Financials Lead Strong and Broad Rally...AMZN Lower After Earnings...

Setups to Watch for Monday

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Technical Commentary

Broad indexes rallied on Friday led by the financial sector.  Financial stocks opened higher Friday morning led by MS, GS, ZION, C, JPM, KEY, HBAN, WFC, RF, SCHW, BAC and STT on word that the President would sign an executive order calling for review of the Dodd-Frank act.  Another indication that regulations might be reduced and bank profits rise.

Up Trend: XLI, XLB, XLY, XLK, XLP

Sideways: XLU, XLF. XLRE, XLV

Down Trend: XLE

For the week ended February 3, five of ten sectors moved higher.

Leading Sectors:

XLV +2.39%, XLP +1.18%, XLU +1.05%, XLRE +0.98%, XLF +0.30%,

SPY +0.16%,

Lagging Sectors:

XLK -0.10%, XLY -0.67%, XLE -1.12%, XLI -1.35%, XLB -1.38%,

YTD: 23

Leading Sectors:

XLK +4.82%, XLB +4.79%, XLY +3.80%, XLV +3.60%,

SPY +2.60%,

Lagging Sectors:

XLP +2.49%, XLI +2.25%, XLF +2.02%, XLU +0.68%, XLRE +0.59%, XLE -2.55%

Breadth strengthened as advancers led 2,382 to 647 on the NYSE and led 2,096 to 748 on the NASDAQ.

Friday – strengthened, advancers led, +9 sectors

Thursday – strengthened, advancers led on the NYSE, +4

Wednesday – weakened, decliners led, +4

Tuesday – strengthened, advancers led, +5

Monday – weakened, decliners led, +1

IWM +1.53%, DIA +0.89%, SPY +0.69%, QQQ +0.29%,

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SPY up 1.57 at 229.34 on 80.5 million shares, 13% above average volume,

VIX down 0.96 at 10.97

TLT down 0.05 at 119.00…on 10.2 million shares, 19% above average volume

Oil futures were up .21 to close at 53.85 on Friday.  

The SPY MFC green line turned up at 74 bullish. 

6-month Intermediate Term Market Trend: Up

3-day Short Term Market Trend: Up

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SPX and NDX Highlights

SPX up 17 points at 2,297 giving a bull flag entry on Friday.

SPX  gainers MTD, M, MS, AMGN, V, GS, IVZ, CLX, ZION, TSS, GCI, COP, HPE, PFG, SYF, MRO, C, R, JPM, PWR, KEY, TIF, AMP, HBAN, NFX, WFC, LUK, ALLE

QQQ closes up 36 cents at 125.68, 12 cents below its all-time high last week.

   

NDX point leaders: AMGN, MSFT, AAPL, SBUX, CHTR, ADBE, GOOG, AVGO, KHC and CSCO

82 of 100 NDX stocks closed higher on Friday.

NDX Stocks to Watch on Monday:

Moving Above 30 DMA = 3

CTAS, MSFT, SBAC,  

Moving Below 30 DMA = 0

66 NDX stocks are above their 30 DMA.


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Strong Stocks: Setups and Moves You Can Use

Bull Flag Setups include: XLB, XLY,

VIAB, JD, CMCSA, AAPL, FB, PCAR, YHOO, WDC, CSX, TSLA, EBAY, SWKS, FAST, ADI, NCLH, PCLN, TMUS, MXIM, NFLX, EA,

BA, DIS, CAT,

DHI, FLEX, ATI, BABA, HAL, RCL, CCL, SQ,

One Day Pullback: ATVI,

Bull Flag Bounces include: SPY, DIA, XLI, XLP, XLK, ADBE, CHKP, CHTR, MSFT, MAR, TXN, IBM, AXP, V, JPM, GLW, WFC, PNC, DE, GD, STI, CFG, HBAN, MS, BAC, FAS, RF, (27)

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At Support Setups include: AMZN, ALK, GOOGL, STLD, AKS, BHI, HES, TLT, MT, CLF, HIG,

Support Bounce: IWM, GS, C, ZION, KEY, UTX, INTC, DISCA, CHK, GM, XLNX, MMM, MGM, ADP, UPS, SBUX, FISV, APA, DAL

Horizontal Breakout Setups include: QQQ, IWM, XLK, AMAT, SHOP, AMD, KLAC, LNG, GS, C, ZION, KEY, JPM, WFC, UTX, X, NVDA, NTES, LRCX, TRV, UNH, LUV, CMA, ROST, PG, ICE, FCAU, WB, DD, CF, SCHW, ADP,

Horizontal Breakouts include: ADBE, V, ADSK, SOXL, MCD, NRG, AVGO, CC, CSCO, JPM, WFC,

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New Highs include: SYMC, USB, STX, CC, AAPL, COST, AMD, MU,

