Wednesday, January 9, 2013

STX, WDC, FB Jump...Solar Stocks TSL, LDK Sizzle...AAPL Weak Following AA Earnings...


The SPY continued to pause at the start of earnings season.  AA closed down 2 cents after it met EPS and exceeded on revenues Tuesday after the close.  WFC releases earnings Friday morning.

Six of nine sectors moved higher on Wednesday… XLV, XLI and XLB were the strongest sectors.   XLU was the weakest sector. 

Breadth strengthened on Wednesday as advancers led decliners…2.14 to 1 on the NYSE and 1.87 to 1 on the NASDAQ…Breadth strengthens as advancers increase and or decliners decrease.  Breadth weakens as advancers decrease and or decliners increase.

Wednesday – strengthened, advancers led
Tuesday – strengthened, decliners led
Monday – weakened, decliners led
Friday – strengthened, advancers led
Thursday – weakened, advancers led


The SPY moved sideways and traded in a very tight 68 cent range.  Though the SPY has moved sideways for six days, the Jan 2 gap support continues to hold.  At resistance traders should continue to watch closely for prices to rollover and be prepared to protect profits, while at the same time be prepared to continue with the uptrend if a breakout of resistance occurs. 

As earnings season begins look for stock selectivity to increase as stocks with good earnings and guidance will likely rise and those with either weak earnings or guidance likely to fall in price.  This selectivity may keep the SPY in a narrow range for the next several days.


SPY up 37 cents at 145.92...volume 90.7 million shares…
VIX up .19 at 13.81
TNX down .19 at 18.52…
TLT down 11 cents at 119.12…
XLF
 down 3 cents at 16.93…volume 48.5 million shares

AAPL down 8.21 at 517.10…volume 14.5 million shares …
FB up 1.53 at`30.59…on rising volume of 104.6 million shares…

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Technical Commentary:

The SPY formed a doji candle pattern as it continues to trade sideways for the sixth straight day holding above the 145 gap support area.  IWM rose 42 cents on Wednesday, formed a spinning top and continues to lead the broad index ETFs.  CTXS and JOY broke through resistance on Wednesday, while a large number of stocks bounced off support and gave fresh entry signals.  FB continued to climb from its recent breakout.

Trade what you see on the chart of your position.  If it is breaking out of resistance take the trade or stay with the uptrend according to your rules.  If the stock begins to rollover protect your profits.

The Euro dropped another 47 pips to close at 1.3033 on Wednesday.

Disk storage stocks WDC +4.34% and STX +6.64% bounced big in their bull flag patterns.  Coal stocks ANR, ACI, BTU, CNX, JRCC and WLT all continued weak on Wednesday.  Chinese solar stocks TSL and LDK continued to soar in their multi-week uptrend, after spending 2012 in a strong down trend.


The Market Forecast Green Line is in the upper reversal zone. 

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Setups
Breakout:  CRUS, NUAN, QCOM, CTRP, SPY, BRCM, RCL, ACI, BTU, JRCC, NKE, MCP, EBAY

Bull Flag:  NFLX, CERN, WLT, SBAC, ANR, ROST, FFIV, CIEN, GLW, IBM, JNPR, DECK, FSLR, GMCR, CTSH, ADI, PCAR, TXN, COST, ZION, YELP

Moves
Breakout: CTXS, JOY, FOSL, GILD, LIFE, FB, AMZN, TRIP, WAG, EQIX, GOOG, SNDK,

Bounce:  STX, WDC, REGN, EXPD, LMCA, QCOM, VIAB, ADBE, CRM, ADSK, IWM

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70 of 100 NDX stocks closed higher on Wednesday…


Leading NDX 100 stocks included:  STX, FB, WDC, REGN, CTXS, BIDU, MAT, ALXN, LIFE, DTV

Lagging NDX stocks included:  GRMN, NVDA, DLTR, SBUX, YHOO, EXPE, AAPL, NUAN, AKAM, ORLY

Leading stocks> +2% on Wednesday included:  TSL, LDK, FB, WDC, HLF, DHR, SWI, SWKS, SSYS, A, VMW, LNKD, CREE

Lagging stocks < -2.0% included:  ESI, BAC, ANR, DECK, RIMM, GPN, JDSU


Stocks to Watch on Thursday…
Holding Above 30 DMA = 78
SBUX, CSCO, VMED, SBAC, EXPD, LLTC, PCAR, XLNX, TXN, ADI, SIAL, FISV, ADSK, DELL, FFIV, ORCL, COST, ADBE, GOOG, NWSA, DISCA, AMAT, CTSH, FOSL, KLAC, VIAB, NUAN, STX, LBTYA, WDC, AKAM, ALTR, CHKP, FAST, MCHP, SNDK, EQIX, LMCA, CTXS, CHRW, INTC, SIRI, BIDU, VRSK, ADP, AMZN, BRCM, CMCSA, DTV, EBAY, EXPE, LINTA, MU, MXIM, MYL, SRCL, SYMC, VRTX, WYNN, XRAY, PRGO, FB, ALXN, CA, CELG, CERN, GILD, HSIC, INTU, LIFE, PCLN, QCOM, MDLZ, CTRX, ROST, SPLS, VOD, BMC

Moving Above 30 DMA = 4
AMGN, ESRX, MAT, REGN 

Moving Below 30 DMA = 3
GRMN, NVDA, YHOO                         

Staying Below 30 DMA
ATVI, NTAP, SHLD, ORLY, PAYX, WFM, MNST, MSFT, AAPL, BIIB, DLTR, BBBY, ISRG, AVGO, GOLD

Seventeen Week Intermediate Term Market Trend: Neutral at Resistance
Short Term Market Trend: Neutral

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