IWM, SPY Up as Health Stocks AMGN, CELG, GILD Drop...AAPL End Near Even as FSLR Sizzles Again...

Seven of nine sectors moved higher on Wednesday…XLB, XLE, and XLI were the strongest sectors…XLV was the weakest sector.  Healthcare stocks took it on the chin as AMGN -6.94%, CELG -6.13% and GILD -5.18% pulled back in the first day of a bull flag pattern after AMGN reported revenues below expectations, better that expected EPS and in-line guidance after the close on Tuesday.  Both basic materials and energy stocks which have been weak in recent weeks made significant moves suggesting rotation into those sectors may be beginning.

Breadth weakened…however advancers still led decliners 1.93 to 1 on the NYSE and 1.30 to 1 on the NASDAQ…

Wednesday – weakened, advancer led

Tuesday – strengthened, advancers led

Monday – strengthened, advancers led

Friday – strengthened, advancers led

Thursday strengthened, decliners led

SPY up .10 at 157.88…volume 96.7 million shares

VIX up .13 at 13.61…

TNX down .05 at 16.98…

TLT up 31 cents at 122.80...

XLF up 12 cents at 18.54…volume 37.7 million shares                 

AAPL down 67 cents at 405.46…volume 34.6 million shares

FB up 13 cents at 26.11…volume 19.7 million shares

Technical Commentary:

IWM +0.52%, SPY +0.06%, DIA - 0.24% and QQQ - 0.04%.  The broad indices continue their earnings season consolidation bounce from support towards resistance on Wednesday.

IWM and SPY moved higher and DIA and QQQ paused in their support bounce.  BA gapped up and GE moved higher offsetting weakness in the DJIA.  SPY and QQQ made an entry bounce on Monday.

The Euro was up 10 pips and closed at 1.3010.   The Euro stayed above support for the eleventh straight day.

AAPL moved down 67 cents on 34.6 million shares.  AAPL reported EPS that beat but some viewed narrowing margins as a reason to sell.  In the end stock seemed to move from weaker to stronger hands.

 

FB did confirm Monday’s inverted hammer with a weak white spinning top in a potential flag setup on volume of 19.7 million shares…FB again closed just below its 30 DMA.

Trade what you see on the chart of your position.  The intermediate term trend is up with a bull flag setup.  Some stocks gave entry signals on Friday.  Look for potential entry on Monday.  Traders should lock in profits when targets are reached.  As always look for re-entry according to your rules.

Chart Signals Strategy Guidelines

Technical setups for short-term option trades be in and out by earnings release.

Over earnings release use earnings option strategies such as straddles, strangles, OTM calls or puts.

After earnings look for bullish setups in positive reaction stocks and bearish setups in negative reaction stocks.

EPS Reaction Summary

EPS Gainers – BA, BRCM, GLW, HES, DAL, COH, DD, NFLX, ILMN, VECO, LCC, RF, ZION, TRV, LMT, CAT, CHKP, HAL, HAS, CMG, GOOG, KMB, STI, MSFT, BTU, PEP, UNP, VZ, MAT, AXP, JNJ, INTC, KO, C

EPS Losers – AMGN, T, JNPR, PNRA, VMW, GE, IBM, ISRG, MCD, MS, PM, UNH, SNDK, EBAY, BAC, USB, GS, LLTC

Key Earnings this week:

Monday – CAT, CHKP, HAL, HAS, ILMN, LIFE, NFLX, TXN, VECO, ZION

Tuesday – AMGN, AAPL, ACI, T, BRCM, COH, CREE, DAL, DD, JNPR, LMT, PNRA, RF, TRV, LCC, UTX, VMED, VMW

Wednesday – AKAM, BA, COG, CLF, GLW, FFIV, DAVE, F, HES, LRCX, QCOM, TSCO, WDC, WHR, XLNX, ZNGA

Thursday – MMM, ALK, ALXN, ALTR, MO, AMZN, ABC, BIDU, BIIB, CELG, CERN, CRUS, CROX, DEC, DOW, EXPE, HOG, ESI, KLAC, LVS, MXIM, PTEN, PHM, RCL, SIAL, SBUX, HSY, TWC

Friday – CVX, DHI, GT, WLB, WY

The Market Forecast Green Line is pointed UP today.

