From Tuesday's Daily: "With everything posting inside days, that makes Wednesday's trading range possibly the most decisive of the week." With now 3 substantial distribution days in volume (when the volume exceeds the volume from the day prior with a negative close), that is certainly fair warning that the hump day decisive action is for more downside. However, just to make the technical picture more interesting, NASDAQ closes below the 50 DMA, the Small Caps confirm the warning phase, and the Dow and S&P 500 remain in their bullish phases. Interest rates dropped, gold put in a second inside day to Monday's large trading range (not much of a bounce) and the earnings season is starting to cook.
S&P 500 (SPY) Although what first looked like a possible divorce from the small cap stocks, now looks more like just a trail separation. In other words, the divergence from small caps to larger institutional names remains, but eventually, even the strongest fall if the pressure is too great. Subscribers: 154.29 is the 50 DMA. It also held the channel I have been featuring on the video. If we get a bounce-first place to look. I am also now switching gears to more individual names rather than the sectors/groups as best for any new trades. Very little exposure to the market here-cash main position.
Russell 2000 (IWM) 88.79 the last swing low from February 26th. But with this now in a warning phase, unless it gets a monster move back over 92.00, seller of rallies is more prudent
Dow (DIA) Holding up better than some, but unless it clear 146.50, it could get hard down to the 50 DMA at 143.10
NASDAQ 100 (QQQ) Unconfirmed phase change to warning.
ETFs:
GLD 2 inside days now with a meager bounce from Monday's sell off. But as this continues to drop, there are support levels-next one under 130 is 128.
XLF (Financials) Hung onto the 50 DMA by a thread. 17.77 most recent lows.. Without financials, the sentiment will remain negative. Over 18.20 would bring renewed life
IBB (Biotechnology)Best shot to carry the ball if crosses 168. Otherwise, can drop back to 156 area pretty easily
SMH (Semiconductors) Unconfirmed return to warning phase. I still see this area as one for future growth. Looking to see if can hold 33.50 now. Subscribers: Stayed with the long position-only lightened up a bit on the position size
XRT (Retail) Another area that has to participate since a direct measure of consumer confidence. The 50 DMA is just below 69.20
IYT (Transportation) 104.40 is recent support and if holds 105 level, could still be a buy. Subscribers: A channel that took 6 years to clear, hard to believe in 3 months, will be negated. But have to be patient
IYR (Real Estate) FED says recovery fueled by housing sector. This better hold up over 70.50 or not very roseate
USO (US Oil Fund) Not seeing any signs yet of bottoming
OIH (Oil Services) Subscribers: There is channel support at 39.00 level will be watching
XLE (Energy) Hit the 200 DMA Subscribers: Returned to a trendline breakout on the monthly moving average and holding the 200 DMA-will be watching for more signs that it can hold here
TBT (Ultrashort Lehman 20+ Year Treasuries) Still holding the slingshot low Subscribers: Broke under my stop but then closed better. 61.20 is a place I am watching before reentering
XHB (Homebuilders) 28.00 key support
UUP (Dollar Bull) 22.60 is the weekly moving average
SGG (Sugar ETF) Subscribers: Sugar futures over 18.10 will bring an unconfirmed phase change to recovery-what I am waiting for
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
Category 1: (Aloha) N/A
Category 2: (Pipeline) Positive Phase, Condition 2-3, 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:
KBH Touched the 50 DMA with great support at 20.00. Like to see it clear R1
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)
BBBY The chart looks good, but I am nagged by the slingshot high at 68.30 which means that has to clear. Risk now is today's low
YELP Reports 4/29. The opening range reversal snuck by me but overall, I do like this chart longer term only if it can clear the recent highs. 25.50 area key support
BIG Reports May 20th. Has to clear recent highs 36.50 level to see a another move up. 35.50 good are to hold
DISH Reports May 6th. Inside day. Has to clear 38.00 now
ACN Slightly negative pivots. Doji day right on the 10 DMA. Like only now over today's high and R1 which line up
WHR Reports April 24th. Relative strength if holds today's low and clears 117.25 R1
SODA Reports May 6. 2 inside days. Took home ½ position after locking in 1/2 . But, will not hesitate to add over today's high and R1
Category 4: (Rip Tide) N/A
Phase Change:
INTC 22.44 the 200 DMA as resistance, but with 21.60 now the support
BEAM Reports May 2 Confirmed bullish phase. Inside day. Like to see it now clear 62.50
JWN Reports May 16th. Like only on strength over 56.00
PXD Slingshot low if clears today's high and R1. Swing traders can use the 200 DMA for a stop. Shorter timeframe stop is more like 110.50
NTES Reports May 13th. Inside day. Over today's high also gets this back over the 50 DMA
PETM Reports May 22nd. Outperformed and over R1 and today's line up. This could easily go to the 200 DMA at 67.44 and possibly beyond.
CAT Possible slingshot low confirmed if gets back through 82.00
Shorts: There are a few I am watching, but none that I am so thrilled with for a swing right now. (NFLX EW ULTA CTRX SINA)
Category 5: Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
SINA Reports May 12th. Inside day. 47.78 good risk and looks heavy if breaks 46.00
Bye for Now!