Monday, January 5, 2015

Stocks Take The Plunge...Largest Loss In Three Months...Oil/Crude At 5 1/2 Year Low...Numerous Stocks Have Bull Flags...

All nine sectors moved lower on Monday…XLV, XLP and XLU were the strongest sectors and XLE was the weakest.
 
Breadth was weakened as decliners led advancers 3.35 to 1 on the NYSE and decliners led advancers 2.44 to 1 on the NASDAQ.

Monday – weakened, decliners led
Friday – strengthened, mixed
Thursday – New Year’s Day Holiday
Wednesday – mixed, decliners led
Tuesday – weakened, decliners led


SPY down 3.29 at 202.14 on 169.2 million shares, above average volume
VIX up 2.13 at 19.92…
TNX down .84 at 20.39…
TLT up 2.07 at 129.39...
XLF down .51 at 24.22 on 40.9 million shares, above average volume

AAPL down 2.93 at 106.40 on 64.2 million shares, above average volume
FB down 1.12 at 77.33…on 26.3 million shares

Technical Commentary:
IWM – 1.10%, QQQ – 1.31%, SPY – 1.60%, DIA – 1.65%.


Look for bull flag setups in stocks that are up trending or reversal breakouts from stocks that recently pulled back.

Trade with the trend of the chart you are trading and continue to move your profit protection stops.  Continue to follow your rules.


Presidential Term Cycle

2015 is the third year of the presidential term.  Since 1945 there have been 17 complete presidential terms through 2012.  This four-year period has become known as the Presidential Term Cycle (PTC).  The third year is the only year of the PTC that has produced a positive return in the SPX 100% of the time since 1945Here is the summary performance of the SPX for each of the four calendar years in the PTC.

Year   Up Years       Avg. Annual Return
1          59%                10.43%
2          65%                  9.42%
3          100%              19.98%
4          82%                10.05%

While the future is never determined by the past, the past does give us context for forming a realistic expectation of the present rather than just making a subjective guess, which way too many commentators do.

While the average return for the third year was 19.98%, not one of the third years produced a 19.98% return.  The range of returns was 2.07% to 38.46%Four of the years had returns from 2.07% to 5.69%Three of the years returned from 11.59% to 18.69%Ten of the years produced returns from 21.11% to 38.46%.

Chart Signals expects the combination of improving macro-economic environment and this historical cycle, which has been largely influenced through the decades by an accommodative Fed policy during the third year in an effort to produce a positive economic environment during an election year, to produce a continuing up trend during 2015.  Investors will need to trade the actual market action as it unfolds during the year whether it is up, sideways or down.


Short-term Chart Targets:
SPY = 207.33, 209.06, 210.49...
QQQ = 106.94
IWM = 119.90, 121.88, 124.07…
Support Levels
SPY = 207.33, 204.24...
QQQ = 103.08, 102.40
IWM = 118.34, 116.15...


Q3 Earnings Reaction
Positive Reactions – ADBE, CIEN, LULU, AVGO, ADI, HPQ, PANW, QIHU, ADSK, JASO, ROST, SPLK, GOGO, RAX, NTES, XONE, YOKU, VJET, BABA, MNST, WFM, ABC, ACI, AMGN, BIDU, BWLD, CBOE, CLF, CLX, CNX, EA, ESRX, EQIX, EXPE, FISV, GLW, GPRO, GRPN, GT, HSY, JCI, JDSU, LNKD, LVLT, MA, MAR, MO, MTW, MYL, PCAR, FE, SCHN, STX, SWI, SWKS, TASR, V, WY, X, WHR,  AAPL, ALK, ALXN, APOL, BMY, BRCM, CAT, CELG, CERN, CHKP, CMCSA, CNI, EMC, EW, GD, HAL, HAS, HOG, ILMN, IM, KLAC, KMB, LLY, LRCX, LXK, MMM, MXIM, MSFT, N, ORLY, PG, RMD, STLD, STT, SWK, TRV, TSCO, TXN, UNP, VRSN, WOOF, YHOO, YNDX, ZION, AMD, C, CSX, DAL, GE, HON, LVS, MS, SCHW, SLB, STI, URI, XLNX, COST, BBBY, BBRY, MU, NKE, PAYX, LULU, PANW, ULTA, MFRM, SPLK,

