Focus List 9/15 - Wedge and Trend Lines Break To Upside

Geoff Bysshe | September 15, 2011

After you read this post you should read this blog post: “SMH's Trading on Volume, and Back To Lead?” post date is 9/15 and it can be found here:
https://marketgauge.com/hsblog

Technology woke up today. Actually it’s been basing and turning up for weeks now, but today the SMH’s really drove the Q’s higher. The Q’s made a new high for the move off the Aug. lows, but none of the other indexes are even close their respective swing highs. This combined with the fact that the market has been unable to rally more than 3 days in a row since June makes me skeptical about the prospects for another decent up day tomorrow, but more important than a prediction of a big up day is weighing the evidence to properly apply our rules.

We’ve got positively stacked pivots in all 4 market watch charts so just like today the FTP is a key level of support. The intermediate trend is positive enough that the market bias should be bullish until we break below S1.

The phase as determined by the 50 and 200-day MA’s is bearish, but..

  • Q’s closed outside of the daily wedge I’ve been highlighting for several days
  • The other indexes closed above their trend line from the late August highs,
  • All 4 are above their positively stacked 10 and 20-day MA’s, although some are still negatively sloped.
  • All are over their 3-day pivot highs with the IWM & Q’s having a confirmed 3-pivot bullish bias by taking out the high of the bar that closed over the 3-day pivot high.

While that may sound like a big bullish list, remember it is in the context of a big consolidation in a bear trend. So don’t predict a direction. Know you have the OR and the pivots to follow whatever the market brings tomorrow. There are shorts on the focus list with negative stack and more negative trend so if you want a short bias you have that option.

Longs Focus
GLD
SLV
TLT
NEM
CELG
TSO
WYNN
IDCC
GMCR
JAZZ
SINA
BIDU
ISRG
CF
** Prefer OR Reversals **
CERN
MA
V
ED
AAPL
PCLN

Shorts Focus
MCP
SOHU
WLT
ACOM
CNX
NFLX
RIMM

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