IWM Harami Flag Setup, QQQ, AAPL, PCLN Lower as SPY Pauses on Visible Rotation in Stocks on Friday...

Three of nine sectors moved higher on Friday…XLF, XLI and XLV were the strongest sectors…while XLK was the weakest sector. 

Breadth strengthened as advancers led decliners…1.83 to 1 on the NYSE and 1.63 to 1 on the NASDAQ.

Friday – strengthened, advancers led

Thursday – weakened, decliners led

Wednesday – New Year’s

Tuesday – strengthened, advancers led

Monday – weakened, decliners led

SPY down .03 at 182.89 volume 81 million shares, below avg. volume

VIX down .47 at 13.76…

TNX up .10 at 29.95…

TLT unchanged at 102.17...

XLF up .15 at 21.89 volume 24.7 million shares, below avg. volume

AAPL down 12.15 at 540.98 volume 14 million shares, above avg. volume

FB down .15 at 54.56…volume 38.3 million shares, just 58% of avg. volume

Technical Commentary: 

IWM +0.51%, DIA +0.17%, SPY -0.02%, QQQ -0.72%.

The holiday shortened week finished with another below average volume day and the SPY’s first lower weekly close since Friday, Dec 13.  The SPY was down a moderate 95 cents for the week.  Small caps IWM bounced in a bull flag pattern while QQQ finished lower for the second straight day.

Even though the SPX was near unchanged VIX fell which is technically positive for a potential trend continuation support bounce.

Overall the economic outlook continues to strengthen and Friday’s technical evidence indicates that institutions are still net buyers although rotational selling in stocks like AAPL, PCLN, NFLX, COST, PG and EBAY was noticeable.  Net buying for the week continued in stocks like BBBY, AXP, DIS, GS, IBM, JPM, DTV, FOXA, VIAB, INTC, STX, BIDU, CTXS, GMCR and WYNN.      

Even though the Euro continued to move lower on Friday, interest rates TNX rose slightly, TLT bonds were unchanged and financial stocks were among the leaders with gains in C, BAC, STT, JPM, WFC, GS, MS, and ETFC among others.

Chart Signals is looking for a potential support bounce next week as markets head into the start of earnings season.

Trade with the trend, move your protective stops. Continue to follow your rules.

Remember it is big money that creates and sustains the trend.  As Granville 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 up trend Chart Targets:

SPY = 184.69, 186.06, 186.90…

QQQ = 87.79, 88.74…

IWM = 115.97, 116.70, 118.54…

Q4 earnings season unofficially starts next Thursday, January 9 with the AA earnings release after the close.

Tuesday – APOL, MU

Wednesday – BBBY, MON, SCHN

Thursday – AA, FDO,

Q4 Earnings Reactions

Positive Reactions –

Negative Reactions –

The Market Forecast Green Line is above 80.

____________________

Setups 

H Breakout: AAL, BBRY, C, CREE, DAL, ESI, FAS, FSLR, GRPN, MFRM, NKE, SPLK, SCTY, STI, UAL, VECO, YELP, YOKU, Z, ZION, ATVI, GILD, GRMN, STX,

Diagonal Breakout: ANR, CMG, CRM, DNKN, KKD, QIHU, YNDX, ADBE, CELG, MU, WDC,

Bull Flag: A, ATI, CIEN, CLF, DRYS, GME, IBM, JCP, LVS, NTES, RAX, RCL, SCSS, SFUN, SINA, SOHU, SPY, IWM, TIF, V, WLT, X, ADSK, AKAM, BIDU, BRCM, CMCSA, CSCO, CTSH, FB, GMCR, GOOG, NFLX, QCOM, SNDK, TSCO, TSLA, TXN, WYNN, XLNX, YHOO

(click image to enlarge)

Potential Bullish Divergence: GOGO, TRIP,  

Gap Up:

Gap Down:

Bear Flag: 

At Support: LNKD, SWKS, TLT, UNG, AAPL,

C- Pattern: ROST,

Moves

New Highs: BAC, BX, CSIQ, DDD, GLW, GS, JNPR, SSYS, SWI, TPX, XONE, BBBY, DISH, DTV,

Gap Up:         

Gap Down:      

H Breakout: ALK, SPWR, TSL, UAL, XONE, VJET,

Diagonal Breakout: AAL, C, DAL,

Breakout Test: SCTY, VRSN,

Bounce: FSLR, TWTR, ATVI, GMCR, STX,

MACD Divergence Bounce: ESI, FIVE, GLD, P, GRMN,

Bear Flag: 

Support Break: EBAY, PCLN

______________________

33 out of 100 NDX stocks closed higher on Friday.

Leading NDX 100 stocks included: GRMN, MXIM, STX, SIRI, GMCR, YHOO, SPLS, ATVI, MNST, ADP

Lagging NDX stocks included: MU, VIP, GOLD, BIDU, AAPL, ISRG, ILMN, SYMC, WFM, ALXN

Leading stocks > +2% on Friday included: XONE, UAL, DAL, AAL, ESI, P, CSIQ, TSL, BX, DDD, TWTR, C

Lagging stocks < -2.0% included: MCP, ANGI, ANR, CLF, WLT, QIHU, SINA

Stocks to Watch on Monday

Holding Above 30 DMA= 72

CTSH, FISV, INTU, WDC, GOOG, AMZN, ILMN, LLTC, EXPE, ADSK, ESRX, ALXN, MDLZ, MNST, YHOO, DISH, SIAL, CELG, CMCSA, LBTYA, GMCR, DTV, STX, BIDU, BRCM, WYNN, FB, AVGO, INTC, EQIX, TSLA, ORLY, NXPI, ADBE, AKAM, EBAY, VIAB, CA, CHKP, FFIV, LINTA, PCAR, VOD, TSCO, SNDK, VRTX, XLNX, ADP, ATVI, CTXS, GILD, PAYX, ADI, CTRX, DISCA, KRFT, FOXA, AMAT, KLAC, MAT, NVDA, SPLS, TXN, VIP, ALTR, BBBY, CSCO, SYMC, SBAC, CHTR, AMGN, DLTR, ROST

Moving Above 30 DMA = 3

ADI, HSIC, MXIM

Moving Below 30 DMA = 8

AAPL, BIIB, CHRW, EXPD, ISRG, MU, QCOM, WFM

Staying Below 30 DMA

FAST, MYL, NFLX, NTAP, VRSK, PCLN, GRMN, MSFT, CERN, SRCL, TRIP, COST, SBUX, LMCA, SIRI, REGN, GOLD

Sixteen Week Intermediate Term Market Trend: Up

3-Day Short Term Market Trend: Down/Neutral