Now You Know Why I Was Singing, If I Had a Hammer...SPX Rises...



The SPX formed a large white candle that confirmed Tuesday’s hammer as it continue its support bounce from its 61.8% Fib level measured from its April 18 low and closed +11.70 at 1,340.68.  The VIX fell to 16.23 confirming the support bounce.

Each of the broad indexes confirmed Tuesday’s bullish candle and moved higher.  The SPX, INDU, COMPQ and NDX closed above its 30 DMA. 

Perhaps a few more see that complex consolidations or price channels can produce entry signals.

As I wrote yesterday, “it is important for you to see them in context of trend, support and resistance and the momentum of the Tuesday’s bullish candle, so that you can take lower risk higher return potential entries as they occur.”

I did move the stop down on Monday night’s SPY Put paper money virtual trade from $135.46 to $133.65 which was above the high of the low day and was stopped out early today with a loss.  This is consistent with what I said Monday night and what I wrote last night.

(click image to enlarge)

SPX large white candle confirms hammer, close above 30 DMA +0.88%

INDU bullish engulfing, close above 30 DMA +0.65%

COMPQ morning star, close above 30 DMA +1.14%

RUT morning star, below 30 DMA +1.60%

Breadth strengthened significantly as advancers led decliners 3.56 to 1 on the NYSE and 2.84 to 1 on the NASDAQ …

Exchange       NYSE        NASDAQ

Advancers      2,363            1,923

Decliners           663               677

Index              Chg.    Close   Direction    Confirmation

VIX                -1.32      16.23      Down          Yes – SPX

SOX              +8.11    437.59      Up               Yes – COMPQ

Leading stocks > +2% on Wednesday included VECO, ARUN, UCO, CF, SWKS, RVBD,FCX, JDSU, IPI, ATW, ANF, CRM, CAT, HUM, CLF, IAG, GMCR, PCX, SWK, VLO, TBT, FWLT,DHR, TIF, POT, NVDA, VMW, UNP, AKS, SMH, DEC, AGU, NGLS, URE, SLB

Losing stocks < -2.0% included ESI

Key Earnings this week:  ADSK, ANF, ARUN, CRM, DE, DELL, HPQ, LDK, TSL, HD, JCP, LOW, WMT, GME, SHLD, TGT

Positives – SPX, VIX, INDU, COMPQ, RUT, breadth and sectors strengthened, AAPL, AMZN, NFLX, PCLN, TNX

Negatives – TLT

Interest rates TNX +0.50 moved down and bond ETF TLT moved down -$1.28.  Financial stocks XLF rose 7 cents. The Euro moved up 12 pips to 1.4248 at 5 pm on Wednesday.

Eight of nine sectors moved higher on Wednesday.  Materials XLB +2.23%, Energy XLE +2.02% and Industrials XLI +1.58% were the strongest sectors.

Material stocks rising more than 2% included CF, MON, FCX, WY, ECL, EMN, OI, PX, AKS, APD, BLL

Many stocks that have pulled back over the past week and formed bullish candles on Tuesday created support bounce potential entry signals for some traders today. 

Support Bounce Potential Entries on Up Trending Stocks:  CERN, DLTR, ADP, EXPE, SIAL, MCHP, CHRW, CTXS, HSIC, VMED, COST, EXPD, ORLY, ALTR, DELL, LLTC, DTV, FLIR, INTC, MXIM, NTAP, AMGN, XRAY, XLNX, ERTS, VRSN, HUM, HLF, DHR, ANF, DLR, TIF, URE, VECO, GMCR, RVBD, CMG, SWN, VMW, FFIV

Up trending stocks include:  MICC, CELG, SYMC, CHKP, ILMN, LIFE, LINTA, VRTX, ROST, QCOM, FAST, NIHD, ESRX, BMC, ADSK, ADBE, WCRX, CSTR, A, V, TLT, MHS, GES, HAS, UAL, ACN

SPX

Resistance: 1,344, 1,352, 1,367

Support: 1,330, 1321, 1310

The short term 3 day trend is up.

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 +3.75 – white candle, below 30DMA

AMZN +2.28 – white candle, confirms inside day, above 30 DMA

BIDU +0.03 – spinning top, below 30 DMA

GOOG -0.65 – dragonfly doji, below 30 DMA

NFLX +5.60 – white candle confirms hammer, close above 30 DMA

PCLN +13.98 – white candle confirms hammer, below 30 DMA

QCOM +0.10 – spinning top, above 30 DMA

NDX 100 stocks stronger than the NDX include DELL, FFIV, EXPE, CERN, VRSN, BRCM, RIMM, SBUX, ALTR, JOYG, XLNX, WYNN, PCLN, NTAP and NFLX.

Stocks weaker than the NDX include MU, CTRP, SNDK, ILMN, LIFE, MCHP, JOYG, KLAC, ADSK, FLEX, AKAM, PCAR, NTAP, QGEN and ALTR.

Stocks to Watch on Thursday

Holding Above 30 DMA

HUM, HLF, CSTR, DHR, A, ANF, DLR, TIF, V, URE, TLT, MHS, GES, SMH, UNP, VECO, HAS, UAL, GMCR, RVBD, FAZ, JNPR, ACN, ICE, CMG, SWN, VMW

Moving Above 30 DMA = 8

AMD, ARUN, ATW, CF, CREE, JDSU, STI, SWK

Moving Below 30 DMA = 0

Staying Below 30 DMA

ESI, GLW, SNDK, ATI, CIEN, CRM, NYX, CHL, DOW, F, NVDA, FWLT, ZION, CAT, IL, NDAQ, SWKS, VLO, WDC, MCP, SINA, WLT, FAS, LVS, SOHU, UNG, UCO, DE, NETL, NGLS, PCX, AGU, AKS, FCX, IPI, LDK, SLB, TSL, CLF, DECK, NTES, POT, JEC, SLW, IAG, GS, CDE, TBT, MOS, X, CAM, BAC, CRUS

Intermediate Term Market Trend: Up

Short Term Market Trend: Up