SPY New High Close Forms Potential Shooting Star Following Monday's HBO...BIIB, ALXN Crushed on Disappointing Drug Data...

Five of nine sectors moved higher on Tuesday…XLE, XLI and XLK were the strongest sectors while XLV was the weakest sector.  Oil futures rose .72 to close at 50.43. This is oil’s first close above 50 since July 21, 2015

Breadth weakened as advancers led 1,908 to 1,125 on the NYSE and decliners led 1,311 to 1,280 on the NASDAQ.

Tuesday – weakened, advancers led on the NYES, +5

Monday – strengthened, advancers led, +8

Friday – weakened, advancers led on NYSE, +3

Thursday – weakened slightly, advancers led, +7

Wednesday – strengthened, advancers led, +7

SPY up .33 at 211.68 on 60.9 million shares, 22% below average volume

VIX up .40 at 14.05

TLT up .32 at 132.56…on 4.6 million shares, 32% below average volume

Technical Commentary:

IWM +0.29%, SPY +0.16%, DIA +0.11%, QQQ -0.25%,

NDX was the weakest broad market index on Tuesday as BIIB and ALXN were crushed and FB, AMZN, AMGN and BIDU also added to NDX weakness.  BIIB -12.76% was down as Multiple Sclerosis therapy missed its study goals.  Citigroup downgraded the shares to neutral.  ALXN -10.88% Phase 3 trial of Soliris produced disappointing data.  Barclays cut its price target on ALXN from 180 to 165.

SPY which broke out of horizontal resistance on Monday rose on Tuesday, gave back some of its early gains and formed a potential shooting star.  A shooting star is a one-day candle pattern that indicates potential short-term buying exhaustion and the potential for a short-term.  Some short-term traders move the trades stop below the shooting star to protect short-term profits.  Be alert and follow your trading rules.

FFIV +12.63% on news it is working with GS on potential takeover interest.

Technical analysis based trades should be closed before earnings.

Trade what you see, not…

Stocks below support should generally be traded bearishly until a reversal pattern forms.

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Strong Stocks: Setups and Moves You Can Use

Bull Flag Setups include:  ADBE, FAS, BIDU, MSFT, NFLX, NTES, NVDA, QCOM, NXPI, GOOG, WFC, XLF, MLM, AMAT, CSCO, MAT, XLNX, EQT, AXP, BAC, C, MS, JUNO, ADP, BSX

Bull Flag Bounces include: MAT, TSLA, SWKS, TSCO, CTXS, CERN, ORLY

Horizontal Breakout Setups include: CRC, HTZ, CIE, LNG, PCAR, AKAM, ADSK, AMD, NBR, AAPL, VOD, STI, JPM, CHK, SCTY, XLB, STLD, GLPI, STLD, SCHN, ESV, BBBY, MOS, FTNT, WM, SWKS, KHC, COST, UTX, EA, YELP, WRK, FLIR

Horizontal Breakout include: XLI, EPE, SDRL, CBL, CTXS, EQIX, XEC, ULTA, X, FISV, RDC, HP, TXN, CLR, CRZO, RSPP, WYNN

New Highs include: PTEN, IWM, DIA, SPY, WWAV, CNP, WMB, OKE, ALB, EQT, XEC, ULTA, RES, HP, SPN, FMC, RRC, RSPP

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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 SPY MFC green line pointed up at 94, bullish.

56 of 100 NDX stocks closed higher and two were unchanged on Tuesday.

79 NDX stocks are above their 30 DMA.

NDX Stocks to Watch on Wednesday:

Moving Above 30 DMA = 6

CERN, EBAY, PCAR, SRCL, TSLA, WBA

Moving Below 30 DMA = 7                                                                        

ADP, ALXN, BIIB, BMRN, FOXA, MAR, YHOO

6-month Intermediate Term Market Trend: Neutral

3-day Short Term Market Trend: Up