On Tuesday the SPX sold off to near its Nov 16 low where buyers once again took control. The SPX closed at 1,180, down -7.21 or -0.61%, the COMPQ moved down -26.99, the INDU fell -46.47. The RUT closed -4.94 well above its Nov 16 low.
Breadth weakened on Tuesday as decliners led advancers 1.96 to 1 on the NYSE and 2.05 to 1 on the NASDAQ…
Exchange NYSE NASDAQ
Advancers 1,000 873
Decliners 1,964 1,794
Index Direction Confirmation
VIX Up Yes – SPX
SOX Down Yes – COMPQ
Leading stocks on Tuesday included DECK, NFLX, FAZ, X, HAS, SKX, CAT, ZION, AKS, WFMI, AKAM, MA, PCP, BYI, CMG, MHS, TLT, GR, SLB, ATI, HSY, VMW, HANS, GMCR, CREE, MCD, FCX
Losing stocks included LDK, ARUN, TSL, SOHU, ESI, UCO, VECO, CRM, BAC, WHR, PCLN, GES, NYX, USD, FAS, LXK, UAL, SINA, A, GS, CSTR, FFIV, STI, HLF, WLT, CAM, SNDK, SWK, ACN, AMD, CRUS, TBT, NTES, CF, MOS, GME, JEC, CLF, BA, PNC, RVBD, TIE, IPI, RMBS, LVS
Interest rates moved lower, bonds moved up, the Euro moved lower and the SOX closed lower -1.27% closing below its horizontal breakout last Wednesday. The SOX is a leading group at this time. The VIX moved up +2.01 to close at 23.54.
One of nine sectors moved higher on Tuesday with Materials XLB +0.06% and Utilities XLU -0.16% leading all sectors.
The four broad indexes continued their consolidation of the past three weeks on Tuesday. The SPX is above horizontal support while the INDU is at horizontal support. The COMPQ and RUT are well above horizontal support.
Consolidation is generally a trend continuation pattern. If the support low of Nov 16 is NOT broken, look for this consolidation to ultimately resolve to the upside.
Individual stocks from our watch list like AZO, CMG, CREE, DECK, NFLX and RIMM continue to move in strong up trends.
Bull Flag Patterns include AMZN, CF, CSTR, CRUS, CRM, FFIV, GES, GR, HANS, ILMN, INFA, NETL, NTRI, ORLY, PCP, ROST, RVBD, SINA, SNDK, USD
To trade an up trend focus on those stocks that institutions are buying and causing to be relatively stronger.
Continue to trade with the up trend and simultaneously be prepared for any break of support.
SPX
Resistance: 1,190, 1,200, 1,209
Support: 1,182, 1,170, 1,156
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. Thursday was an entry signal for many stocks.
Look for break of short term support for bearish entry signals or a bounce down from the 30 DMA.
The short term 3 day trend is down.
The two-month trend is up.
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 -5.72 – black candle confirm potential hanging man close above 30 DMA
AMZN -4.09 – black candle in bull flag
QCOM -0.46 – spinning top in consolidation
GOOG -26.40 – large black candle breaks support
BIDU -2.33 – black candle close at horizontal support
NDX 100 stocks stronger than the NDX include RIMM, FLEX, ISRG, ROST, COST, SYMC, SRCL, MAT, ORLY, FSLR, SPLS, EXPD, CHRW, GENZ and SHLD.
Stocks weaker than the NDX: GOOG, FWLT, LOGI, EBAY, NIHD, YHOO, MICC, STX, WCRX, PCLN, DELL, MXIM, MYL, AMZN and QGEN.
Stocks to Watch on Wednesday
Holding Above 30 DMA
HLF, PCLN, LVS, CMG, SINA, CAKE, CAM, UNP, WLT, ATW, SLB, NDAQ, USD, DECK, GR, VECO, CSTR, RVBD, WFMI, NFLX, BYI, MHS, NETL, FFIV, SWN, CAT, NTRI, X, CREE, BUCY, GES, HAS, MCD, UNG, CLF, CRM, INFA, VMW, HANS, RMBS, SNDK, CRUS, FAZ, GMCR, CF, AIV, AKAM, ATI, PCP, POT, SKX, FCX, FDX
Moving Above 30 DMA = 2
AKS, TLT
Moving Below 30 DMA = 8
A, ARUN, DOW, GME, SOHU, TBT, UAL, UCO
Staying Below 30 DMA
AMD, DHR, MOS, SPG, AMX, FLS, DE, ESI, MA, PNC, GS, ICE, JEC, NTES, FAS, IPI, LDK, ZION, AGU, BAC, URE, V, ACN, CHL, NYX, STI, SWK, TSL, BA, HSY, WHR, LXK, TIE, DLR
Intermediate Term Market Trend: Up – 2 months
Short Term Market Trend: Neutral
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