Break of Support: VALE, HIG, ETFC, PAYX, NUE, XOM, AAL

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Short-term Movers for the week ended Feb 3:

SPX gainers:  MJN, M, AMG, MTD, ABC, AGN, AVY, AMP, NEM, BMY, BSX, HCA, PM, MNK, IVZ, AET, ABT, HPE, TSN, MRK, TMO, DG, HCP +10, 3,  +4, 31

SPX losers:  UAA, HBI, PBI, UPS, ETFC, MET, RRC, RIG, NUE, WYNN, CAT, FLS, CHK, SCHW, -4, 36

NDX gainers:  ENDP, MYL, AMGN, AAPL, DISH, STX, +4, 6

NDX losers:  CTXS, CTSH, AAL, PAYX, BIIB, ADP, -4, 6,

YTD: 23

SPX Leaders:  NRG, AA, URI, QRVO, FCX, CRM, BSX, PHM, RCL, CNC, (331, +10 > 10p 60, +23)

SPX Losers:  UAA, SIG, KSS, XRX, RL, PBI, BMY, SWN, HES, HBI

NDX Leaders:  CSX, ILMN, SWKS, STX, INCY, VIAB, SYMC, NTES, VRTX, CHKP, (82, +4 >10p 36, +8)

NDX Losers:  ENDP, QCOM, CTXS, BIIB, ORLY, CTSH, MAT, ADP, AAL, PAYX

With active options trading

DJI Leaders:  AAPL, V, MRK, IBM, DIS, AXP, BA, DD, PG, CSCO, (21, +3, >10p 2,)

DJI Losers:  VZ, XOM, GE, TRV, WMT, CVX, MMM, JNJ, PFE

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Earnings

Next week:

Monday – CBOE, DO, FOXA, HAS, NOV, SALT, TSO

Tuesday – ADM, AKAM, BWLD, CAH, CSRA, DIS, GILD, GNW, ICE, MCHP, MDLZ, MNK, MOS, ORLY, PNRA, SAVE, TTWO, Z

This week:

Monday – AMG

Tuesday – AAPL, ABC, AET, AMD, DHR, EA, HCA, LLY, MA, NDAQ, NUE, PCAR, S, UAA, X, XOM

Wednesday – FB, SYMC, CRUS, NXPI, QRVO, ADP, BAX, CAVM,

Thursday – AMZN, V, CME, CMG, HIG, EL, FEYE, FTNT, GPRO, HBI, MTD, R, SIRI, VOD, SKYW,

Friday – CLX, HSY, PSX, WETF,

Earnings Reports

Positive earnings reactions

FTNT +4.54, +13.68%

MTD +29.03, +6.69%

V +3.78, +4.59%

CLX +4.90, +4.08%

Negative earnings reactions

HBI -3.73, -16.42%

FEYE -2.04, -15.73%

GPRO -1.39, -12.67%

WETF -1.26, -12.34%

SKYW -2.25, -6.18%

CMG -19.22, -4.54%

AMZN -29.75, -3.54%

  

2016 Q4 EPS

EPS Positive Reactions

FTNT, MTD, V, CLX, R, HSY, IDXX, BSX, EL, NXPI, SYMC, AMD, AAPL, AVY, ARNC, TMO, DHR, COH, NDAQ, ABC, SPG, LLY, AET, HCA, AMG, MXIM, VMW, WYNN, MSFT, KLAC, INTC, GD, ETFC, CMCSA, URI, RCL, LUV, EBAY, WDC, STX, LOGI, ROK, BA, HBAN, ISRG, NSC, ATI, GLW, RMD, DHI, DD, MB, BABA, CA, YHOO, SWKS, KSU, PG, CFG, COL, IBM, CHKP, NFLX, UNP, FAST, WFC, SNX, MSM, CUDA, GPN, MU, CAG, NKE, KMX, CCL, JBL

EPS Negative Reactions

HBI, FEYE, GPRO, SKYW, CMG, AMZN, HIG, PSX, CME, CRUS, RL, R, FB, QRVO, PBI, D, ADP, UAA, UPS, MA, NUE, XOM, JNPR, SBUX, PYPL, GOOGL, JBLU, F, CAT, WHR, FFIV, LVS, CTXS, QCOM, MUR, FCX, STLD, CA, FCX, HES, STT, AKS, VZ, JNJ, LMT, MMM, TRV, HAL, MCD, GE, NTRS, CSX, C, CMA, MS, UNH, AYI, CMC, STZ, SCHN, RHT, BBBY, FINL, AGN, FDX, GIS, ADBE

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Technical Trading Observations

Indicators can be helpful, however you should remember that indicators are lagging and secondary to price.  If the price action is up and the indicator is still pointed down, follow the price.  “Price is king” means price is most important.

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

Follow your rules and look for potential re-entry if you were stopped out of any profitable trades.

Remember breakouts typically test about 70% of the time.

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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