Wednesday, October 27, 2010

SPX Rallies From Early Selloff Low...COMPQ Closes Higher Again...

The SPX closed down -3.19 or -0.27%, after being down more than 14 points, on Wednesday forming a hanging man candle that did confirm Monday’s shooting star and Tuesday’s hanging man…just barely …
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Semiconductor stocks BRCM, MRVL and NVLS led the COMPQ higher along with FFIV, ILMN and the resurgence of EQIX. Decliners led advancers 1.87 to 1 on the NYSE…

Exchange     NYSE    NASDAQ
Advancers    1,033       1,016
Decliners      1,935      1,635
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Index     Direction     Confirmation
VIX          Up               Yes – SPX
SOX         Up               Yes – COMPQ

Leading stocks on Wednesday included FFIV, NETL, USD, UAL, VMW, CRUS, VECO, CRM, ATI, GMCR, RVBD, BAC, AMD, LXK, SNDK, TBT, ICE, POT, ATW, GS, CAM, WLT, MA, NDAQ, BYI, UNG, PCP, NYX, INFA, RMBS, NFLX
 
Losing stocks included GES, WHR, AKS, JEC, FCX, UNP, AIV, NTES, SKX, AMX, DECK, URE, SHOU, FDX, MCD, CAKE, X, CHL, UCO, CLF, MOS, AGU, CSTR, NTRI, VOD, HANS, HSY, DOW, TLT, STI, BUCY, SINA, DE, BA, FLS, A, ZION, CAT, PCLN, IPI

Interest rates moved higher, bonds fell, the EURO was lower, the SOX exploded +3.09%. The VIX rose +0.49 at 20.71.

Just two of nine sectors moved higher on Tuesday with Technology +0.29% and Financials XLF +0.07% leading all sectors.

Charts to Watch - Flag Setups
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SPX
Resistance: 1,182, 1,190, 2,000
Support: 1,170, 1,148, 1,130

Enter bullish trades with a bounce off support and a break above the high of the low day or a break out of horizontal resistance.

The SPX Yellow Alert turned Red on Wednesday with a close below the low of the high dayjust barelysome traders may want further confirmation because of the strong close for the day...We maintain our Yellow Alert on the COMPQ looking for a close below the low of the high day. As I said in Monday night’s webcast a move below the low of the high day does not necessarily signal a major retracement, but it does signal at least a short term pull back.

A break and/or close below the low of the high day can be a potential exit for short bullish trades. Entry for a bearish signal can be a close below of the low of the high day for a counter trend trade or the same entry on a down trending stock.

The short term 3 day trend is neutral.
The three-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 of the chart and follow your rules.

AAPL -0.22 – doji
QCOM +0.54 – bullish engulfing
GOOG -2.13 –white spinning top
BIDU +0.25 – hanging man

NDX 100 stocks stronger than the NDX include BRCM, MRVL, ILMN, LIFE, LRCX, IACI, BIIB, AKAM, CTXS, CMCSA, XLNX, EXPE, ALTR, MCHP and LLTC.

Stocks weaker than the NDX: SHLD, URBN, FAST, NIHD, DISH, LOGI, RYAAY, EXPD, LINTA, AMZN, TEVA, CTSH, PPDI, JBHT and MICC.

Stocks to Watch on Thursday
Holding Above 30 DMA
HLF, PCLN, AGU, MCD, LVS, CMG, FCX, SINA, VOD, AIV, CAKE, CAM, DE, DHR, DOW, UNP, URE, WLT, A, HAS, IPI, CAT, ICE, FLS, ATW, SLB, ACN, AMX, NDAQ, UAL, USD, MA, HSY, FDX, NTRI, AMD, V, ATI, BA, DECK, GR, UCO, CF, GS, SPG, HANS, MOS, VECO, CSTR, RVBD, TBT, WFMI, NYX, FAS, NFLX, NTES, PCP, PNC, BYI, INFA, MHS, NETL, CRM, FFIV, GMCR, POT
Moving Above 30 DMA = 2
SNDK, SWN
Moving Below 30 DMA = 5
GES, JEC, SKX, WHR, ZION
Staying Below 30 DMA
CLF, LXK, CHL, STI, SWK, CREE, AKS, TIE, FAZ, RMBS, TSL, ESI, BAC, GME, CRUS, X, TLT, DLR, VMW, UNG

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Neutral

3 comments:

Val said...

Dave,
Trading can be an exciting, satisfying but sometimes lonely business and I look forward to your insights. I can’t Thank-you enough, from someone that always appreciates the time you spend teaching. Val

Judy said...

Good night DAVE! Thanks for laying out your Monday night virtual trades. It is helpful to look at your strikes and parameters. Thanks again for this post and "naming" today's $SPX candle. Hanging man doesn't sound too good. Looking forward to finding out what happens tomorrow. Judy

Aliou Sylla said...

Hello Dave,

I read your blog every day, sometimes multiple times to make sure I haven't left out crucial details. I also watch the weekend wrap-up with Tom Sosnoff. You guys are great. I would like to know how to join your virtual trades on Monday night or whenever they might be held. Thank you for sharing your knowledge with us.