Did a thorough analysis of the phases in all 4 indexes. In a nutshell: S&P 500 in a warning phase that could go either way-accelerate to downside or bring back buyers at least to test the overhead moving averages. NASDAQ in a strong warning phase, but holding the 200 DMA which probably means AAPL will be the do or die factor for its next move (points to down for now). Dow also now in an accelerated warning phase. Only aspect is that it is so oversold, the eventual test of the 200 DMA from here is not worth trading. Russell 2000 remains the most interesting. Possible bottoming formation remains intact. Big eyes there on Thursday. One more note: FED speaks, rates firm. But, that has been overall good for the important domestic sectors of the market-retail, real estate, financials particularly. Oh, the complexity of it all. As many successful traders will tell you-they make all their money perhaps 4 times a year. The rest of the time they sit on the sidelines. But, they remain relentless in their research because the world now turns on a dime.
S&P 500 (SPY) Subs: Oversold RSI so unless pops over R1, sidelined
Russell 2000 (IWM) Subs: Positive pivots. Has to take out and close above 81.53 to confirm a slingshot
NASDAQ 100 (QQQ) Are you ready for the AAPL show? Aside until Friday.
ETFs:
GLD Subs: A classic example of a weak warning phase with the 50 DMA still rising in slope. Looking for a sign to get in but it has to be a good one
XLF (Financials) One of the few in a bullish phase. Subs: Pivots positive
IBB (Biotechnology) Interesting that this is still in just a weak warning phase. Continue to watch Subs: Pivots Positive
SMH (Semiconductors) 30.34 is real important to hold as an overall barometer of the market. Subs: No confirm of a slingshot unless it clears and closes over 30.92. Shockingly has positive pivots
XRT (Retail) Subs: Positive pivots and weak warning phase. 62.09 its number to clear and close beyond
IYR (Real Estate) 3 lows around 63.40 makes this compelling if holds and clears 64.20-has to close above there as well. Subs: Today's high and R1 line up
USO (US Oil Fund) Really oversold. Best case would be an island bottom if gaps higher. Otherwise, leave it alone
TBT (Ultrashort Lehman 20+ Year Treasuries) We should see September highs here again.
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: Today's pearl EXP. As beta is mixed, it's still a stock picker's world. But, don't take your eyes off the macro picture. Until that shows signs of a relief rally, expect chop to continue.
Category 1: (Aloha) Positive Phase, Condition 1, 2 days under the FTPs, Risk to Previous Day low, Can buy ½ over FTP and ½ over R1, Target- Day to at least 3 ATRs from entry:
EBAY 48.70 is a safe risk and like to see it get back over R1 and today's high
TRV Correction after gap up post earnings. R1 and today's high line up
Category 2: (Pipeline) Positive Phase, Condition 2-3, 2 days under the FTPs, Risk to Previous day low, Can buy ½ over FTP and ½ over R1, Target- Day to at least 3 ATRs from entry:
MUR Reports 10/31. Has to clear pivots then 61.34 to look good ahead of earnings
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:
EXP Reports 10/29. 49.68 now key support with 51.07 recent highs
C Held 10 DMA. For swing still in. For new entries, 37.00 max risk
GS Improved to condition 2. Inside day. Max risk today's lows
GILD Reported. 67.56 the 10 DMA max risk. 70.39 recent highs
KORS Reports 11/13. Today's low max risk
LEN 37.55 max risk.
SRPT 23.75 max risk. Reports 11/1.
SIG Reports 11/20. 49.45 max risk. 51.35 recent highs to clear
PNRA Reported. 166.51 10 DMA support. Overhead gap 172.76 which if fills and continues, should take this to 2012 highs
OPEN Reports 11/1. Never cleared R1 which is now 47.26
Phase Change: CRM Possible slingshot pattern only if closes above 149.50 Reports 11/20. ROST Reports 11/15. Slingshot confirms only if closes above 61.61 CTRP Reports 11/5. Clearing 20.00 would look good IR Unconfirmed bullish. Today's low max risk
Shorts: Nothing with less than 12.00 RSI which has reduced the choices
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
NFLX Poor earnings. Today's high now good risk
FDO Back to unconfirmed warning phase. 64.89 good risk
FAST really want to see it break 43.54. And now not clear 44.01
CAT 83.30 now good risk
Bye for Now
