SP500 1,157.44 -14.23 -1.21%
COMPQ 2,394.36 -30.66 -1.26%
Russell 2000 709.11 -6.26 -0.87%
Exchange NYSE NASD
Advancing 1,091 990
Declining 1,984 1,735
Oil $74.95 -0.70
Gold $1,228.90 -13.90
SOX 364.96 -10.12
VIX 26.68 +1.16
Index Direction Confirmation
VIX Up Yes – SPX
SOX Down Yes – COMPQ
Strongest Sectors: XLU -0.43%…XLP -0.61%...XLE -0.64%
Weakest Sectors: XLY -2.24%...XLF -1.81%...XLI -1.55%
All nine sectors moved lower on Thursday. Utilities, Consumer Staples, Energy, and Healthcare were stronger than the SPX -1.21%.
Sector Watch
Up Trending: XLY, XLI, XLP, XLF
Horizontal Breakout:
Sideways: XLK, XLE, XLB, XLV, XLU
Down Trending:
The four broad indexes SPX, INDU, COMPQ and RUT all formed a bearish harami on Thursday. While this candle pattern has no implications for the long term or intermediate term trend, it can signal the end of the short term up trend since Monday or what can also be called a pull back or correction.
I call the potential end of a short term trend a Yellow Alert. It can be an exit signal for short term trend continuation trades, an entry into a counter trend trade or and entry into a bearish position in a stock that is forming a lower high or is below or moving below its 30 DMA.
These indexes, as well as many stocks, can also be viewed as forming a potential bear flag price pattern.
The exit signal would be either confirmation, a close below the body, of the bearish candle, a break of the rising support line of the flag pattern or a move/close below the low of the high day.
If price does not break below the support of the candle, flag or low of the high day, there is no entry signal and the short up trend is consolidating and will likely continue. We will be watching on Friday for a an actual signal to exit short term bullish trades or entry signal for short term bearish trades.
Look at these Charts
(click image to enlarge)
Guidance:
The SPX reversed on Thursday and closed lower after reaching it 61.8% Fib retracement from its April 26 high and last Friday’s low. Wednesday’s low and Monday’s S1 at 1,140 are short term candle support levels.
The SPX reversed on Thursday and closed lower after reaching it 61.8% Fib retracement from its April 26 high and last Friday’s low. Wednesday’s low and Monday’s S1 at 1,140 are short term candle support levels.
On Friday we will look for a potential break of short term support or potential continuation of the support bounce and a potential move to the 1,178 resistance area which is the 127.2% Fib extension from the 1,150 horizontal breakout in mid March.
Trade strong stocks up. Look for entry signals into support break on Friday.
Trade weak stocks down.
The VIX rose +1.16 and closed at 26.68 after reaching a low of 24.30.
The short term trend is neutral.
The six-month trend is neutral.
The twelve-month trend is up.
Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend and follow your rules.
Adjust your stops according to your rules for up and down trending trades.
AAPL -3.73
QCOM -0.20
GOOG +5.49
BIDU -2.56
NDX 100 stocks stronger than the NDX include: STLD, ERTS, IACI, GOOG, AKAM, CTXS, WCRX,EBAY, INFY, LBTYA, NIHD, CEPH, CHKP, NVDA, CA, GENZ, EXPE, COST, PCAR, CERN, ESRX, QCOM, FLIR, JOYG, MSFT and VRTX.
Stocks weaker than the NDX: URBN, FISV, CSCO, XLNX, AMAT, SHLD, SPLS, MRVL, BBBY, BIDU, ALTR, GRMN, BRCM, RIMM, KLAC, MICC, ROST, HANS, INTC, LINTA and STX.
Stocks to Watch on Friday
Holding Above 30 DMA
NFLX, WHR, AIV, OSTK, ICE, EXBD, NTRI, BYI, CRM, DHR, GR, HAS, HLF, MCD, PNC, SNDK, SPG, STI, SWK, URE, UNG, WFC, WFMI, ZION, AMD, ATI, CAT, CREE, DECK, LVS, UNP
Moving Above 30 DMA = 1
FAZ
Moving Below 30 DMA = 4
BA, DE, JEC, LXK
Staying Below 30 DMA
CHL, GME, SYNA, HANS, WMT, ACN, MYGN, AMX, BKC, DOW, FAS, FLS, PCLN, PCP, TSL, UAUA, USD, USO, UYG, ATW, BAC, GES, MA, V, CAM, SWN, BUCY, WLT, CLF, MHS, WCG, ESI, GMCR, GS, FCX, X, PWRD, AGU, IPI, POT, MOS
Intermediate Term Market Trend: Neutral
Short Term Market Trend: Neutral
2 comments:
Wow, Dave! Lasts nights AIT was exactly what I needed to hear to learn "how to handle the turn", potentially!!
The details were impecable, IMhO. Recall, I got killed on the last 2 turns (Jan & Apr) and maybe again on this one too. Because I bought every STerm entry signal that appeared (meeting my risk per trade rules, etc) this week. And now i'm in trade entries from Wed & Thurs a.m. that all have small losses going into Fri a.m.
I'll be around a long time--have MUCH to learn!!
Thank you for all your sacrifices to be our Mentor/Instructor,
Scott L (Lorenz) of Nashville
Thank you Dave..Just what we need to prepare for today...One question..... On today's blog after you have highlighted in yellow the phrase "forming a potential bear flag price pattern" . In you next sentence do you mean to say "the entry signal would be" instead of "the exit signal would be"? Just want to make sure.
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