Evening Watch List for February 21st

Mish Schneider | February 20, 2014

“Henceforth, we need to see confirmation Thursday and with increasing volatility.” Two reasons I am quoting myself from last night’s daily. One, because I really do love the word “henceforth.” Secondly, because the concept of “confirmation” and “increasing volatility” is one that will keep you out of trouble and falling in love with an opinion.

The Dow climbed back to an unconfirmed bullish phase, NASDAQ negated the possible reversal candle, TheRussell 2000s set up a launch pad from its 50 DMA and the S&P 500 although still working a potential double top, seems more likely to resume the melt up possibility.

Therefore, I end the week full circle from how we began- “Tops, like bottoms, tend to be dramatic. Therefore, I am anticipating more upside with the distinct possibility the market experiences (hard to pinpoint when) another run up to new highs with much more exuberance in volume. “Quote from the weekend daily.

S&P 500 (SPY) 184.95 the highs and 181.38 critical support Subscribers: Positive pivots in all.

Russell 2000 (IWM) 112.85 critical support 115.64 this week’s high to clear

Dow (DIA) 162.34 the high to clear with 159.63 key support

Nasdaq (QQQ) Even without AAPL today, managed to hold well near the highs

XLF (Financials) confirmed warning phase, albeit a weak one

SMH (Semiconductors) New highs-nice living in the semiconductor bubble!

IYT (Transportation) One more push will get this back over the 50 DMA

IBB (Biotechnology) A classic example of why we need confirmations a second day

XRT (Retail) Held where it needed to and looking cheap relative to the overall market

XHB (Homebuilders) 2 inside days-big eyes here!

GLD Back over the 200 DMA and looks pretty darn good

USO (US Oil Fund) Overbought and an inside day

OIH (Oil Services) 48.00 resistance with an inside day to watch as well

XLE (Energy) Inside day here as well

TBT (Ultrashort Lehman 20+ Year Treasuries) Through 72.05, now back to looking at 74.00 area

PHO (Power Shares Water Resources) New highs

UUP (Dollar Bull) 21.60 an area to watch

EEM (Emerging Markets) Subscribers: Held the 10 DMA but still underperformed

CORN (Corn) Subscribers: Inside day

JO (Coffee) Subscribers: Inside day

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) 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:

CSIQ Has to clear R1 39.89 and hold today’s low or the 10 DMA

YUM The 10 crossed over the 50 DMA making today’s low a good risk if clears R1 73.38

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)

HSP Inside day and still very compressed so worth keeping on list with 44.29 the best point to clear

DOW 47.32 is the point to clear for probably a daytrade add

Category 4: (Rip Tide) N/A

Phase Change:
NBL Tried to break over the compression, and now has to hold today’s low with an inside day
TIF Broke out the end of the day holding the 50 DMA. Look for follow through over 89.48
Long ½ position and will look to add if clears and holds over the 50 DMA
KBH Over R1 18.94 is a start with 18.42 a tight risk
MAS back over the 50 DMA with 22.46 or R1 point to clear
WLP Over today’s high clears the 50 DMA with a good bottoming formation
ONVO 10.47 elusive until its not
YOKU A fave with 2 inside days on the 50 DMA and tight risk
GM We kept our ½ position and now it is back over the 200 DMA with an inside day. Over 36.72 if the market is up will add back the other ½.

Shorts: We have a smaller SDS position

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

RAX 35.25 good tight risk point with some support at 33.50

Category 6: White Cap-N/A

Bye For Now!