Focus List 10/28 - The European Cloud Lifts

Geoff Bysshe | October 28, 2011

Good news from Europe created a nice expansion day in all 4 market watch charts as well as in the financials, energy and semiconductors. It also eliminated the divergence in the daily market watch charts as I've said could easily happen.

It's very hard to have a strong conviction in which way the market might go on a day after a day like today. It being Friday and near the end of the best performing month in decades I'd be inclined to say momentum and window dressing will keep the momentum in tact. But don't let emotional opinions or hope get in the way of objective trading - trade by your rules. You're more likely to make money if you stick to your plan, than if you try to catch the next big trade.

With everything so strongly pointed up, the key levels will be the FTP and S1. Either can serve as a good reverence point to look for bullish OR reversals. On the upside, don't expect that stocks will continue effortlessly higher. Be careful not to buy breakouts in stocks that are too extended on the daily charts.

In short, the market may feel different because of the big gap, but don't let the fool you. Don't be surprised if the market consolidates for a day or two.

Longs

AAPL
ALXN
GOOG

OR Reversals

ABT
YUM
WFM
BBBY
COST
QCOM
GPC
RAX
BIIB
ANN

Thru R1

CERN
CELG

Shorts

SLV
PAAS
AGP
RIG-extended
OPEN