Thursday, December 2, 2010

SPX Forms Another Large White Candle as Support Bounce Continues...

On Thursday the SPX closed at 1,221, up +15.46 or +1.28%, the COMPQ moved up +29.92, the INDU rose +106.63.  The RUT closed up +8.06 making a new high close following its horizontal breakout on Wednesday.

Breadth weakened from Wednesday but stayed strong on Thursday as advancers led decliners 2.46 to 1 on the NYSE and 1.74 to 1 on the NASDAQ…

Exchange       NYSE          NASDAQ
Advancers      2,146              1,668
Decliners           869                 954

Index Direction      Confirmation
VIX       Down            Yes – SPX
SOX     Up                 Yes – COMPQ

Leading stocks on Thursday included FAS, ZION, WHR, STI, GME, ICE, BAC, JEC, SWK, UCO, USD, NDAQ, LXK, DE, URE, ESI, ATI, HAS, AIV, NYX, GS, PNC, INFA, DOW, CLF, WFMI, UNP, HLF, V, LDK, SNDK, SWN, SPG, AKS, FCX, ATW, F, CAM, MHS, A, TIE, CREE, CAKE, SINA, BYI, CSTR, TSL, CAT, BA, FDX, FLS, NETL, RMBS, PCP, DLR, VMW, UNG

Losing stocks included FAZ, LVS, NFLX, NTRI, CMG, DECK, MOS, AKAM, FFIV, SKX, GMCR, POT, CRM, UAL, SOHU, NTES, WLT, TLT, CF, SLB, PCLN 

Interest rates rose, bonds moved lower, the Euro rose and the SOX closed higher +1.86% following its horizontal breakout on Wednesday.  The SOX is a leading group at this time.  The VIX moved down -1.97 to close at 19.39.

All nine sectors moved higher on Thursday with Financials XLF +2.56% and Industrials XLI +1.55% leading all sectors.

The SPX, INDU and COMPQ moved higher in a support bounce continuation move and neared their Nov highs and horizontal resistance.   The RUT, SOX and TRAN are already above horizontal resistance and finished the day with a new high close increasing the probability that the other broad indexes will break out to new highs.

NFLX, CMG, DECK and AKAM pulled back in a first day of a potential bull flag formation.

CLF, DOW, ICE, WFMI, UNP, VMW, FLWT, CTSH and ADSK broke out of horizontal resistance and another clue that the broad indexes could follow.

Although a few stocks pulled back and several more broke out to new highs the theme on many charts was a strong bounce in lagging stocks, especially evident in the charts of financial stocks.  With many of the leading stocks taking a rest the lagging stocks seemed to be the driving force behind today’s continued follow through. 

To trade an up trend focus on those stocks that institutions are buying and causing to be relatively stronger.

The big seven were again mixed on Thursday as AAPL, GOOG and QCOM moved higher, NFLX and BIDU moved lower and AMZN and PCLN were down slightly.  Continue to watch the support levels on these stocks as a key for the COMPQ staying above support.
Continue to trade with the up trend and simultaneously be prepared for any break of support.

SPX
Resistance: 1,200, 1,209, 1,220
Support: 1,190, 1,182, 1,170

Enter bullish trades with a bounce off support and a break above the high of the low day or a break out of horizontal resistance.  Thursday was an entry signal for many stocks.

Look for break of short term support for bearish entry signals or a bounce down from the 30 DMA.

The short term 3 day trend is up.
The two-month trend is up.
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 +1.75 – potential hanging man near resistance
AMZN -0.02 – hammer in bull flag
QCOM +0.60 – white candle nearing resistance in consolidation
GOOG +7.47 – white candle confirmation of inverted hammer bullish harami
BIDU -0.44 – inverted hammer near horizontal support

NDX 100 stocks stronger than the NDX include STX, FSLR, FWLT, CTSH, FAST, SBUX, MSFT, NTAP, ADSK, LOGI, KLAC, MCHP, SPLS, BIIB and APOL.

Stocks weaker than the NDX: WYNN, DTV, ESRX, CMCSA, CSCO, MICC, TEVA, JOYG, BIDU, SHLD, VRTX, GENZ, MYL, MAT and PCLN.

Stocks to Watch on Friday
Holding Above 30 DMA

HLF, PCLN,  LVS, CMG,
SINA, CAKE, CAM, UNP, WLT, ATW, SLB, NDAQ, USD, DECK, GR, VECO, CSTR, RVBD, WFMI, NFLX, BYI, MHS, NETL, FFIV, SWN, CAT, X, CREE, BUCY, GES, HAS, MCD, UNG, CLF, CRM, INFA, VMW, HANS, RMBS, SNDK, CRUS, GMCR, CF, AIV, AKAM,  ATI, PCP, POT, SKX, FCX, FDX, AKS, A, AMD, AMX, ARUN, DHR, DOW, FLS, GME, ICE, MA, PNC, SPG, TBT, UCO
Moving Above 30 DMA = 10
BAC, DE, FAS, GS, JEC, STI, SWK, URE, WHR, ZION
Moving Below 30 DMA = 2
NTRI, UAL
Staying Below 30 DMA
FAZ, TLT, SOHU, MOS, ESI, NTES, IPI, LDK, AGU, V, ACN, CHL, NYX, TSL, BA, HSY, LXK, TIE, DLR

Intermediate Term Market Trend: Up – 2 months
Short Term Market Trend: Up

1 comment:

CR said...

Thanks for your time this evening. Have a great Friday.