SPX & INDU Close Higher, NDX & RUT Close Lower...

Following earnings after the close on Thursday GOOG gapped higher and closed lower while ISRG gapped higher and closed higher on Friday.

The SPX formed a doji that confirmed Thursday’s large tail hammer to close up +3.09 at 1,283.35 on Friday.

(click image to enlarge)

SPX doji confirmed long tailed hammer in bull flag

INDU white candle breakout confirmed long tailed doji in bull flag

COMPQ black candle at support of hammer tail in bull flag

RUT black candle lower low again closed below 30 DMA

Breadth strengthened turned positive on Friday as advancers led decliners 1.10 to 1 on the NYSE but remained negative as decliners led advancers 1.43 to 1 on the NASDAQ…

Exchange       NYSE          NASDAQ

Advancers      1,590             1,084

Decliners        1,433              1,560

(click image to enlarge)

Index              Chg.    Close    Direction      Confirmation

VIX                 +0.48      18.47    Up                  No – SPX

SOX                -3.12    431.65    Down             Yes – COMPQ

Leading stocks > 1% on Friday included STI, IPI, ESI, ZION, WHR, FAS, RVBD, LDK, VMW, POT, HLF, NDAQ, HANS, GMCR, NTES 

Losing stocks < -1% included AMD, MCP, WLT, VECO, CLF, SOHU, DECK, ARUN, TIE, FAZ, FCX, SLB, CREE, PCX, BAC, CF, UAL, PCP, X, CSTR, SINA, AKS, ATI, GES, TBT

Positives – INDU, SPX, XLF, Euro, strengthening breadth and sector strength, bull flag price pattern

Negatives – NDX, RUT, SOX, TNX, bonds, AAPL, AMZN, BIDU, GOOG, NFLX, PCLN, negative advancers/decliners on NASDAQ

Interest rates moved lower on Friday and bonds moved higher.  The Euro moved up 144 pips to 1.3618 at 5 pm ET. 

Six of nine sectors rose on Friday with Industrials XLI +0.81% and Financials XLF +0.81% leading all sectors.

Dave’s Insight:  Look for re-entry by indentifying the setup and WAIT for the entry signal according to your rule.

IBM earnings helped lift the INDU this week which made a new high close on Friday.  A large number of INDU stocks will report next week.  Watch the institutional reaction to the earnings as a major catalyst for the next short term move, up or down.

Earnings

Mon – AXP, MCD, VMW, ZION

Tue – ALTR, DD, AKS, JNJ, TRV, VZ, X

Wed – AMZN, MSFT, SNDK, KLAC, MMM, PG, T, F, RVBD, CRUS, GMCR, BMC, PCP, UAL

Thu – BA, CAT, CTXS, LRCX, NFLX, QCOM, SWK, UTX

Moves on Friday

Resistance Breakout – HANS, HPQ, MS

Bull Flag Bounce – FAS, NDAQ

MACD Divergence Bounce –

Setup Charts to Watch on Monday

Bull Flag Setups – MYL, DISH, DTV, XLNX, LLTC, NVDA, SMH, SINA, INTC, F, GM, A, DE, NYX, PNC, BK, SID, FWLT, LDK, MCP, PCX, TIE, WLT, CLF, UNP, HUM, HSY, MHS, JOYG, AMD

Breakout – UNG, IBM, ACN, ESI

MACD Divergence – GES, GME, HAS, NKE, HNZ

SPX

Resistance: 1,281, 1,300

Support: 1,256, 1,241, 1,220

The short term 3 day trend is neutral.
The six-month trend is up.
The twelve-month trend is up.

Trade with the trend of the chart you are trading.

Bullish entry signal is a bounce off support and a break above the high of the low day or a break out of horizontal resistance.

Bearish entry signal is a break of short term support or a bounce down from the 30 DMA or other resistance.

 

AAPL -5.96 – large black candle close below 30 DMA

AMZN -4.54 – large black candle below 30 DMA, breaks horizontal support

NFLX -2.91 – black candle inside day close below 30 DMA

QCOM -0.10 – black spinning top

GOOG -14.94 – bearish engulfing pattern

BIDU -0.56 – black candle in bull flag

NDX 100 stocks stronger than the NDX include ISRG, NWSA, VMED, MU, MXIM, CMCSA, VOD, FFIV, SRCL, CTRP, ORCL, COST, SPLS, PAYX and ADSK.

Stocks weaker than the NDX: ERTS, BIIB, AKAM, FLEX, ATVI, AMZN, EBAY, GOOG, APOL, JOYG, AAPL, CHKP, SHLD, MYL and MRVL.

Stocks to Watch on Monday
Holding Above 30 DMA
SINA, NDAQ, SMH, FWLT, PCX, CLF, CRUS, HOLX, A, DE, FAS, JEC,  ACN, BAC, NYX, ATI, CF, URE, AGU, POT, UNP, BA, SWN, UNG, TBT, TSL, DLR, GMCR, HANS, HUM, HSY, LDK, MHS, NTES, CAM,  SLB, TIE, ATW, SKX, MA, SPG, CHL, ESI

Moving Above 30 DMA = 5

IPI, SWK, STI, WHR, ZION

Moving Below 30 DMA = 6

CAT, PCP, PNC, SOHU, VECO, WLT

Staying Below 30 DMA
ARUN, CMG, CRM, DHR, DOW, FDX, MOS, NETL, RVBD, SNDK, UCO, VMW, AIV, FCX, GS, LVS, LXK, MCP, UAL, DECK, AMD, HLF, CREE, X, AKS, GME, ICE, GES, TLT, HAS, V, CSTR, MCD, FAZ

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

Making 2011 the best year ever!

Week 3 is done.  Just 49 weeks left to go as we move towards our objective to make 2011our best year ever.  How did you do?

                 

Again evaluate your trades for the week.  Did you buy, hold and sell where you were supposed to according to your rules?

The big question for this week is did you move your stops up according to your rules as Chart Signals guided you early in the week?  If so, you likely protected your profits and finished the week looking good.

Give yourself an A+ or 10 for each trade that you did follow your rules.

How is your portfolio doing YTD compared with the following indexes?  If you outperformed the SOX give yourself an A+, the INDU, NDX or SPX give yourself an A.  If you outperformed the INDU for the week give yourself an A+.

                        Week 3            YTD

SPX                 -0.76%             2.04%

NDX                 -2.37%             2.28%

SOX                -4.42%             4.82%

INDU                 0.72%             2.54%

Step 3 take your annual goal that you sent in to Chart Signals and divide that goal by 52 weeks and multiply by 3.  How does your week 3 results compare to your goal?  If you are at the goal or higher give yourself and A+.