S&P 500 led the session-gapping up and rallying in a controlled fashion throughout the session. The volume was good, clearly not at Friday levels, but just under average. Most important is that it cleared the 200 DMA. The other 3 indexes have lots more to go before we talk about the 200 DMA. These diversions never cease to fascinate me. Will NASDAQ after a very impressive day in AAPL and GOOG carry on? Was SPY the first to clear with the others on its heels? Or, will the leaders run out of gas and bring SPY back to its 200 DMA knees? And, all this with a shortened trading week! One thing to note-market internals flagged bullish.
S&P 500 (SPY) 139.25 11/13 high now to clear and has to hold the 200 DMA to not look like a one day wonder Subs: Back to a strong, unconfirmed warning phase after its Friday slingshot
Russell 2000 (IWM) Still has lots of work to get it back to the 200 DMA. Like to see 79.00 hold. Subs: Back in the channel featured on the video. Want to see the gap from today hold
Dow (DIA) Accumulation day again today in volume. Stopped right at the fast moving average which now has to clear
NASDAQ 100 (QQQ) Strong end after big gap higher and although volume not as strong as Friday's, price action suggests this can continue to rally. 63.30 is a support level and 63.87 last week's high to clear. Subs: AAPL confirmed the slingshot pattern. 555 should hold.
ETFs:
GLD 167 the fast moving average is the area to hold
SLV The 50 DMA is very close indeed. Today's gap low should hold
XLF (Financials) After Friday's visit to the 200 DMA, now has to hold 15.45 and clear 15.63, then the 50 DMA to keep confidence.
IBB (Biotechnology) 131.00 support to hold but first with a doji candle, 133.40 is pivotal
SMH (Semiconductors) Still lagging. Has to clear 31.15 but really the 50 DMA overhead to be a real contender
XRT (Retail) Nice bounce off of the 200 DMA and still showing itself as a strong group. 61.25 has to hold.
IYT (Transportation) Subs: Back in the channel and like to see it stay there
IYR (Real Estate) Like to see Monday low hold and then still has to close back above the 200 DMA. Still an important group to watch.
USO (US Oil Fund) With tensions building in the Middle East, would certainly not short unless there is a very tight risk
XLE (Energy) Closed back above the 200 DMA with an unconfirmed warning phase. Gap low has to hold. Next resistance, 71.00
TBT (Ultrashort Lehman 20+ Year Treasuries) 60.26 next area to cross Subs: TLT Slingshot pattern in place from Friday high
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: With short week, keeping list down for new swing longs to ones with the least amount of risk
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:
AEM A reversal against the 10 DMA 54.72 good with the 200 weekly overhead to clear 56.33
MTB Back to bullish unconfirmed and DOJI day. Max risk today's low. Like to see the 10 DMA clear
BEN Improved to condition 1. Has to hold 129.15 and clear 131.00
MA Broke from trendline. Has to hold 477 and has room to upside
URI Gap over the 10 DMA which has to hold. Ultimately 41.54 has to clear
SWN Has to clear 36.87 and then we can see how it acts at the 200 weekly moving average. Max risk today's high
XRAY DOJI candle which means good to follow if opens unchanged or better. Risk today' low
Phase Change: LULU Reports 12/6. Back to unconfirmed warning phase. 70.25 a good place to hold CNX Unconfirmed warning phase and has to clear the 50 DMA at 32.86-an important pivotal area WYNN Inside day with a hold of the 200 DMA and a move over today's high clearing other moving averages AAP After hitting the 200 DMA has a bull flag forming with a breakout over 78.55
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
DG Back to unconfirmed distribution phase and red in a sea of green. Has to break 48.20 S1
CHTR Underperformed. Needs to stay under pivots 69.02 and then break S1 68.08
ENDP Inside day. Like to see it break under the 10 DMA.
CLF Must stay under 35.50
Bye for Now!