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Setups

H Breakout:  C, FAS, WDC, SBUX, TPX, TXN, COST, YHOO, HD, DTV, ADBE, MNST, SPLK

Diagonal Breakout: NTAP, CMCSA, XLNX, SWI

Bull Flag:  VECO, TSLA, ABC, CMG, TRV, VRTX, GILD, AMGN, CELG, BIIB, UNG, GRPN, YELP, FB, MU, ORCL

Potential Bullish Divergence:  EXPD, FFIV

Gap Up: AKAM, CLF, LRCX, WDC

Gap Down: QCOM, TSCO, ZNGA

Bear Flag: GRMN, MYL, ESRX, XLNX, SHLD, CMCSA, SNDK, IBM, EBAY,

At Support:  CSCO,

Moves

New Highs:  MSFT, INTC, ABC, DD, JNJ, KO, PEP, UNP, VZ

Gap Up:  GLW, BRCM, BA, NFLX, COH, ILMN

Gap Down:  AMGN, T, JNPR, PNRA, VMW, UNH

H&D Breakout: FSLR, NUAN, WYNN, C, AKAM, LNKD, WFM, Z, RCL, ROST, TPX, DAL, NKE, SYMC, DTV, ATVI

Bounce:  X, DELL, NVDA, DDD, C, NTES, LVS, STX, GMCR, SNDK, SHLD, GRMN, LCC, SPY, SSYS, GOOG, AMZN, SIRI, SPLK, BIDU, TPX, PCLN, PM, AAPL, QCOM, FAS

MACD Divergence Bounce: ADSK, ESRX, FIVE, AMAT, FAST, MYL, ZION

Bear Flag: 

Support Break:  CTSH, ATI

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59 of 100 NDX stocks closed higher on Wednesday…

Leading NDX 100 stocks included:  GOLD, BRCM, NUAN, MSFT, NVDA, GRMN, AKAM, BMC, WYNN, DELL, CTRX, SNDK, YHOO, AMAT, CA

Lagging NDX stocks included:  AMGN, CELG, GILD, CTSH, BIIB, VRTX, ALXN, CSCO, PRGO, NWSA, EQIX, MDLZ, REGN, CERN

Leading stocks > +2% on Wednesday included: LDK, CDE, MCP, ANR, GLW, X, CLF, UCO, AKS, FCX, BBRY, SWKS, MOS, STI, NTES

Lagging stocks < -2.0% included:  JNPR, VMW, VECO, ATI, CREE

Stocks to Watch on Thursday

Holding Above 30 DMA = 53

VMED, STRZA, ADP, GILD, BIIB, MAT, PAYX, YHOO, AMGN, SBAC, ADBE, CELG, MSFT, SRCL, MDLZ, LBTYA, VIAB, REGN, VOD, BBBY, LIFE, NUAN, ROST, MNST, WYNN, CTRX, DLTR, INTC, KLAC, DTV, FISV, NWSA, SBUX, VRTX, WFM, AMZN, ATVI, COST, EXPE, EQIX, WDC, AKAM, AMAT, BIDU, DISCA, GOOG, MXIM, NTAP, NVDA, SIAL, SIRI, STX, TXN

Moving Above 30 DMA = 8

BMC, BRCM, CA, GOLD, GRMN, QCOM, SYMC, XRAY

Moving Below 30 DMA = 2

CERN, PRGO

Staying Below 30 DMA

HSIC, EBAY, ISRG, PCLN, SNDK, ALXN, CMCSA, MU, CHRW, CSCO, PCAR, SHLD, SPLS, VRSK, AVGO, CTSH, MCHP, ORLY, ADSK, DELL, XLNX, FAST, ESRX, INTU, ALTR, LLTC, ADI, AAPL, LINTA, MYL, ORCL, CTXS, FOSL, CHKP, FFIV, EXPD

Five Month Intermediate Term Market Trend: Up

Short Term Market Trend: Up