Fed to Continue Asset Purchases...Stocks Retreat, Bonds Rise...REGN, JRCC, Z Gain...

All nine sectors moved lower on Wednesday…XLP, XLY, and XLK were the strongest sectors…XLB was the weakest sector.

Breadth weakened…decliners led advancers 2.59 to 1 on the NYSE and 3.62 to 1 on the NASDAQ…

Wednesday – weakened, decliners led

Tuesday – weakened, advancers led

Monday – strengthened, advancers led

Friday – weakened, decliners led

Thursday – weakened/strengthened, advancers led

SPY down 1.40 at 158.28…volume 138.8 million shares

VIX up .97 at 14.49…

TNX down .36 at 16.39…

TLT up 1.26 at 124.01...

XLF down .21 at 18.49…volume 40.5 million shares                 

AAPL down 3.49 at 439.29…volume 18.1 million shares

FB down .34 at 27.43…volume 64.3 million shares

Technical Commentary:

QQQ - 0.47%, SPY - 0.88%, DIA - 0.86% and IWM - 2.42%.  Stocks pulled back and bonds TLT rose on the day the Fed indicated they would continue asset purchases until the employment showed greater strength.

QQQ, stayed above horizontal resistance.  SPY, DIA and IWM pulled back at resistance. 

The Euro rose 17 pips to short-term resistance and closed at 1.3183.   Look for a potential horizontal breakout on the Euro.

AAPL moved down 3.49 on 18.1 million shares.  AAPL held above its break out of short-term resistance from early April which a possible reversal point of its down trend since last September.

 

FB pulled back 34 cents at resistance and closed above its 30 DMA for the fourth day on volume of 64.1 million shares.  Raymond James analyst on Friday upgraded FB to Strong Buy with a price target of $37.  FB reported earnings after the close on Wednesday that beat on revenues with only a modest gain of 8 cents in after-hours trading.

Trade what you see on the chart of your position.  The intermediate term trend is up with a horizontal resistance breakout setup.  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 – ICE, JRCC, VIAB, CMCSA, DDD, AVP, HLF, CERN, CVX, DHI, TWC, ANGI, AKAM, ALXN, ALTR, BIIB, COG, CLF, CROX, DOW, ESI, FFIV, HOG, LRCX, LVS, MO, PHM, RCL, SIAL, XLNX, 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 – GRMN, MRK, SWI, AMZN, BIDU, CRUS, DECK, EXPE, HSY, KLAC, MXIM, QCOM, PTEN, ABC, MMM, AMGN, T, JNPR, PNRA, VMW, GE, IBM, ISRG, MCD, MS, PM, UNH, SNDK, EBAY, BAC, USB, GS, LLTC

Key Earnings this week:

Monday – HLF, RVBD,

Tuesday – DDD, AVP, MTW, SWI, X, VRSK, VRTX

Wednesday – AMT, ADM, CAR, CHK, CMCSA, FB, GRMN, ICE, JRCC, JDSU, LVS, MA, MRK, STX, TWX, VIAB, V, WLT, YELP

Thursday – ANR, AIG, BZH, CTRX, GM, LNKD, MDC, MYL, TPX, ZAGG

Friday – ADP, CBOE, REGN, UPL

The Market Forecast Green Line is pointed up in the Upper Zone.

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Setups

H Breakout: X, UNG, DOW, FB, CMCSA, CRUS, ESRX, SPY, FAS, LCC, PM, SPLK, VECO, ATVI, XLNX, DTV, ADBE

Diagonal Breakout: TPX, ZION, AMGN, NTAP

Bull Flag:  MNST, PHM, TSLA, HD, BIIB, DD, TPX, DECK, JCP, GRPN,  ANGI, ESI, BA, C, COST, UNP, GRMN, MYL, YHOO, KO, PEP, CMG, TRV, VRTX, GILD, CELG

Potential Bullish Divergence:

Gap Up:  STX, V, YELP

Gap Down:

Bear Flag:  CTSH, X, IBM, JNPR, ADSK, DELL, GE

At Support: MU, SNDK, EXPD, CSCO, FIVE, BIDU, VMW,

Moves

New Highs:  LNKD, INTC, TXN, OIS, ILMN, ROST, SBUX, AKAM, BBY, FSLR, MSFT, AMAT, COH, GLW, JNJ, NKE, NVDA, VZ, WYNN

Gap Up:  NFLX

Gap Down: SWI, NUAN, EXPE, MXIM, QCOM

H&D Breakout: JRCC, Z, DDD, AAPL, SSYS, BRCM, GOOG, NTES, ESRX, DAL, SYMC, DTV

Bounce: STX, WDC, HSY, ORCL, LVS, LRCX, MMM, JNPR, RCL, ABC, UNH, GMCR

MACD Divergence Bounce: FFIV, FAST

Bear Flag:  FAST, EBAY,

Support Break:  AMZN, ATI

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28 of 100 NDX stocks closed higher on Wednesday…

Leading NDX 100 stocks included:  REGN, SIRI, VIAB, LBTYA, VMED, CMCSA, ORCL, EQIX, STRZA, WFM

Lagging NDX stocks included:  FISV, GRMN, FOSL, ADSK, FFIV, GOLD, CSCO, SHLD, SNDK, MU

Leading stocks > +2% on Wednesday included: HUM, FAZ, ICE

Lagging stocks < -2.0% included:  SWI, JDSU, LDK, CLF, UCO, CIEN, CREE, SSYS, ATI, TSL, FAS, VECO, BBRY, AKS, MCP, X, YELP

Stocks to Watch on Thursday

Holding Above 30 DMA = 64

STRZA, ADP, GILD, BIIB, MAT, PAYX, YHOO, SBAC, ADBE, MSFT, SRCL, MDLZ, REGN, VOD, BBBY, LIFE, ROST, MNST, WYNN, CTRX, DLTR, INTC, DTV, NWSA, SBUX, VRTX, WFM, ATVI, COST, WDC, AKAM, AMAT, GOOG, NVDA, SIAL, SIRI, STX, TXN, BMC, BRCM, CA, SYMC, ALXN, ESRX, ORLY, PCAR, XLNX, CERN, CMCSA, FB, AAPL, CHRW, FOSL, KLAC, LINTA, MCHP, XRAY, VRSK, CHKP, ORCL, SHLD, VIAB, EQIX

Moving Above 30 DMA = 2

VMED, LBTYA

Moving Below 30 DMA = 11

ADSK, CELG, CSCO, FISV, GOLD, GRMN, LLTC, MYL, NTAP, SPLS, PRGO

Staying Below 30 DMA

AMGN, FAST,NUAN, DISCA, AMZN, BIDU, EXPE, MXIM, PCLN, QCOM, HSIC, EBAY, ISRG, SNDK, MU, AVGO, CTSH, DELL, INTU, ADI, ALTR, CTXS, FFIV, EXPD

Five Month Intermediate Term Market Trend: Up

Short Term Market Trend: Neutral