Only
one of
nine sectors moved higher on Wednesday…XLP, XLU and XLK were the strongest sectors…while
XLV was the weakest sector.
Breadth weakened…decliners led advancers…4.09 to 1 on
the NYSE and 3.27 to 1 on
the NASDAQ.
Wednesday
– weakened , decliners led
Tuesday – weakened,
decliners led
Monday - mixed
Friday – strengthened,
advancers led
Thursday – mixed,
decliners led
SPY down 2.03 at 178.72 volume 133 million shares, above average volume
VIX up 1.51 at 15.42…
TNX up .47 at 28.44…
TLT down .80 at 103.10...
XLF down .29 at 21.11 volume
63.7 million shares, above average volume
AAPL down 4.19 at 561.36 volume 12.8 million shares
FB down .86 at 49.38…volume 62.3 million shares
Technical
Commentary:
IWM – 1.64%,
QQQ – 1.29%, SPY – 1.12%,
DIA – 0.88%.
FB +1.98,
+4.01% in after-hours trading on news that it will be added to the SP500
& SP100 after the close Friday Dec. 20.
With quarterly expiration next
Friday, tomorrow
is the last day to follow the Dec contract. This Friday switch from following the Dec
Z3 contracts to the Mar H4.
Get this…the budget deal (supposedly
a good thing) inspires worries that the Fed might taper its bond buying
program. So some traders sell and buyers
run.
Why is the Fed buying bonds each
month? The Fed has stated repeatedly they
would not reduce asset purchases until the economy was in a sustainable
recovery. The markets on May 22 started
the rumor the Fed would taper as early as June, then September and the Fed did
not.
Has the Fed proven that they will,
notwithstanding what the market rumors were, not taper until they see
sufficient economic strength by not reducing asset purchases to date?
If the Fed did begin to reduce asset
purchases would that not be a good sign of a stronger economy?
Is a stronger economy a good thing
for businesses, revenues and earnings?
Is improving revenues and earnings a
good thing for stock prices?
The reality is that on Wednesday markets did roll
over as ES breaks 1,797 and 1,783 support…SPY below 179.73 support, close
under its 30 DMA…IWM breaks 110.88, 110.37 levels and closes below Dec 4 low
and 30 DMA. As traders we need to
trade what is happening and let the markets do what they are going to
do. The VIX did jump 1.51
points and closed at its highest level since Oct 15 confirming Wednesday’s
selloff.
Friday’s bear flag setups with
charts here: http://www.chartsignals.blogspot.com/2013/12/spy-dia-iwm-and-qqq-bull-flag-bounce.html Each setup had a nice bear flag entry and move to the downside today.
Finish 2013 strong by
following your rules and begin to look for positive changes to make in 2014.
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.”
Short-term up trend chart targets:
Chart Targets:
SPY = 182.06, 183.02…Monday’s
high 181.67 within 39 cents of horizontal resistance
QQQ = 86.69, 85.77…exceeded
on Friday
IWM = 113.10, 114.39…
Short-term SPY posture is
pull back to support.
Support Levels
ES = 1,797, 1,783, 1,774
SPY = 179.93, 177.98
QQQ = 84.78, 84.11
IWM = 110.88, 110.37,
108.85
Q3 Earnings Reactions
Positive Reactions – AVGO, MFRM, 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 closed below 80.
____________________
Setups
H
Breakout: V, A, BX, DDD, GRPN,
Diagonal Breakout: BBRY, SCTY STI,
Bull Flag: QQQ, CELG, CTSH, GRMN, MAT, MU, STX, TXN, AXP, GOGO, JNPR, MFRM, SFUN, SOHU, SPLK, SWI, TIF,
Potential Bullish Divergence:
Gap Up:
Gap Down:
Bear Flag: JCP,
At Support: SPY, SYMC, XLNX, ATI, CMG, CRM, F, FAS, IBM, P, RAX, SCSS, SPWR, TSL, UAL, ZION,
C- Pattern:
Moves
New Highs: TWTR, UNG,
Gap Up:
Gap Down: CSCO,
H Breakout:
Diagonal Breakout:
Breakout Test:
Bounce: TBT, V,
MACD Divergence Bounce:
Bear Flag: ATI, NUE, BTU, WLT, SWK, Z,
Support Break: GILD, SIRI, BAC, C, CLF, DNKN, NKE, TRIP, YNDX,
______________________
8 out of 100 NDX
stocks closed higher and one was unchanged on Wednesday.
Leading NDX 100 stocks included: NUAN, XRAY, WFM,
CRMC, DLTR, SIAL, NFLX, MDLZ, AMAT
Lagging NDX stocks included: GOLD, BIDU, ISRG,
NTAP, GILD, SIRI, ALXN, MYL, VRTX, MU
Leading stocks > +2% on
Tuesday included: AAL, V, UNG
Lagging stocks < -2.0% included: P, YNDX, YOKU, TSL, WLT, SPWR, ANR,
KKD, SCTY, CRM, SOHU, CLF, FSLR, SCSS, DDD, NTES, SFUN, YELP, FAS, ATI, QIHU,
PWRD, GOGO, Z, SINA, NKE, X, JCP, UAL, ZION, ESI, TRIP, CNX, TPX, LNKD, CIEN,
CREE, SPLK, MCP, SSYS, ANGI
Stocks to Watch on
Thursday
Holding Above 30 DMA= 49
CTSH, VOD,
MSFT, AAPL, FISV, INTU, WDC, GOOG, ADP, AMZN, MAT, CA, LLTC, TXN, MU, EXPE,
NFLX, ADSK, ESRX, ALXN, MDLZ, PCLN, MNST, YHOO, QCOM, SIAL, CELG, BIIB, CMCSA, GMCR,
LBTYA, GMCR, STX, BIDU, BRCM, FB, WYNN, AVGO, EQIX, GRMN, INTC, FFIV, KRFT, PAYX,
SPLS, XRAY, TSLA, CHTR, ORLY
Moving Above 30 DMA =
0
Moving Below 30 DMA = 17
ATVI, BBBY, CHKP, CTXS,
EBAY, FAST, GILD, HSIC, MCHP, MYL, NTAP, NVDA, PCAR, SNDK, VIAB, VRSK, VRTX
Staying Below 30 DMA
ADI, CERN,
LINTA, SRCL, ADBE, AKAM, COST, KLAC, SBUX, LMCA, SHLD, SIRI, DISCA,
REGN, FOSL, ISRG, NUAN, ROST, SYMC, AMGN, DLTR, GOLD, SBAC, CHRW, FOXA, CSCO,
AMAT, VIP, WFM, CTRX,EXPD, MXIM, ALTR, XLNX
Sixteen Week
Intermediate Term Market Trend: Up
3-Day Short Term Market
Trend: Down
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