Wednesday, January 6, 2016

SPX Breaks Support on Fed Minutes Reaction...Recovers to Close at Support in Last Hour...NFLX Surges...

All nine sectors moved lower on WednesdayXLU, XLP and XLV were the strongest sectors for the second straight day while XLE was the weakest sector

Breadth weakened as decliners led advancers 2.87 to 1 on the NYSE and 2.43 to 1 on the NASDAQ.

Wednesday – weakened, decliners led
Tuesday – strengthened, advancers led
Monday – weakened, decliners led
Friday – New Year Holiday
Thursday- weakened, decliners led


SPY down 2.54 at 198.82 on 152.1 million shares, 33% above average volume
VIX up 1.25 at 20.59…
TNX down .71 at 21.77…
TLT up 1.63 at 122.59…on 8.9 million shares, 17% above average volume
XLF down .36 at 23.10…on 62.7 million shares, 50% above average volume

AAPL down 2.01 at 100.70 on 68.4 million shares, 66% above average volume
FB up .24 at 102.97 on 25.0 million shares, 25% above average volume

Technical Commentary:
QQQ -0.96%, SPY -1.26%, DIA -1.43%, IWM -1.52%,.

A combination of more slowing Chinese economic data Service PMI at 50.2, geopolitical concerns in North Korea and Brent crude falling to an 11 year low, stock futures dropped overnight and the SPX/SPY traded sharply lower on Wednesday.  

A late selloff at 2 pm ET after recent Fed minutes were released sent the SPX down more than 10 more points breaking multi-week support.  A rally in the last hour reversed that drop with the SPX closing back above support.

NFLX +9.31% on news that service expanded into 130 more countries.
TWX +4.73% after positive comments from Albert Fried & Co.
RAI +2.58% forms new subsidiary to develop vapor and nicotene.
HAS +2.51%, attributed to positive comments by Kevin O’Leary.

WMT +1.00% was the only DJIA stock to rise on Wedesday.

REITs EQIX, O, PSA and GGP continued to rise on Wednesday.

While some leading stocks are moving up, traders need to watch current support carefully and be prepared to trade to the downside in down trending stocks if support is broken.

Oil fell $2.08 to close at 34.06, an 11 year low, on Wednesday leading energy stocks WMB, SWN, MRO, APA, CNX, MUR, APC, ESV, COG, DO, DVN, NFX, PXD, NOV, CHK, RRC, HES, XEC, FTI, EQT, NBL, HP, KMI and RIG sharply lower each by more than 5% .  

Due to a reduction in imports oil inventories dropped 5.1 million barrels this week, but gasoline inventories jumped 10.6 million barrels in today’s EIA Petroleum Status report.

Oil continued to fall in after-hours electronic trading.


YTD:
SPX Leaders:  FLIR, TWX, FSLR, KSS, SE, DLTR
SPX Losers: AN, APA, AA, QRVO, ESV, CF, CMG

NDX Leaders:  DLTR, CTRP, NFLX, TMUS, ISRG
NDX Losers: EA, NTAP, LVNTA, WBA, ADI, AMZN, ENDP, PCLN

DJI Leaders:  WMT, MCD,
DJI Losers: AXP, GSC, JPM, DD, DIS, AAPL


Remember:  “It’s a market of stocks, not just a stock market.”

Trade with the trend of the chart you are trading and continue to move your profit protection stops.  Continue to follow your rules.

The SPX MFC green line is pointed down at 32. 

Short-term Chart Targets:
SPY =...201.90
QQQ = 110.18…
IWM = 110.83…
                   
Support Levels
SPY = 198.59, 197.60…
QQQ = 108.12, 107.41…
IWM = 108.00

__________________

Setups
Horizontal Breakout: NFLX, DPS, DRI, KMB, KR, MCD, BXLT, FINL, PLAY,
Diagonal Breakout: RCL, SUNE, WUBA, YNDX,
Bull Flag: MYL, CAH, CCL, CNC, CSIQ, FSLR, JASO, MPEL, SCTY, SOHU, SPWR, TERP, FIVE, RUN, SEDG, W,
Potential Bullish Divergence: AAPL, ADSK, COST, MNST, ORLY, SBUX, SWKS, CRM, CRUS, ETFC, JBL, QRVO, TPX, YELP, ZION, LNKD, MS
At Support: TPX, YELP, FAS, KWEB, NKE, SKX, SLCA, SONC, STI, V

Moves
H Breakout: DLTR
D Breakout: SINA
MACD Divergence Bounce: GILD, NFLX, TSL
Gap Up: GLD, TLT
Bear Flag: PANW,

Support Break: IWM, ATVI, INTC, LRCX, NXPI, SWKS, JBL, SCHW, ZION, GLW, 
______________________

18 of 100 NDX stocks closed higher on Wednesday.

17 NDX stocks are above their 30 DMA.

NDX Stocks to Watch on Thursday:
Moving Above 30 DMA = 0


Moving Below 30 DMA = 6
KLAC, LBTYA, MDLZ, MU, NVDA, STX

6-month Intermediate Term Market Trend: Neutral
3-day Short Term Market Trend: Down

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