Friday, February 11, 2011

SPX, INDU, COMPQ, RUT and TRAN New High Close as Up Trend Continues...

The SPX formed a bullish engulfing pattern making a new high close up +7.28 at 1,329.15 on Friday.

SPX bullish engulfing horizontal breakout new high close
INDU white candle, new high close
COMPQ large white candle horizontal breakout, new high close
RUT large white candle, horizontal breakout, new high close

Breadth strengthened on Friday as advancers led decliners 2.96 to 1 on the NYSE and 2.13 to 1 on the NASDAQ …

Exchange     NYSE     NASDAQ
Advancers     2,257       1,801
Decliners         762          844

Index     Chg.     Close     Direction     Confirmation
VIX        -0.40       15.69         Up            Yes – SPX
SOX      +3.57     462.82         Up            Yes – COMPQ

Leading stocks > +2% on Friday included JDSU, VECO, GMCR, CMG, FAS, CREE, DLR, FWLT, STI, CAT, LDK, NVDA, LCC, MOS, UAL, F, CRM, HANS, SWKS, A, HOLX, LVS, ARUN

Losing stocks < -2.0% included MCP, FAZ, NTES, TBT

Many stocks including many in our watch list either bounced off support or broke through resistance on Friday.  The trend is continuing to move higher going into expiration week starting Monday.  Stay with the trend, exit according to your rules and then look for re-entry.

Positives –SPX, INDU, COMPQ, RUT, TRAN, SOX, AAPL, AMZN, BIDU, GOOG, NFLX, PCLN, breadth strengthened, sectors strengthened

Negatives – TNX, Bonds, Euro fell

Interest rates fell on Friday and bond ETF TLT rose +1.27.  The Euro fell 54 pips to 1.3546 at 5 pm ET. 

Seven of nine sectors rose on Friday with Financials XLF +1.37% and Consumer Discretionary XLY +1.02% leading all sectors.

Resistance: 1,330, 1,338
Support: 1,321, 1,311, 1,300

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

Trade with the trend of the chart you are trading.

Bullish entry signal is a bounce off support and a break above the high of the low day or a break out of horizontal resistance.

Bearish entry signal is a break of short term support or a bounce down from the 30 DMA or other resistance.

AAPL +2.31 – white spinning top
AMZN +3.04 – larger white candle
NFLX +7.87 – large white candle
QCOM +0.60 – large white candle
GOOG +8.06 – large white candle
BIDU +3.79 – large white candle

NDX 100 stocks stronger than the NDX include WYNN, FSLR, CTRP, NWSA, NFLX, ILMN, VMED, SHLD, BIDU, NVDA, ISRG, PCAR, QGEN, NIHD and DLR.

Stocks weaker than the NDX include: EXPE, FLIR, CEPH, CSCO and TEVA.

Stocks to Watch on Monday
Holding Above 30 DMA
SINA, NDAQ, SMH, NVDA, FWLT,CLF, JDSU, CRUS, HOLX, DE, FAS, GLW, JEC, ACN, NYX, ATI, URE, DISH, POT, BA, TSL, DLR, HANS, HUM, LDK, NTES, CAM, SLB, TIE, MA, SPG, STI, CAT, DOW, MOS, NETL, SOHU, SWKS, ATW, SWK, TBT, ICE, JNPR, PCP, AGU, AMD, BAC, CF, DHR, IPI, LXK, PNC, SKX, V, ZION, ARUN, CIEN, CMG, HSY, DECK, GMCR, TIF, UAL, A, GES, RVBD, HAS, SLW, VECO, HLF, MCD, UNP, AKS, CRM, ESI, FDX, PCX, SNDK, X
Moving Above 30 DMA = 1
LVS
Moving Below 30 DMA = 1
MCP
Staying Below 30 DMA
GS, MHS, SWN, AIV, WLT, UCO, UNG, WHR, F, LCC, TLT, CHL, VMW, FCX, CREE, GME, CSTR, FAZ

Intermediate Term Market Trend: Up
Short Term Market Trend: Up

Making 2011 the best year ever!
Consistency in action is a prerequisite to consistent results.  A key reason why I am having you compare your results with market each week is the comparison requires you to see how you are doing and pushes you to draw a conclusion about your performance.  If you are not beating the market look at your trades and determine why you are underperforming and then change your actions.

If you are at the pro-rata goal or higher determine what you are doing right and resolve to continue what is working.

Week 6 is done.  Just 46 weeks left to go as we move towards our objective to make 2011our best year ever.  How did you do?
                 
Again evaluate your trades for week 5.  Did you buy, hold and sell where you were supposed to according to your rules?

The big question for this week is did you re-enter according to your rules as Chart Signals guided you?  If so, you likely increased your profits and finished the week looking good.

Give yourself an A+ or 10 for each trade that you did follow your rules.

How is your portfolio doing YTD compared with the following indexes?  If you outperformed the SOX give yourself an A+, the INDU, NDX or SPX give yourself an A.
 
                        Week 6              YTD
SPX                 1.39%               5.69%
NDX                 1.75%               7.27%
SOX                -0.06%             12.38%
INDU                1.50%               6.01%

Finally, take your annual goal that you sent in to Chart Signals and divide that goal by 52 weeks and multiply by 6.  How does your week 6 results compare to your goal?  If you are at the goal or higher give yourself and A+.

4 comments:

Brian McAllister said...

Thanks Dave. Another solid week. Looks like RUT was the leader (up 2.8%). % increase in portfolio value beat the RUT. Honored my stops, which were few because I wait until end of day so did not get hit by the a.m. Egypt volatility. Let my winners run or sold at targets. February trades are closed out so I am not going into the weekend nervous about expiration week moves. Your lessons are sinking in.

Judy said...

Good morning DAVE! Thanks so much for all of the great information. I like how you describe Bull Flag/Bear Flag entries. That is helpful. Is it possible to include a brief "Dave's C-Pattern". I can't quite remember it. I am looking at FFIV-just moved back above the 30 day MA, but is it a drop from an uptrend. Anyway, I got into CRM based on what I could remember. Thanks again for all the other GREAT information. Happy Trading! Judy

Mike said...

Hi Dave

Thanks for the continued counseling in terms of Technical Analysis and other trading advice. I am working at following my rules and eliminating emotional decision making in trading.

I plan to analyze my performance you suggested.

Mike

Judy B said...

Having already exceeded goals for the year, I'm getting a nosebleed :)
Thanks, DJ, for all your encouragement!