New Trade Alert
Trade: HLX 24.01 buy stop with limit 24.05
Instrument Name: Helix Energy Solutions Group
Position: Long
Stop: 22.94
Target: Partial Profit at 25.49, 3 ATRs and matches February's highs.
Trade Description: As the market is in divergence, I am giving you a stock to trade instead of an ETF. HLX crossed over the 80 monthly moving average in January 2013, first time since 2008. We will risk 2 ATRs since if this is basing over the last 5 years, the possibility for this to double in price in the longer term is worth that risk
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Open Trade Update
Trade: SMH 35.80 Long
New Stop: 35.09
First Target: 36.40 1/4 - 1/3 of position size profit then 37.50-37.80 another 1/4 off
Trade Description: The Market on Close Stop Order at 35.29 kept us in for Monday.
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Open Trade Update
Trade: XLF 17.96 Long
New Stop: 17.89
First Target: 18.75 (take off 1/3 or so) Note: Some of you might have taken some profit at 18.37 or 1.5 ATRs from our original entry.I change the stops as I see how the market is reacting. Mainly, I am trying to avoid your getting stopped out only to see it reverse while at the same time, protecting you from any key reversals to the downside
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Analysis for Monday, 3/18/13
From an older issue of the daily, here are the 4 signs of a top once again 1. Blow off rally with huge volume, 2. Slingshot patterns, 3. Island tops or, 4. Two or more tops made at resistance areas. Last Thursday night I wrote about 4 possible scenarios, one of which was that the Dow does not make it to the 2007 high after a valiant effort, then begins its descent. Friday, if you combine the 4 signs of a top with the 4 possible scenarios after a 10-day rally, the one that nags at me is the possible island top in the S&P 500.
If you look at the daily chart, the gap up from last Wednesday's high followed by the gap lower on Friday, leaves that possibility. However, like all fresh signals, it needs confirmation. Therefore, although the S&P 500 was the only index to have this possible formation, it is worth noting unless Monday proves to the contrary.
S&P 500 (SPY) The 2007 high was 157.52. Thursday's high was 156.80. A break and close under the fast moving average, 155.20 would not be a good sign. Plus, it needs to close the gap to Thursday's low 156.22 to negate that island top. Subs: Pivots Negative. If SPY can get through Friday's high, also clears R1.
Russell 2000 (IWM) 93.75 remains pivotal as this index held up well and as the 2013 leader, makes the performance in the SPY a bit less suspect. However, in 2011, the last time SPY made an island top, Russells held up for a day or two, then collapsed. Subs: Pivots Positive
Dow (DIA) No island here either and some underlying support at 143.65. Subs: I will use caution until we get some clarity on whether or not the market is resting or done for.
NASDAQ 100 (QQQ) 69.00 has to clear and 68.00 has to hold. This range is holding tight for now and a good confirmation on whether it's island top or just a breather in the rest of the market. Subs: Logic dictates that since this index did not move along with the others, should the market turn around, this would be the first place I would look to short or buy QID.
ETFs:
GLD Lots of congestion to clear over 154.70 for this to make a move higher. Subs: Got long but did not stay with it. May be basing but has to clear Friday's high.
XLF (Financials) 18.20 is first area of support to watch for a hold if this is going to continue a bull move. Subs: Using the 10 DMA now for our trailing stop in the swing based on a closing basis
IBB (Biotechnology) One sign of a potential rollover is a slingshot high. If this confirms, another big warning sign Subs: BMRN had a brick wall high if it confirms on Monday.
SMH (Semiconductors): Just couldn't get through 36.00 with a potential brick wall pattern. Then, we will be looking at the 50 DMA to uphold the bull phase. Subs: We took a no loss stop on the entry from 35.38, but if this holds and clears back through the 10 DMA will consider a reentry
XRT (Retail) Filled the gap from Thursday. Like to see how a second day of either correction or resumption turns out to help complete the puzzle.
IYT (Transportation) Failed to clear 112, but unless it breaks 109.85, was just a healthy digestion Subs: Keeping a no loss stop on the balance.
IYR (Real Estate) Held up with an inside day but has to clear 69.50 to negate the possible top on 03/06.
USO (US Oil Fund) Confirmed phase change to accumulation with doji hammer. Subs: Entered long on an opening range reversal with a stop under the 200 DMA. Could see 34.15
OIH (Oil Services)Peeking its head over an important moving average on a monthly basis and if holds could be a longer term bottom in place. Subs: 2 weeks left to see if this can close over the 80 monthly moving average 43.76.
XLE (Energy) Got through 2013 highs and closed on the week with an inside day.
TBT (Ultrashort Lehman 20+ Year Treasuries) 68.00 area has to hold as this continues its basing action. Subs: Like this over R1 and Friday high
XOP (Oil and Gas Exploration) As one of my favorite sectors this year, now trading at the top of a trendline going back to 2008.
XHB (Homebuilders) Still has to clear 30.00
UUP (Dollar Bull) Subs: Could be a brick wall top, but let's see what happens at the 200 DMA.
EWI (MSCI Italy Cap Index) Subs: Perhaps it's basing, but has to clear this area or will look better as a short
Bye for Now!
