Wednesday, February 5, 2014

Support Holds as DIA Gains...SPY, QQQ and IWM Form Hammer...GMCR Up 45% on EPS and KO Stake...TWTR Heads South on Weak User Growth...

Four of nine sectors moved higher on Wednesday…XLY, XLB and XLK were the strongest sectors…while XLU was the weakest sector.   

Breadth weakened as decliners led advancers 1.43 to 1 on the NYSE and 2.14 to 1 on the NASDAQ.

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


SPY down .22 at 175.17 volume 163.7 million shares, above average volume
VIX up .84 at 19.95…
TNX up .43 at 26.67…
TLT down 1.00 at 107.16...
XLF down .02 at 20.71 volume 47.1 million shares

AAPL up 3.80 at 512.59 volume 11.7 million shares
FB down .56 at 62.19…volume 52.3 million shares…lower than average volume


Technical Commentary: 
DIA + 0.06%, IWM – 0.75%, QQQ – 0.26%, SPY – 0.12%.

Stocks and indexes on Wednesday sold off early, tested Monday’s support low and bounced again with SPY, QQQ and IWM forming hammer candle patterns and the DIA forming a micro bullish engulfing.  Interest rates, TNX +0.43 jumped while bonds TLT -1.00 gapped lower and VIX closed higher.  The SPY, QQQ and DIA are still forming MACD bullish divergences as we discussed in Tuesday’s post.

BWLD -13.63, -9.68% reversed its after-hours positive earnings reaction on Tuesday and fell on heavy volume.   DDD -11.66, -15.39, CHRW -5.48, -9.35% and CTSH -4.16, -4.29% gapped lower after negative earnings reactions.

GMCR +36.45, +45.07% gapped higher after the close on better than expected EPS and an announcement that KO would  take a 10% stake in GMCR.

TWTR -11.81, -17.90% was down huge in after-hours trading after releasing its first earnings report as a public company with surprise EPS of 2 cents (adjusted).  The bad news was user growth and timeline views were significantly weaker than expected.

P -3.55, -9.91% and TSO -1.97, -3.94% also had negative earnings reactions after the close on Wednesday.

Also after the close positive earnings reactions included AKAM +8.46, +17.84%, YELP +5.57, +7.40%, DIS +2.44, +3.40%, and SWI +1.16, +2.72%.  Look for potential bullish gaps on these stocks Thursday morning.


Trade with the trend of the chart you are trading and move your protective stops.  Be mindful of reversal patterns like double bottoms and MACD divergences.  Continue to follow your rules.


Short-term up trend Chart Targets:
SPY = 179.81…
QQQ = 86.80
IWM = 111.02, 113.65…

Support Levels
SPY = 173.95, 172.14
QQQ = 84.29, 83.50, 82.72
IWM = 108.39, 106.76

Q4 earnings season
Monday – AEIS, AGNC
Tuesday – ADM, BWLD, CHRW, CME, GILD, HCA, IP, KORS, KEYW
Wednesday – AKAM, ADP, BIDU, CTSH, FISV, GMCR, HUM, MDC, MRK, NXPI, ORLY, P, SCSS, SWI, TSO, NDAQ, TWX, TWTR, DIS, YELP
Thursday – ATVI, LNKD, SIAL, TPX, VRSN
Friday – CBOE, CI, MCO

Q4 Earnings Reactions
Positive Reactions – TWX, MYGN, LVLT, CVD, AGNC, KORS, IDXX, XYL, YUM, NOV, SPG, TSN, ZNGA, ALXN, BRCM, BX, CMG, GOOG, JDSU, MTW, PHM, RYL, VIAB, V, BA, DOW, FB, LVS, QCOM, VLO, AKS, AAL, CHKP, EA, F, ILMN, LXK, CAT, RCL, JNPR, MSFT, KMB, PG, MXIM, SBUX, NFLX, FFIV, URI, UNP, EBAY, MCD, CREE, TXN, UTX, NUAN, XLNX, BHI, DAL, RF, MS, SLB, STI, AXP, SWKS, BAC, LLTC, WEN, MON, MU, STZ, APOL


