Second day of low volume correction, which is bullish action. And AAPL, GOOG leading the charge. I see last couple of days as a gift should markets firm from here. We have established areas of support to hold and reference points above to penetrate. And, some volume returning would be comforting confirmation.
Subs: SPY IWM 2 days under pivots which means treat like a condition 1 correction. DIA Negative pivots and closed above therefore have to see R1 clear. QQQ overbought, yet still has to clear R1. See QQQ as a confirmation to buy the others provided it holds S1 and the others confirm.
S&P 500 (SPY) 147 remains pivotal
Russell 2000 (IWM) It seemed as though this might test the 84.65 level. But after 2 days, hanging out above the 10 DMA with 2 doji days in a row
Dow (DIA) Closed green. Above Monday high could see another leg up provided 135.15 holds
NASDAQ 100 (QQQ) High RSIs on daily and weekly, but along with the leading stocks, looks as though it will have more upside from here provided 69.80 holds
ETFs:
GLD Inside day.
XLF (Financials) Held 16.01 old 2012 high. Now, over today's high could get interesting.
IBB (Biotechnology) Another new high and why one should never fight a trend.
SMH (Semiconductors) Tested and held near support. Now, watching this to see if can firm and gain upward momentum back over 33.00
XRT (Retail) Touchdown on 10 DMA, which has to hold
IYR (Real Estate) Has to hold the 10 DMA now
USO (US Oil Fund) Inside day under the fast moving average. Over Tuesday high better. Otherwise, vulnerable down to the 50 DMA
OIH (Oil Services) Subs: 2 day correction similar to a condition 1
TBT (Ultrashort Lehman 20+ Year Treasuries) Subs: Still friendly over the high of today
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: After a 2-day correction, had to narrow down choices. Only listing ones that held S1. If market is strong, others will most likely trigger as well. Please ask if unsure.
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:
V Now 3-day correction closer to the max risk 131.72. 133.30 first place to hold.
EXP 45.26 max risk. Classic condition 1 correction however, low volume stock
RRC 68.50 the 10 DMA max risk. Ideally want to see this cross R1.
KSS 52.85 max risk. Also like to see it clear R1
SHW Only 1 day under pivots but since yesterday's were neutral including here. 144.25 max risk and like over today's high
COST Today's high and R1 line up with max risk 100.80
CTXS Has to hold today's low
EOG 113.67 max risk. Today's high and R1 line up
LNKD Has to hold 119.22
UNP Max risk 124.31. Today's high and R1 line up
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:
AMGN Confirmed bull phase. Has to hold 81.68, the clear the 10 DMA
MON Inside day. Max risk today's low
WPI Improved to condition 1. 81.78 S1 and good risk
IBM Inside day. 210.69 is the 2012 high to clear next
CAVM 2 inside days. 34.29 max risk.
CRUS 2 inside days. Max risk 43.41 and has a slingshot from 45.49 that has to clear
Phase Change: APD R1 and today's high line up CREE 28.10 max risk. Today's high and R1 line up
Shorts:
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
HLF Can use today's high or R1 as max risk. Support at 48.00
PCP Inside day cannot clear today's highs
TKR 40.23 R1. Support 38.50
NFLX Should really stay under 57.02 the 10 DMA
Category 6: White Cap-Having a 2-3 Day correction over the pivots. In a Negative Phase, Positive Pivots. Can sell an Opening Range High Failure if happens below R1 or previous day high whatever is higher and/or weakness if breaks S1 and prior day's lows
MCP Only under today's low
Bye for Now!