Earnings season has not been kind to the leading stocks AAPL IBM and now AMZN. Let's not even talk about NFLX-that fall from grace happened quite some time ago. The recent run, which came to a screeching halt today, was led by retail (XRT) and energy (XLE) and as I wrote last night, both were very overbought and due for a selloff. What happens now? Given the accumulation phase in QQQ and recovery phase in SPY IWM DIA, even with lower prices, do not see a meltdown here but would certainly not rush into buying until market internals improve. Today was the first distribution day in volume since October 7th in SPY. Volume patterns over last 2 weeks-light but positive.
SPY The danger of clearing a price without big volume. 123.50 now pivotal with support at 122.10. Big note: If SPY closes above the 80 monthly moving average by end of the week, will be the first time since July.
QQQ If you watched the leading stocks today, they were your first clue.
IWM* 71.16 yesterday and today's low. Since the leaders are in the hospital, now watching midcaps to make the next move.
ETFs:
GLD Cleared the top of the recent range with first good day of volume since September 26th. Overhead at the 50 DMA 169.35 with overhead gap should it get really going at 172.20. Subs: Pivots at 164.10
XLK (Technology) 25.50 pivotal, 24.80 EMA support.
SMH (Semiconductors) Could not clear the 200 daily moving average. Let's see if gets to and if does, what happens at 30.00. Also notable is the doji day at 31.31 pivotal
XRT (Retail) Inside day with next support at 51.20. Would like to see more digestion before a new long entry
IBB (Biotechnology) Typically a leading sector/group, has not closed above the 200 DMA since early August. Let's see what happens at the 50 DMA.
XLF (Financials) 13.00 now key support and closed right there. So, either it will go to 12.48 again or clear 13.48. Lots of noise in the middle
OIH (Oil Service Holders) I often write about this as a first choice on down days to short. But, the whole range was made in the first 30 minutes then it just chopped around. Subs: 120.66 S1 and 123.30 the negatively stacked FTP.
Longs: When perfect setups get harder to find, always good to watch the ETFs and Indexes.
COST Would like to see it clear R1 84.15 and hold 83.35 if does. If can close above 85.35, will be highest close and could mean a move to 90.00. Day to mini
CBST 2 days under the FTP and not a classic condition stock so must clear R1 39.75. Reasonable risk is 38.25, the 10 DMA and under today's low after an inside day. Recent all time high 40.49 with more upside if market holds. Day to mini
ANN Inside day above the 200 DMA at 25.83, a good risk. Pivots are neutral at 26.67 and if clears recent highs 27.03, could see a move to around 30.00. Day to swing
YUM Close to the moving averages which all converge at around 52.00. Half the normal volume today which is why important to check that on Hotscans. 2 days under the FTP at 53.14 with R1 at 53.62. Over 54.00, next resistance at all time high 57.75 and if that breaks, could see a 7.00 move. Day to swing
ABT Never setup today. Had a big red candle last week, but since, trading within that range. Has 3 days under the pivots at 53.26 with a good wall of support at 52.85, the 10 DMA with some slippage. R1 at 53.58. Top of that candle 55.61 and a close above that area looks good for a move to 60.00 Day to swing.
Honorable Mention: OR reversals. ADP (must hold S1 pivots neutral) NTES (provided 47.17 holds) 7 days down in a row and oversold JVA (must clear R1 11.12-the 200 DMA 10.55)
Shorts: All in a bear phase and negative pivots
LULU Under the 50 DMA at negative pivots at 52.45. Must also break S1 51.00 to see a retest of the 200 DMA at 48.20 next support. Day to mini
BAX Under all the moving averages on the daily at 55.20 which if clears could be an interesting reversal. Otherwise, pivots negative at 54.51 and R1 55.00. Next support 52.00 and if that breaks, 50.50 Day to swing
CRM (Nov 18) never broke S1 which now comes in at 128.19 with negative pivots at 130.02. Under the moving averages at 134.60 which again, an interesting reversal if clears. R1 a closer risk is at 131.44. If breaks, could see 124 and if market falls, 115.00. Day to swing
SOHU Inside day and barely holding the 10 DMA at 57.44 with today's low 57.22. Negative pivots at 58.90 and S1 at 56.16 which if breaks could bring this to 54.50 then 48.00. 80 monthly at 46.00. Day to swing
Hon Mention: TAP and PEP are not very exciting, but still have a lot of downside potential if patient
Goodnight!