Negative Reactions – ADP, CTSH, GILD, HUM, MDC, ADM, CVX, MA, MAT, PCAR, AMZN, MMM, CELG, CL, XOM, ESI, HOG, OSTK, POT, SHW, WHR, BA, CTXS, EMC, TSCO, CRUS, GLW, DD, F, VMW, YHOO, AAPL, STX, ZION, HON, KSU, SWK, STT, ALTR, ISRG, KLAC, KEY, JCI, LMT, WDC, ABT, BAX, ATI, COH, FCX, AMD, IBM, HAL, JNJ, TRV, VZ, GE, COF, INTC, UNH, C, GS, CSX, FAST, AA, FDO, BBBY, SCHN

Reversal of Initial Reaction – HON, FAST, FDO, AA


The Market Forecast Green Line turned up below 20 on Wednesday.

____________________

Setups
H Breakout: GMCR,   
Diagonal Breakout: BBRY, C, Z, ZION, DTV, MU, SBUX, TRIP,
Bull Flag: MTW, TSLA, JNPR, RCL, RCL, CMCSA, FFIV, GOOG, NFLX, NTAP, WYNN
Potential Bullish Divergence:  BAC, CIEN, DRYS, FSLR, MCP, MFRM, NKE, NTES, SCSS, WLT, X, Z, ADSK, COST, INTC, ROST, STX, WDC,
Gap Up:  GMCR, AKAM, SWI, DIS, YELP
Gap Down:  TWTR, P, TSO
Bear Flag: 
At Support: CIEN, X,
C- Pattern:

Moves
New Highs
Gap Up: TBT, MYGN, LVLT, CVD 
Gap Down: ANGI, DDD, TLT, XONE, CTSH, CHRW
H Breakout: CRM, SWI,  
Diagonal Breakout:
Breakout Test: 
Bounce: GLW, BBRY, IBM, MS, RAX, V, YNDX, ADBE, AKAM, EBAY, SNDK,
MACD Divergence Bounce: GME,  
Bear Flag:  
Support Break: LVS, SFUN, SSYS,



______________________


41 out of 100 NDX stocks closed higher on Wednesday.

Leading NDX 100 stocks included: PCAR, ADBE, AKAM, DISCA, ISRG, MU, CHKP

Lagging NDX stocks included: CHRW, CERN, GILD, CTSH, BIIB, SIRI, TSLA, BIDU, FFIV, VRTX, LMCA

Leading stocks > +2% on Wednesday included: SWI, GME, RAX, GLW

Lagging stocks < -2.0% included: DDD, XONE, SFUN, ANGI, SSYS, ANR, QIHU


Stocks to Watch on Thursday
Holding Above 30 DMA= 27
ILMN, ESRX, CMCSA, EQIX, FFIV, SBAC, ISRG, MU, BIIB, GILD, MXIM, TSLA, NXPI, GOLD, NFLX, CHTR, ALTR, ALXN, REGN, GOOG, WYNN, FB, GMCR, ADBE, ORLY, SRCL, DISH

Moving Above 30 DMA = 1
EBAY

Moving Below 30 DMA = 5
AVGO, CERN, CHRW, NTAP, VRTX


Staying Below 30 DMA
ADSK, AKAM, AMGN, BRCM, CHKP, HSIC, MSFT, MYL, QCOM, SIAL, XLNX, WDC, AMZN, DTV, MNST,CTRX, VRSK, SYMC, SIRI, PCLN, AAPL, AMAT,CA, CELG, CTSH, EXPD, FAST, FISV, KLAC, LLTC, NVDA, PCAR, SNDK, VOD, TXN, VIP, ADP, BIDU, CTXS, GRMN, ADI, KRFT, EXPE, INTC, INTU, MDLZ, LBTYA, TRIP, YHOO, VIAB, LINTA, TSCO,ATVI, PAYX, ROST, DLTR,BBBY, SPLS, FOXA,MAT, DISCA, WFM, COST, SBUX, LMCA,


Sixteen Week Intermediate Term Market Trend: Up
3-Day Short Term Market Trend: Down

No comments: