Stocks Pause Test Breakout as SPY, DIA, QQQ, IWM Form Horizontal Bull Flag...

Four of nine sectors moved higher on Wednesday …XLP, XLY and XLb were the strongest sectors while XLE was the weakest sector.  Oil futures fell 1.26 to close at 41.49.

Breadth weakened as decliners led 1,644 to 1,309 on the NYSE and led 1,583 to 1,583 on the NASDAQ.

Wednesday – weakened, decliners led, +4

Tuesday – strengthened, advancers led, +4

Monday – weakened, advancers led on NYSE, +4

Friday – strengthened, advancers led, +8

Thursday – weakened, advancers led on NYSE, +4

SPY down .54 at 217.64 on 57.9 million shares, 21% below average volume

VIX up .39 at 12.05

TLT up .54 at 140.16…on 5.8 million shares, 28% below average volume

Technical Commentary:

DIA -0.12%, QQQ -0.26%, SPY -0.54%, IWM -0.72%,

After new high on Tuesday QQQ and SPY pause and make a modest pull back on Wednesday and test Friday’s breakout. 

SPY, DIA, QQQ, IWM horizontal bull flag setups

XLB, XLF, XLI, XLY horizontal breakout setups

XLV bull flag setup

Consider moving up stops on short term bullish trades that could pull back.  All according to your profit protection rules.

Remember breakouts typically test about 70% of the time.

Earning’s Announcements:

Positive Reactions: YELP, RL, JD, DIS, FOSL, TAHO, XON,

YELP +4.19, +12.84%

RL +8.07, +8.49%

JD +1.04, +4.65%

DIS +1.19, +1.23%

FOSL +0.21, +0.69%

Negative Reactions: PRGO, KORS, MYL

PRGO -9.09, -9.56%

KORS -1.40, -2.79%

MYL -1.13, -2.26%

Technical analysis based trades should be closed before earnings. After-hours

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:  PCAR, XLV, PCLN, NTES, SIRI, DHI, GRMN, BIIB, JNJ, VLO, MAC, UNH, WHR, CNC, MRK, MPC, ALXN, AMGN, CELG, DISCA, ILMN, MAR, MNST, NFLX, REGN, SYMC, JPM, ZION, WMB, ETFC, HPE, EA,

Bull Flag Bounces include: BA, PG, EXPE, DLTR,

Horizontal Breakout Setups include: WFC, ADSK, BX, AMZN, CAT, STX, SBAC, IBM, MU, AMAT, AIV, TSN, CSCO, KMX, LMT, ULTA, BURL, HLT, ORLY, COST, CINF, QCOM, EBAY, TXN, FB, URI, TJX, STI, ROST, MAT, LB, CSX, MXIM, ADI, KHC,

Horizontal Breakout include: CBL, AMBA,

New Highs include: CBL, AVGO, CBG, CTRP, TSN, CERN, ULTA, LMT, NTAP, SPY, QQQ, IWM, XLNX, AAPL,  XLF, BAC, MSFT, NVDA, TMUS, STT, C, BXP, CHTR, JD, 

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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 is in the upper zone at 96, bullish.

41 of 100 NDX stocks closed higher and two were unchanged on Wednesday.

74 NDX stocks are above their 30 DMA.

NDX Stocks to Watch on Thursday:

Moving Above 30 DMA = 2

MNST, WBA

Moving Below 30 DMA = 4

BBBY, BMRN, DISH, INCY

6-month Intermediate Term Market Trend: Up

3-day Short Term Market Trend: Neutral