Four
of nine sectors moved higher on Tuesday…XLU, XLP and XLE were the strongest sectors…while
XLB was the weakest sector.
Breadth strengthened
slightly…decliners led
advancers…1.59 to 1 on the NYSE and 1.64 to
1 on the NASDAQ.
Tuesday – strengthened slightly, decliners led
Monday – weakened,
decliners led
Friday – weakened,
advancers led
Wednesday – unchanged, advancers
led
Tuesday – strengthened,
advancers led
SPY down .78 at 179.75…volume 116.5 million shares
VIX up .32 at 14.55…
TNX down .26 at 27.75…
TLT up .38 at 103.71...
XLF down .22 at 21.25 volume
27.7 million shares
AAPL up 15.09 at 566.32 volume 16.1 million shares
FB down .33 at 46.73…volume 32 million shares
Technical
Commentary:
DIA – 0.58%,
IWM – 0.48%, SPY – 0.43%,
QQQ – 0.08%.
Each of
the broad index ETFs pulled back to short-term support in a bull flag pattern
on Tuesday as taper speculation began to surface as auto sales . The SPY, IWM and DIA formed a spinning
top and the QQQ a doji which could be the second candle in a potential
morning star pattern. Weakness in financials XLF contributed to weakness in the SPY.
The VIX
did confirm today’s pullback with its highest close in six weeks, but the VIX
did close below its open as the SPX found intra-day short-term support
and bounced over 7 points from its low.
We alerted
you on Friday to adjust stops and be prepared for a potential pullback. On Wednesday watch for a potential support bounce and potential entry
signal into bull flag patterns.
Continue to trade with the trend.
TSLA +20.53,
+16.53% as German
regulators cleared the company of any safety defect in recent auto fires. The stock completed a reversal pattern
breakout following a MACD bullish divergence.
AAPL +15.09,
+2.74% after UBS
upgrades AAPL from neutral to buy and raised it price target from $540 to $650.
MU +0.56,
+2.63% after
Needham initiated coverage with a $30 price target.
KKD -4.96,
-20.20% after
meeting estimates of $0.16 eps, 33% growth from year ago, but missing revenues with
$114.2 million vs. $117.67 million estimate.
Albert Einstein: “Insanity: doing the same thing over and over
again expecting different results.”
Remember it is big money
that creates and sustains the trend. As Granville wrote,
“technical analysis is the art of tracking the market, following the
footsteps of the ‘smart money’ crowd.
The ‘smart money crowd’ is no mysterious ‘THEY.’ It is simply a collection of people who are reading the market correctly,
seeing through the maze, unconfused by this hall of mirrors.”
New short term chart targets:
Chart Targets:
SPY = 182.06, 183.02…Friday’s
high 181.75
QQQ = 85.14, 85.77…touched
on Friday
IWM = 114.39, 116.10…Friday’s
high over 114
Short-term SPY posture is
down in bull flag pattern.
Support Levels
ES = 1,797, 1,783, 1,774
SPY = 179.93, 177.98
QQQ = 84.11
IWM = 111.62, 110.88
Q3 Earnings Reactions
Positive Reactions – SPLK, MRVL, GMCR,
JCP, LZB, JKS, BRCD, TSN, YOKU, SINA, NTAP, SLXP,
PCLN, NVDA, GRPN, AWAY, PRU, TPX, TSO, CTSH, FSLR, TRMB, MDVN, NATI,
SPR, ONNN, EXPE, CRR, HAR, GTI, ATML, THOR, TRN, FLT, MCHP, ITT, DICSA, ANR,
SWKS, FB, CMCSA, GILD, DWA, LVLT, EA, SEE, SPW, TFX, JCI, X, XRAY, XYL, JLL,
PBI, ALR, HUN, ACT, DECK, AMZN, MSFT, FLS, AVY, ALXN, WOOF, COG, BA, CLGX, ESI,
EQIX, WLL, TSCO, RRD, PHM, RCL, ALXN, APOL, BCR, NDAQ, NSC, WHR, ILMN, NUS,
GNTX, LXK, DD, VFC, CMG, GOOG, BHI, GE, KSU, MS, SLB, STI, LVS, VZ, SNDK, NUE,
BTU, AXP, KEY, STLD, URI, USB, INTC, JNJ, SCHW, COST, AA
Negative Reactions – ROST, GME, BBY,
CPB, JEC, TSL, CRM, CSCO, RAX, MNST, QCOM, SCTY, IPGP,
AIG, BRKR, HME, NEM, XLS, Z, NIHD, AVP, WTW, ROVI, GRMN, JDSU, OSK, CNW,
ITRI, CTRX, KRFT, GRMN, MYL, DLR, XCO, WU, LNKD, IACI, MSM, INGR, HTS,
VRTX, AAPL, PMCS, MWV, SOHU, AGNC, AGCO, PCL, GT, CMI, VSH, ALSN, ROP,
EW, MRK, RYN, RMD, NCR, KBR, FSL,
ESRX, EMN, FIO, SIRI, CAM, TKR, SYMC, CVA, CDNS, AKAM, XRX, CRI, ORLY,
CAT, NFLX, COH, ZION, WAT, EMC, UTX, TXN, HON, ISRG, GS,
UNP, UNH, EBAY, IBM, XLNX, SCSS, SWK, MU, FAST
The Market Forecast Green Line is above
80.
____________________
Setups
H
Breakout: ADSK, BIDU, STX, LVS,
Diagonal Breakout: BRCM, FB,
Bull Flag: BBBY, CMCSA, COST, ESRX, GILD, GOOG, MAT, NFLX, ALK, C,
DNKN, RCL, SPY, SWI, UAL,
Potential Bullish Divergence:
Gap Up:
Gap Down:
Bear Flag:
At Support: ROST,
C- Pattern:
Moves
New Highs: MU,
Gap Up: TSLA, GRPN,
Gap Down: FAS, KKD, RAX, V,
H Breakout: GOGO,
Breakout Test:
Bounce: AKAM,
MACD Divergence Bounce:
Bear Flag:
Support Break: SHLD, ATI,
______________________
32 out of 100 NDX
stocks closed higher on Tuesday and two were unchanged.
Leading NDX 100 stocks included: TSLA, AKAM, MNST,
AAPL, MU, ADI, LLTC, MDLZ, EBAY, VIP
Lagging NDX stocks included: SHLD, REGN, GILD,
CHTR, MYL, GOLD, BIIB, VRTX, AMZN, CELG
Leading stocks > +2% on Tuesday
included: GOGO, GRPN, SCTY, SSYS, XONE, MCP, QIHU, CLF, X
Lagging stocks < -2.0% included: KKD, RAX, NTES, UAL, FIVE, F, Z, LCC,
FAS, GME, SCSS
Stocks to Watch on Wednesday
Holding Above 30 DMA= 55
CTSH, VOD,
ADBE, SBUX, MSFT, XRAY, AAPL, HSIC, FISV, INTU, LINTA, PAYX, WDC, CHKP, GOOG,
ADP, AMZN, MAT, CA, COST, LLTC, TXN, MCHP, MU, EXPE, NFLX, ADSK, ESRX, ALXN,
GILD, MYL, PCLN, MDLZ, MNST, YHOO, QCOM, NTAP, SIAL, CELG, BIIB, GRMN, CERN,
CMCSA, CTXS, LBTYA, GMCR, BBBY, DTV, STX,
NVDA, LMCA, BIDU, VRTX, BRCM, AVGO
Moving Above 30 DMA = 4
EBAY, KLAC, ADI, TSLA
Moving Below 30 DMA = 9
ATVI, PCAR, SHLD, SIRI, SRCL, WYNN,
DISCA, REGN, CHTR
Staying Below 30 DMA
FOSL, ISRG,
NUAN, INTC, ROST, SYMC, AMGN, DLTR, GOLD, SNDK, SBAC, CHRW, EQIX, FOXA, EBAY, SPLS, CSCO, VIAB, AMAT, VIP, WFM, CTRX,
KRFT, VRSK, TSLA, EXPD, FAST, FB, MXIM,
AKAM, ORLY, FFIV, ALTR, XLNX
Sixteen Week
Intermediate Term Market Trend: Up
3-Day Short Term Market
Trend: Down
