Piercing Line Tuesday as Financials Lead the Market...

DJIA + 127.83, +1.63% SP500 + 17.69, +2.13% NASDAQ Comp. + 35.64, +2.22% Russell 2000 + 17.56, +3.88% Exchange NYSE NASD Advancing 2,871 2,048 Declining 859 700 Oil $46.51 +$0.63 Gold $882.40 -$4.80 SOX 240.66 +0.47 VIX 37.14 -2.04 The VIX moved down and did confirm the move up in the SPX on Tuesday. Strongest Sectors: XLF +7.40%...XLI +2.06%...XLB +2.43% Weakest Sectors: XLV -0.95%...XLU +0.37%...XLP +1.02% Eight of nine Sectors moved higher on Tuesday led by XLF +7.40%. Financials and Industrials were stronger than the SPX. Financial stocks weaker than XLF, +7.40% include: USB, STT, AFL, SPG, WFC, PRU, TROW, C, ALL, JPM, PNC, IVZ, BAC, MET and ETF’s UYG and FAS. The Tech Sector XLK was up +1.71%. Leading tech stocks stronger than XLK +1.71%: MA, YHOO, ORCL, GLW, INTC, DELL, CSCO, HPQ, AMT, MSFT and IBM which reported earnings last night. The SOX +0.20%, was weaker than the SPX, not a sign of strength on Tuesday. Generally the SOX is a leader in a rally, however there have been times in recent weeks where it was weak on a strong rally day and then the next day it outperformed the market. Sector Watch Up Trending: Sideways: XLE, XLY, XLV, XLK, XLB Down Trending: XLF, XLP, XLI, XLU Stocks rallied after opening lower following the trading pattern of the last six weeks; one to two thrust days and one to two pause days. For each of the indices, Tuesday was a low day. Watch for continuation of the support bounce on Wednesday. Remember the six week trend is still up. Two real time virtual orders filled from our Monday night AT Webcast on Tuesday morning. Both were buy stops for options if the stocks rose. BBBY 10 May 29 calls at 2.05, options closed up 75 cents or 36%. GME 10 May 30 calls at 1.55, options closed up 25 cents or 16%. Index Commentary The DJIA formed a piercing line candle…volume was average with 424 million shares…closed above its 20, 30 and 50 DMA. The SPX formed a piercing line…closed above its 20, 30 and 50 DMA. The Nasdaq formed a bullish engulfing pattern…closed above its 20, 30 and 50 DMA. The RUT formed a piercing line pattern…closed above its 20, 30 and 50 DMA At the Open on Wednesday - Check the Charts from our earlier post... SPY – piercing line DECK – piercing line SNDA – bullish engulfing EBAY – bullish engulfing SCHN – bullish engulfing GME – morning start pattern SHLD – piercing line ADS – white spinning top in bull flag STT – bullish engulfing AG – piercing line XRT – bullish engulfing USD – spinning top URE – bullish engulfing WYNN – piercing line LEAP – hammer/bullish harami FAZ – bearish engulfing ISRG – white candle did not confirm shooting star/bearish harami Stocks to Watch on Wednesday Leading Stocks Holding Above 30 DMA BIDU, CLB, NFLX, DLTR, ICE, ALGT, DLB, JEC, PWR, VPRT, AMZN, USD, AAPL, CTSH, AXYS, BAP, CAM, GMCR, GPRO, JCOM, JOSB, ATW, GR, SYNA, EBAY, GES, SNA, ORCL, WRC, DECK, HDB, PCP, UYG, FSLR, GME, WCG, RIMM, X, BDX, BYI, CBST, EZPW, HLF, AMX, MHS, WAB, FAS, AFAM, CHL, JW.A, K, RBN, ESRX, PCLN, URE, VAR, PCR, PPD, HANS, PETS, SWN, MCD, CPLA Moving Above 30 DMA = 5 AMED, FLS, SNHY, SPWRA, JOYG Moving Below 30 DMA = 2 MYGN, STRA Staying Below 30 DMA DV, MUR, SLGN, TDG, NIHD, BIIB, MOS, NTLS, RCI, MON, WMT, GILD, BKC, APEI, BLUD, ESI, GXDX, ACN, PSYS Intermediate Term Market Trend: Neutral Short Term Market Trend: Neutral