More than 10% - GOGO, RAX, WFM, GPRO, GPRN, LNKD, BWLD, SWI, N, EW, TSCO, NKE, ULTA, LULU, PANW, MFRM,

Negative Reactions – COST, AMBA, MFRM, GME, CRM, JD, MBLY, SINA, YY, SWKS, FEYE, FSLR, PCLN, QCOM, TRIP, SCTY, SSYS, SUNE, UBNT, Z, ZU, AEM, CHRW, COH, FB, GRMN, KRFT, MDC, MRK, NEM, PNRA, RGR, SLCA, TPX, TWTR, ALTR, AMZN, BA, BTU, CMG, CREE, DECK, DNKN, DOW, EAT, F, GM, IBM, JNPR, KO, LMT, LUV, NDAQ, P, UA, VMW, XRX, YELP, AXP, BAC, COF, EBAY, GOOGL, INTC, JNJ, JPM, KEY, MAT, NFLX, WFC, AZO, ADBE, KKD, CIEN,

More than -10% - GME, CSIQ, FSLR, UBNT, ZU, AEM, P, TPX,

Reversal in progress – PCLN, TPX, KO,

Reversal of Initial Reaction – AMZN, FEYE, SWKS, Z, ADBE, ALTR, ALTR, AXP, AZO, BA, BAC, BTU, CHRW, CMG, COF, COH, CREE, DECK, DNKN, DOW, EAT, EBAY, F, GM, GOGO, GOOGL, GRMN, INTC, JNJ, JNPR, JPM, KEY, KKD, KO, KRFT, LMT, LUV, MAT, MDC, MRK, NDAQ, PNRA, UA, VMW, WFC, XRX,

The SPX Market Forecast is at 73.

___________________

Setups  
Diagonal Breakout: MBLY,  
Bull Flag: BAC, CAR, CIEN, DAL, ETFC, GLW, HPQ, IWM, JNPR, LNKD, MS, RAX, RCL, SCHW, SPY, UAL, V, COST, EA, ESRX, QCOM, ROST, STX, WDC, WFM,  
At Support: NKE, ANR, P, SSYS, TPX, AAPL, BIDU, GMCR, MAR, NTAP,    

Moves  
D Breakout: JD, LOCO
Bounce: FEYE, GME, PANW, YY
Gap Down: ATI
Support Break: AA, BABA, BBY, EXPE, UA, X, Z, FSLR, TBT, ZU, GRMN, SNDK,

______________________


8 out of 100 NDX stocks closed higher on Monday.


Leading NDX 100 stocks included: ILMN, GILD, MNST, REGN

Lagging NDX stocks included: VIP, NFLX, LBTYA, CHRW, TSLA, DISCA, PCLN, CHTR, VOD, NTAP, PCAR, CTRX, AMAT, EXPD

Leading stocks > +2% on Monday: JD, FEYE, JCP, PANW

Lagging stocks < -2.0% included: MTW, CSIQ, ATI, Z, SCTY, AA, FAS, SPWR, JASO, SUNE, X, TSL, YELP, CREE, ZION, LC, CAR, STI, SCHW, SPLK


Stocks to Watch on Tuesday
Holding Above 30 DMA = 20
ROST, DLTR, AAL, SPLS, BBBY, EA, WFM, AVGO, WDC, SIAL, BIIB, CHKP, FAST, KRFT, QCOM, CERN, ESRX, VRTX, NXPI, CA

Moving Above 30 DMA = 2
ILMN, MNST

Moving Below 30 DMA = 33
ADI, AKAM, AMAT, BRCM, CELG, CHRW, CHTR, CMCSA, COST, CSCO, CTRX, DISCA, DTV, EBAY, FB, FOXA, HSIC, ISRG, KLAC, LBTYA, LLTC, LVNTA, MAR, NFLX, ORLY, PCAR, PCLN, SBUX, SRCL, TRIP, TSCO, VIAB, VRSK                                     

Staying Below 30 DMA
ADSK, EXPD, FISV, MAT, MU, STX, ADBE, ALTR, CTSH, CTXS, DISH, EQIX, GOOG, INTC, INTU, LMCA, MYL, SIRI, SYMC, TXN, YHOO, AAPL, ADP, LRCX, NVDA, REGN, MSFT, NTAP, PAYX, SNDK, AMGN, VOD, GILD, XLNX, MDLZ, ALXN, ATVI, SBAC, AMZN, GRMN, BIDU, TSLA, VIP, GMCR, WYNN

6-month Intermediate Term Market Trend: Up

3-day Short Term Market Trend: Down

No comments: