This Is A Must For Every Daytrader Or Short-Term Position Trader
Just as the October month-end was +2.1% for
the
weekend ending Oct. 31, November followed suit with a +2.0% gain into
month-end.
Good job, Generals. The key major sectors had excellent closing weeks for
October/November, with the
(
SMH |
Quote |
Chart |
News |
PowerRating)s +7.8% in October and +5.2% month end
November. The XBD went +5.0% and +3.5%, while the CYC was +4.9% and +3.8%. I
must also point out that the XLB (basic industry SPDR) made a new 52-week
high
at 24.50, which is also a multi-year high dating back to Jan.17, 2000, when
it
closed at 24.86. The XLB topped out on May 10, 1999, at 28.48, then had a
retest
of that high at 27.94. The Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) peaked at 11,750 on Jan. 10,
2000,
followed by the SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) on March 20, 2000. That is why I key on
the
XLBs as one of my early keys, along with the SMH and XBD.
Since an October 2000 low of 17, the XLBs
rallied
to 24.63, or +44.9%, then declined to 17.05 in September 2001, which was
followed by a +43.3% rally to 24.44 in May 2002. Then we had the October
2002
low of 16.53, which was followed by this current +48.2% rally to Friday’s
high
and close of 24.45. The XLBs aren’t going to sneak up on anybody from here.
They
stay on my daily short watch.
Just as volume precedes price on good moves,
price precedes expected positive news, and certainly the basic industry
stocks
have done that prior to the ongoing positive economic news that we have had
recently. The sequence was perception by the Generals, then the price move
as
they bought them up, and now the positive news starts to flow. The easy part
is
over, and the XLBs will be monitored closely for any early weakness as we
go.
Last week, we finished with the four-day MA of
the volume ratio at 72, five-day RSI at 69, and four-day MA of advances minus
declines at +1134, so the market is short-term overbought, but as I said last
week, the primary intermediate and short-term trends are all up, and other than
on a daytrading basis, we look for short-term oversold conditions for any long
position entries.
| size=2> |
Monday
11/24 |
Tuesday
11/25 |
Wednesday
11/26 |
Thursday
11/27 |
Friday
11/28 |
Net
|
| color=#0000ff>Index | ||||||
| color=#0000ff>SPX | ||||||
| color=#0000ff>High |
1052.08
|
1058.05
|
1058.45
|
H
|
1060.63
|
1060.63
|
| color=#0000ff>Low |
1035.28
|
1049.31
|
1048.28
|
|
1056.77
|
1035.28
|
| color=#0000ff>Close |
1052.08
|
1053.89
|
1058.45
|
O
|
1058.20
|
1058.20
|
| color=#0000ff>% |
+1.6
|
+0.2
|
+0.4
|
|
-.02
|
+2.0
|
| color=#0000ff>Range |
16.8
|
8.7
|
10.2
|
L
|
3.9
|
9.9
|
| color=#0000ff>% Range |
100
|
53
|
100
|
|
37
|
90
|
| color=#0000ff>INDU |
9748
|
9764
|
9780
|
I
|
9782
|
|
| color=#0000ff>% |
+1.2
|
+0.2
|
+0.2
|
+0.2
|
+1.8
|
|
| color=#0000ff>Nasdaq |
1947
|
1943
|
1953
|
D
|
1960
|
|
| color=#0000ff>% |
+2.8
|
-0.2
|
+0.5
|
+0.4
|
+3.5
|
|
| color=#0000ff>QQQ |
35.19
|
35.12
|
35.34
|
A
|
35.34
|
|
| color=#0000ff>% |
+2.8
|
-0.2
|
+0.5
|
+0.2
|
+3.3
|
|
| color=#0000ff>NYSE |
Y
|
|||||
| color=#0000ff>T. VOL |
1.30
|
1.33
|
1.10
|
487
|
1.05
|
|
| color=#0000ff>U. VOL |
1.10
|
917
|
798
|
280
|
774
|
|
| color=#0000ff>D. VOL |
185
|
401
|
295
|
193
|
269
|
|
| color=#0000ff>VR |
86
|
70
|
73
|
59
|
||
| color=#0000ff>4 MA |
59
|
61
|
72
|
72
|
||
| color=#0000ff>5 RSI |
53
|
64
|
66
|
69
|
||
| color=#0000ff>ADV |
2452
|
2234
|
2144
|
1848
|
21700
|
|
| color=#0000ff>DEC |
838
|
1035
|
1061
|
1207
|
1035
|
|
| color=#0000ff>A-D |
+1614
|
+1199
|
+1083
|
+641
|
+4537
|
|
| color=#0000ff>4 MA |
+536
|
+676
|
+1133
|
+1134
|
||
| color=#0000ff>SECTORS | ||||||
| color=#0000ff>SMH |
+3.5
|
+0.4
|
+0.2
|
+1.1
|
+5.2
|
|
| color=#0000ff>BKX |
+1.0
|
+0.3
|
+0.3
|
-0.1
|
+1.5
|
|
| color=#0000ff>XBD |
+1.3
|
+1.0
|
+1.0
|
+0.2
|
+3.5
|
|
| color=#0000ff>RTH |
+2.4
|
+0.3
|
-0.6
|
+0.3
|
+2.4
|
|
| color=#0000ff>CYC |
+1.9
|
+1.0
|
+0.6
|
+0.3
|
+3.8
|
|
| color=#0000ff>PPH |
+1.5
|
-0.7
|
+.07
|
-0.5
|
+1.0
|
|
| color=#0000ff>OIH |
+.09
|
+1.1
|
+1.0
|
+.02
|
+3.2
|
|
| color=#0000ff>BBH |
+2.4
|
-0.9
|
-0.7
|
+0.2
|
+1.0
|
|
| color=#0000ff>TLT |
-0.8
|
+0.6
|
-0.4
|
-0.9
|
-1.5
|
|
| color=#0000ff>XAU |
-1.6
|
+1.8
|
+2.9
|
+1.8
|
+4.9
|
The dollar made a new closing low on Friday and
now is certainly the key focus, as the XAU made another new high at 109.86 since
breaking out of the six-day trading range above 105. Watch those bond yields
closely and those ARMs some of you have at those low interest rates.
For Active Traders
The major indices are back challenging the
highs
and at a confluence zone with no less than 11 different numbers between
1072 –
1058. The next significant confluence above that is 1141 – 1166 with five
different numbers, including the .50 retracement to 1553 from 769 of 1160
and
the .50 retracement to the secondary high at 1530 of 1150. The Dow’s 9904
high
last month was within 1.0% of the 10,011 .618 retracement to the 11.750
all-time
high.
Two key stocks right now for the S&P 500 and
Dow for any major move in the indices through the current levels are
(
MSFT |
Quote |
Chart |
News |
PowerRating)
and
(
GE |
Quote |
Chart |
News |
PowerRating), the two biggest market-cap stocks in the SPX and also in the Dow,
which is a price-weighted index. The two stocks comprise 11.6% of the OEX and
almost 7.0% of the SPX. MSFT alone is over 11% of the NDX 100 and along with
(
INTC |
Quote |
Chart |
News |
PowerRating), total 18% of the entire weighting. Watching the key stocks with
the biggest weightings in the major indices and HOLDRs is an absolute must on
a daily basis to keep a handle on the ever-changing short-term dynamics, a must
for every daytrader or short-term position trader.
For Today
I am doing this Sunday for Monday, and I
don’t
know the reaction in the futures markets to the new low in the Dollar, but
you
should also be watching the
(
TLT |
Quote |
Chart |
News |
PowerRating)s, which closed below an eight-day
trading
range Friday right at the 200-day EMA. The August low is 80.91, and the
200-day
EMA is at 86.47, with Friday’s close at 85.13. The short remains in place
with a
stop above 86.93. Excellent risk/reward. The action of the Dollar this week
will
outweigh any near-term economic numbers or reports, which stocks have
certainly
discounted already to a great extent.
With the SPX pushing the higher end of the
trading range and short-term overbought, I will favor the futures/index
proxies
on intraday shorts, rather than individual stocks. However, if the indices
push
on to new highs, I will have some focus stocks that have defined daily and
weekly chart patterns, and in good uptrends. This is in case any new
December
money gets put to work this week if the Dollar doesn’t create an air pocket
down. Some of the names on my list are
(
LOW |
Quote |
Chart |
News |
PowerRating),
(
CCL |
Quote |
Chart |
News |
PowerRating),
(
PCAR |
Quote |
Chart |
News |
PowerRating),
(
CSCO |
Quote |
Chart |
News |
PowerRating),
(
BNI |
Quote |
Chart |
News |
PowerRating),
(
OMC |
Quote |
Chart |
News |
PowerRating),
(
QLGC |
Quote |
Chart |
News |
PowerRating),
(
LLTC |
Quote |
Chart |
News |
PowerRating),
(
XRAY |
Quote |
Chart |
News |
PowerRating),
(
MUR |
Quote |
Chart |
News |
PowerRating),
(
UCL |
Quote |
Chart |
News |
PowerRating),
(
APA |
Quote |
Chart |
News |
PowerRating),
(
FLEX |
Quote |
Chart |
News |
PowerRating) and
(
LRCX |
Quote |
Chart |
News |
PowerRating). Also, as I
said,
MSFT and GE will be on my list all of December because they could get pushed
to
get the major indices going.
Have a good trading day,
Kevin Haggerty
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