Friday, June 25, 2010

SPX Finds Buyers at 61.8% Fib Level...Forms Bullish Harami...

DJIA                          10,143.81   -8.99  -0.09%
SP500                         1,076.76   +3.07 +0.29%
COMPQ                       2,217.42  +6.06 +0.27%
Russell 2000                  645.11 +11.94 +1.89%

Exchange                  NYSE              NASD
Advancing                 2,228               1,824
Declining                     814                  828

Oil           $78.86       +2.31
Gold   $1,255.80      +10.30
SOX        352.09        -0.13
VIX            28.42       -1.22

Index  Direction      Confirmation
VIX      Down           Yes – SPX
SOX    Down            No – COMPQ

After four consecutive down days, buyers stepped in at the 61.8% Fibonacci retracement level and the market came into balance. The RUT led the other broad indexes with a gain of 1.89%. The VIX moved lower confirming the modest move up in the SPX and the breadth was solid as NYSE advancers led decliners 2,228 to 814.
Check out these Charts
(click image to enlarge)

The annual reconstitution of the Russell Indexes will take place after the close of the market on June 25 , 2010 and final listing will be posted for the Russell 2000 and other Russell Indexes on June 28. This will likely create some additional short term buying in the stocks being added to the indexes.

Bull Flag List
ThursdayHAS has entry signal

Friday UCO, GMCR, ICE, CAT, NFLX ABC, AKAM, AZO, BA, BIDU, CMG, ILMN, UNG and TIE have either and intraday or end of day break above the high of the low day.
Check out these Charts
(click image to enlarge)

CRM, DECK, CRUS, NYX, AAP, DLR, FFIV, NTAP, SBUX, SKX, SNDK, SWN, UNP, VECO and VMW form a good flag setup and a bullish candle pattern with a potential break of the high of the low day on Monday.
Check out these Charts
(click image to enlarge)

AAPL, BRCM, ALK, CAL, UAUA and HSY make new low day in a fifth day of pull back.

Remember the entry on a flag is a break above the high of the low day, so watch for a potential entry signal on Monday.

Guidance:
The SPX found support at its 61.8% Fib level from its June 8 low. The SPX tested 1,071, touched 1,067 before rallying to a high of 1,083 which is right in the middle of the 1,081 to1,085 short term resistance area, before pulling back to close up for the day at 1,076. The SPX formed a spinning top which is part of a two day candle bullish harami which suggests the potential for a support bounce on Monday. Look for the formation of a higher low and higher high on Monday and for potential confirmation of Friday's bullish harami.


Tighten up stops to protect profits on your short term bearish trades.

If a support bounce fails to appear on Monday, stay with the short term down trend while looking for a potential break above the high of the low day in up trending stocks on Monday.

Trade strong stocks up.
Trade weak stocks down.

The VIX fell -1.22 and closed at 28.52. Volatility stayed above the important 25 level on Friday.

The short term 3 day trend is down.
The six-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -2.30
QCOM -0.22
GOOG -2.42
BIDU +2.30
NDX 100 stocks stronger than the NDX include: URBN, PCLN, WYNN, BIDU, CERN, CELG, JOYG, ILMN, AMZN, SRCL, FSLR, ORCL, AKAM, FWLT and GILD.

Stocks weaker than the NDX: RIMM, APOL, DISH, MSFT, CSCO, MRVL, INTC, ADBE, PAYX, ROST, NWSA, AAPL, CMCSA, LOGI and VRSN.

Stocks to Watch on Monday
Holding Above 30 DMA
TLT, NFLX, SNDK, CMG, VMW, TIE, DECK, DLR, SWN, UNG, CRM, CHL, LVS, CRUS, AMX, CLF, HAS, HLF, FFIV, NTRI, GMCR, BA, CAT, DE, NETL, USO, V, MA, HANS, UCO
Moving Above 30 DMA = 14
ACN, AIV, BUCY, FCX, GS, ICE, NYX, PCLN, SPG, TSL, UNP, URE, VECO, ZION
Moving Below 30 DMA = 3
FAZ, UAUA, HSY
Staying Below 30 DMA
A, AMD, GR, MCD, LXK, ATI, CAM, DHR, DOW, MHS, PCP, USD, WHR, WLT, CREE, PNC, POT, WFMI, WMT, SWK, CSTR, ESI, BYI, STI, JEC, GME, FAS, FLS, PCP, ATW, BAC, GES, X, AGU, IPI, MOS

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

1 comment:

K said...

Dave, Thank you so much for your insight in these writings. It is truly very helpful! I try never to miss one! Hope you have had a great weekend! Kathy :)