that have positive pivots. Many of last night picks had opening range reversals and all except for FCX had follow-through to the upside.
BBBY*had a bullish engulfing pattern. The pivots are positive. FTP at 58.79. A good risk for a day or mini swing trade is today's low 58. 10 day moving average at 59.34. Needs to clear that on a closing basis. Overall target 62.50. Day to swing
LO*Reports July 25th. Got long today on an opening range reversal but exited for a scratch before the close, which might've been too conservative. At this point, I will wait for it to take out the bull flag which will be above 110.10 on a closing basis. Now, underlying support at 109.15. Then, has a projected move up to 124. Day to mini.
CLF reports July 27. Had an opening range reversal which was a buy opportunity. Now, above 98.60, breaks from a trendline going back to the highs, with a projected move to 102. Support now at 97. Day to mini
ACOM* reports July 28. Another one I bought on an opening range reversal and conservatively exited because it could not close above the FTP. But for mini and swing traders, there was no reason to exit. Now, must clear 44.10 above today's high and R1. The FTP is at 43.46 which is negative, so that must hold. Overhead resistance at the all time high 45.79.If it gets through the highs projected move to 55. Day to mini
MGM*reports August 8. Now must hold 14.70 and clear 14.93. The FTP is negative and at 14.72. A close above 15 is a break of the trendline. Next overhead resistance at 15.80. On the weekly chart, a close above 16 and could see a move up to the 200 weekly moving average 24. Day to swing
NFLX**now oversold. With three days under the floor trader pivot, must clear 278.57 the FTP with a choice of risks. Daytraders can use the old high 277.70. Mini swing traders today's low 274.24 and swing traders the 50 day moving average at 261.45 although please note it reports July 25. Day to mini
ROSE** reports August 8. Had an inside day. The 10 day moving average is at 53.62 a good risk for a mini swing trade. Otherwise, if it holds today's low 54.57 and clear as 55.75, Friday made an all time high of 57.35. Above that a projected move to 62. Day to mini
Post-earnings: IBM, WYNN, traded higher after the close. On a breakaway gap, can either use a two minute opening range breakout provided the risk to the low is no more than one third ATR. Otherwise, to control risk either wait for a dip to the opening range low or preferably an opening range reversal. MOS has to clear the 200 weekly moving average at 67.71. Then, can use 67.06 where the 50 day moving average and R1 are for a risk.
Shorts: Some of the recent short picks such as WHR, AAP, AKAM, have worked out well. Many of the others are now oversold and if the market firms could be ready for a short covering rally.
NVLS*broke down last week from the 50 weekly moving average at 32.63. Would not want to be short above that level. Pivots are negative. Below 31.59, the FTP, can look at going short with a tight risk to today's high 31.68. Support at 30.48. Day to mini
Goodnight!
