Evening Watch List for February 21st

Mish Schneider | February 20, 2013

Well, rip your face off alright, only now market looks more like Phantom of the Opera! Even though the FED in division is no real surprise as they could not support low rates forever and, the dollar firming has spooked the market, this is a scenario that ultimately could be good for the US economy. At least that European vacation might be on the horizon now! Seriously, the seed change could yield some great opportunities; but for now, allowing the market to digest after what might have been a key reversal in the DOW and S&P 500 is prudent.

S&P 500 (SPY) Would not rule out a move to the 50 DMA or around 147.25. 152 should be decent resistance for now Subs: Pivots Negative and what could be a brick wall if confirms tomorrow

Russell 2000 (IWM) Like 89.00 for next support level with 91.50 overhead resistance Subs: Pivots Negative and what could be a brick wall if confirms tomorrow

Dow (DIA) After it could not clear 140.36 the 2013 high, the market began to smell fishy. Now, 138.32 nearest support then 137.15. Subs: Pivots Negative

NASDAQ 100 (QQQ) Another clue was the inability for this to clear Tuesday high after making a new 2013 one. 66.60 the 50 DMA support Subs: Pivots Negative

GLD Significantly oversold on the daily Relative Strength Indicator and now on the weekly one as well.

XLF (Financials) 17.30 would be a good place for this to find support

IBB (Biotechnology) 143.10 the 50 DMA support after what I have been saying is the one to avoid on the long side this year.

SMH (Semiconductors): Brick wall here and I would like to see 34.00 again for a new long opportunity

XRT (Retail) Let's see what happens at 67.00

IYT (Transportation) Finally getting a correction, but also first place to look for a new long when dust settles

IYR (Real Estate) Held the fast moving average as one of the better looking charts although a new high then close on the lows is always a reason for caution

USO (US Oil Fund) On the 50 DMA Subs: If golden cross is good, has to hold these levels

OIH (Oil Services) After 2 Inside days-you can feel just as comfortable shorting under the lows as buying over the highs. Subs: Will stay aside until we can see whether this holds or fails the 80 monthly moving average by February's end

XLE (Energy) A drop to 75.00 would be a good place to look at for a new long

TBT (Ultrashort Lehman 20+ Year Treasuries) The last 12 trading days have all been within the range of the big trading range made on February 1st. Subs: I want to get long but will see first if S1 holds tomorrow

XHB (Homebuilders) Landed on the 50 DMA practically giving up the year's gain in one day

UUP (Dollar Bull) Bottom is in. Subs: 22.21 the 200 DMA

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: We played out the bull market until today when we cleaned out most positions. Now, more cautious, less picks and a wait and see attitude.

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:

OPEN* Held S1 now at 54.73 max risk with R1 and today's high lining up.

Category 2: (Pipeline) N/A

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: (Opening range reversals are good on anything above S1)

MCK Held S1 and 103.25. 103 is max risk with slightly negative pivots so also has to clear 104.50 to look good

MBT Inside day.Pushing against the 80 monthly moving average with 19.90 max risk and 20.15 pivotal.

SRPT Reports 2/28. Held S1. 26.93 now max risk and could see move to 29.50 or so before earnings

AXP Held S1. Today's low max risk and over R1 clears today's high. Needs to clear 62.70

Category 4: (Rip Tide) Oversold (2 or more days under FTP), Condition 4, Needs to clear R1, Risk previous day low unless noted differently, Target- Day to at least 3 ATRs from entry:

CNQ Big correction to the 50 DMA and low risk to 29.77 if begins to firm

LVS Oversold. Broke the 50 DMA but stil has a positive slope so watch 50.45 as pivotal

Phase Change: YELP Almost an inside day. If 21.70 holds, returned over the 200 DMA and could see recent highs but has to clear them AFL* Held the gap provided it holds S1 49.66. FB Held S1 which means 28.17 now max risk and like to see it clear today's high NTES Inside day with max risk now 52.64 DLR* 2-day slingshot pattern if holds 64.68 with 65.29 the 10 DMA

Shorts:

Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing

MLNX Failed the 50 DMA with good stop over 54.80 and support at 50.00

IACI* Needs to break today's low and S1 and not clear today's high

CTXS Unconfirmed recovery phase. Max risk 72.60 to control risk

TDC 62.82 max risk with support at 60.00

Bye for Now!