Friday, January 11, 2013

RIMM, CTSH, GMCR, NFLX, FFIV and UNG Lead...WFC Pulls Back After EPS...


WFC -0.30, -0.85% following EPS Friday morning and MS releases on Monday.

Five of nine sectors moved higher on Friday… XLP, XLK and XLE were the strongest sectors.   XLI was the weakest sector. 

Breadth weakened on Friday as advancers led decliners…1.12 to 1 on the NYSE and 1.01 to 1 on the NASDAQ…Breadth strengthens as advancers increase and or decliners decrease.  Breadth weakens as advancers decrease and or decliners increase.

Friday – weakened, advancers led
Thursday – weakened, advancers led
Wednesday – strengthened, advancers led
Tuesday – strengthened, decliners led
Monday – weakened, decliners led


This was really Bull Flag Week.  Chart Signals listed 27 flag patterns:  CTSH, GMCR, NFLX, FFIV, IBM, YELP, SINA, NTES, WLT, SBAC, JNPR, ADI, PCAR, TXN, STX, WDC, REGN, EXPD, LMCA, QCOM, VIAB, ADBE, CRM, ADSK, IWM, NUAN, CRUS that triggeed entry signals this week and only one of those entries failed, WLT.  While no one trader is likely to enter all setups, with 26 out of 27 working it was simply a matter ignoring the chatter of opinion and exercising discipline to do well this week.

The SPY stayed above resistance on Friday.  Thursday’s SPY breakout was by only 47 cents so traders should continue to watch closely if prices rollover and be prepared to protect profits, However it appears that the uptrend is more likely to continue.

SPY down 1 cent at 147.07...volume 113.9 million shares…
VIX down -0.13 at 13.36
TNX down -0.19 at 18.75…
TLT up 1.06 at 119.85…
XLF
 down 4 cents at 17.11…volume 42.7 million shares

AAPL down -3.21 at 520.30…volume 12.5 million shares …EPS Jan 23
FB up 42 cents at`31.72…on volume of 89.6 million shares…EPS Jan 30


As earnings season continues look for stock selectivity to increase as stocks with good earnings and guidance will likely rise and those with either weak earnings or guidance likely to fall in price.  This selectivity may keep the SPY in a narrow range for the next several days.


Earnings to Watch Next Week:
Monday – MS, FCX
Tuesday – LEN
Wednesday – EBAY, GS, JPM, USB
Thursday – AXP, BAC, COF, C, FAST, INTC, UNH, XLNX
Friday – GE, JCI, SLB, STT, STI

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Technical Commentary:

The SPY formed a potential hanging man as it stayed above horizontal.  The SPY down just one cent trailed DIA +0.13% and QQQ +0.13%CRUS and RIMM broke through resistance on Friday, while a CTSH, GMCR, NFLX, FFIV and IBM bounced off support and gave fresh entry signals.  FB continued to climb from its recent breakout.

Trade what you see on the chart of your position.  If it is breaking out of resistance take the trade or stay with the uptrend according to your rules.  If the stock begins to rollover protect your profits.

The Euro followed up Thursday’s mega-bounce up another 74 pips to close at 1.3341 on Friday.  A strong Euro is generally positive for U.S. stocks.

Disk storage stocks WDC -0.41% and STX -1.16% paused.  Coal stocks ANR, ACI, BTU, CNX, JRCC and WLT moved lower.  Chinese solar stocks TSL and LDK had another pause day in their multi-week uptrend.


The Market Forecast Green Line is in the upper reversal zone. 

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Setups
Breakout:  SINA, JNPR, UNG, TXN, WDC, NUAN, CRM, QCOM, ADSK, IWM, CTRP, BRCM, RCL, NKE, EBAY, REGN, ADBE

Bull Flag:  GLW, JRCC, TRIP, CERN, ANR, ROST, DECK, FSLR, COST, ZION, ADI

Moves
Breakout: NTES, RIMM, YELP, CRUS, SPY, EXPD, LMCA, VIAB, FAS, CTXS, JOY, STX, FOSL, GILD, LIFE, FB, AMZN, TRIP, WAG, EQIX, GOOG, SNDK

Bounce:  CTSH, GMCR, UNG,  NFLX, FFIV, IBM, SBAC, PCAR

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50 of 100 NDX stocks closed higher and two unchanged on Friday…


Leading NDX 100 stocks included:  ATVI, CTSH, MNST, AVGO, FFIV, BIDU, SPLS, SNDK, NTAP, MU

Lagging NDX stocks included:  PRGO, REGN, CTRX, ALXN, CHKP, DELL, MYL, GOLD, ADBE, ROST

Leading stocks> +2% on Friday included:  RIMM, GMCR, NFLX, GRPN, NTES, COH, UAL, GES

Lagging stocks < -2.0% included:  CLF, X, CIEN, TSL, AKS, ANR, VRSN


Stocks to Watch on Monday…
Holding Above 30 DMA = 80
SBUX, CSCO, VMED, SBAC, EXPD, LLTC, PCAR, XLNX, TXN, ADI, SIAL, FISV, ADSK, DELL, FFIV, ORCL, COST, ADBE, GOOG, NWSA, DISCA, AMAT, CTSH, FOSL, KLAC, VIAB, NUAN, STX, LBTYA, WDC, ALTR, CHKP, FAST, MCHP, SNDK, EQIX, LMCA, CTXS, CHRW, INTC, SIRI, BIDU, VRSK, ADP, AMZN, BRCM, CMCSA, DTV, EBAY, EXPE, LINTA, MU, MXIM, MYL, SRCL, SYMC, VRTX, WYNN, XRAY,FB, ALXN, CA, CELG, CERN, GILD, HSIC, INTU, LIFE, PCLN, QCOM, MDLZ, CTRX, ROST, SPLS, VOD, BMC, ESRX, MAT, REGN, AVGO

Moving Above 30 DMA =1
ATVI   

Moving Below 30 DMA = 1
PRGO        

Staying Below 30 DMA
AKAM, AMGN, GRMN, NVDA, YHOO, NTAP, SHLD, ORLY, PAYX, WFM, MNST, MSFT, AAPL, BIIB, DLTR, BBBY, ISRG, GOLD

Eight Week Intermediate Term Market Trend: Up
Short Term Market Trend: Up

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