Thursday, October 10, 2013

Stocks Explode to Upside After Word of Republican Debt Proposal as Financials and Small Caps Lead, GILD, NFLX, FB Jump...

All nine sectors moved higher on Thursday…XLF, XLI and XLV were the strongest sectors…XLU was the weakest sector. 
 
Breadth strengthened…advancers led decliners…6.07 to 1 on the NYSE and 5.35 to 1 on the NASDAQ.
 
Thursday – strengthened, advancers led
Wednesday – strengthened, decliners led
Tuesday – weakened, decliners led
Monday – weakened, decliners led
Friday – strengthened, advancer led
 
 
SPY up 3.57 at 169.17…volume 195.6 million shares
VIX down 3.12 at 16.48…
TNX up .35 at 26.85…
TLT up .17 at 105.49...
XLF up .56 at 20.20 volume 76.4 million shares
 
AAPL up 3.05 at 489.64…volume 9.9 million shares
FB up 2.28 at 49.05volume 99.6 million shares
 
Technical Commentary: 
QQQ + 2.12%, DIA + 2.15%, SPY + 2.16%, IWM + 2.41%.
 
Stocks gapped higher and rose big on Thursday after news of the debt-limit proposal from Republicans.  Concerns over a potential U.S. default has risen over the past few days.  While it is considered improbable, the assessment of a default is now considered at least possible.  Today’s news suggested that a default would be averted.
 
IWM which led and SPY, DIA and QQQ all closed near their daily highs.  SPY, IWM and QQQ moved back into their recent trading range prior to Tuesday’s selloff.  Short-term posture shifts from down to neutral.    GLD closed lower for the third straight day made its lowest close since Aug 8. 
 
XLF +0.56, +2.85% had its largest daily gain in more than nine months.  Leaders included ZION, KEY and STI.
 
GILD, NFLX and FB were among NDX leaders.
 
MU reported earnings after the close on Thursday with price moving moderately lower.  JPM and WFC report Friday morning.
 
 
Resistance Chart Targets:
QQQ = 79.69
SPY = 172.76
 
Remember it is big money that creates and sustains the trend.  As Granville once wrote, “technical analysis is the art of tracking the market, following the footsteps of the ‘smart money’ crowd.  The ‘smart money crowd’ is no mysterious ‘THEY.’  It is simply a collection of people who are reading the market correctly, seeing through the maze, unconfused by this hall of mirrors.”
 
Short-term market posture is SPY down.
Support Levels
ES = 1,685, 1,672, 1,660, 1,641
SPY = 168.33, 167.08, 165.31, 164.62
QQQ = 78.40, 77.36, 76.79, 75.99
IWM = 105.82, 104.85, 103.90, 102.94
 
 
Q3 Earnings Reactions
Positive Reactions – COST, AA
 
Negative Reactions – FAST,
 
 
Chart Signals Strategy Guidelines
When the market is trending up Chart Signals looks for support bounce and resistance breakout entries. 
 
When the market is trending down Chart signals looks for resistance pull back and support break entries. 
 
When the market is sideways in consolidation Chart Signals will look for support bounce, diagonal breakouts and pull backs at resistance where price action stays between support and resistance. 
 
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.
 
 
The Market Forecast Green Line turned and is pointed up.   
 
____________________
 
Setups 
H Breakout: AMAT, CMCSA, CTSH, ESRX, GRMN, MSFT, SBUX, SNDK, STX, WDC, WFM, WYNN, ATI, DNKN, GME, UNG, VECO, YNDX,
 
Diagonal Breakout: AAPL, QCOM, XLNX, A, CLF, MFRM, PWRD, QIHU,
 
Bull Flag:
 
Potential Bullish Divergence:  
 
Gap Up:
 
Gap Down: 
 
Bear Flag:
 
At Support: GLD, UAL,     
 
Moves
New Highs: CMG, CNX,
 
Gap Up: GILD, BAC, C, F, FAS, GLW, GS, LVS, NKE, SPY, SSYS, STI, V,
 
Gap Down:    
 
H&D Breakout: X,     
 
Breakout Test: 
 
Bounce: ADBE, ADSK, AKAM, AMGN, AMZN, ATVI, BBBY, BIDU, CELG, CSCO, DTV, EBAY, FB, GOOG, INTC, NFLX, PCLN, TXN, YHOO, CREE, DDD, ESI, GRPN, LNKD, P, RAX, SOHU, SPLK, SWK, SWKS, VRSN, YELP, YOKU, ZION,
    
 
MACD Divergence Bounce: 
 
Bear Flag:  
 
Support Break:  
 
 
______________________
 
 
95 of 100 NDX stocks closed higher on Thursday.
 
Leading NDX 100 stocks included: LINTA, GILD, NFLX, CTRX, FB, ATVI, BIIB, BIDU, REGN, CELG, WDC, DTV, FOSL, AKAM, CHTR, ADBE, CERN
 
Lagging NDX stocks included:  CTXS, SHLD, GMCR
 
Leading stocks > +2% on Thursday included: GRPN, FAS, ESI, SSYS, DDD, TSL, URE, CREE, YELP, ZION, VECO, NKE
 
Lagging stocks < -2.0% included: FAZ, GMCR
 
Stocks to Watch on Friday
Holding Above 30 DMA= 31
GRMN, FB, WYNN, ADSK, AVGO, CTSH, VOD, MU, MXIM, ROST, YHOO, ADBE, DLTR, SNDK, WFM, CHTR, BIDU, MYL, SBUX, STX, AMAT, CERN, CMCSA, BBBY, MSFT, XRAY, VRSK, ISRG, AAPL, HSIC, SPLS
 
Moving Above 30 DMA = 30
AKAM, AMZN, ATVI, BRCM, CELG, COST, DELL, EXPE, FFIV, FISV, FOSL, GILD, INTC, INTU, KLAC, LINTA, ORLY, PAYX, PCAR, PCLN, SIRI, SRCL, XLNX, TXN, DISCA, REGN, SBAC, WDC, LMCA, FOXA
 
Moving Below 30 DMA = 1
SHLD
 
Staying Below 30 DMA
FAST, NVDA, TSLA, ALXN, BIIB, EBAY, VIAB, KRFT, NFLX, AMGN, CHKP, MAT, QCOM, SIAL, LBTYA, CHCRW, EXPD, GOOG, LLTC, MCHP, NTAP, ALTR, EQIX, MDLZ, ADP, DTV, CA, ADI, CSCO, CTXS, NUAN, GMCR, GOLD, ESRX, VRTX, CTRX, SYMC, MNST
 
Sixteen Week Intermediate Term Market Trend: Up
5-Day Short Term Market Trend: Neutral

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