Be Ready For Upside Continuation Trade
Yesterday
the S&P 500 ended up +0.7%,Â
as total New York Stock Exchange volume increased slightly to 969 million. The
volume ratio improved to 55 while breadth was slightly positive. Institutional
activity picked up a bit as blocks of 10,000 shares or more increased to
20,662.Â
The index closed at the
top of its range with the market-on-close buy programs and was a narrow-range
inside day that held its 50-day EMA of 1463.97 as the intraday low was 1464.30.
That makes a seven-day pullback to the 50-day EMA and a top-of-the-range
closing, so you should be ready to play the upside continuation trade if the
Generals give it to us.
It appears that there was
some report-card trading yesterday as Sun Micro
(
SUNW |
Quote |
Chart |
News |
PowerRating) made new highs, and
Intel
(
INTC |
Quote |
Chart |
News |
PowerRating) and Cisco
(
CSCO |
Quote |
Chart |
News |
PowerRating) both moved up as well, and also Oracle
(
ORCL |
Quote |
Chart |
News |
PowerRating) finishing up a point. I see where the Generals got American
International Group
(
AIG |
Quote |
Chart |
News |
PowerRating), their favorite insurance stock, and overweighted,
to new highs, and got Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating) started up 1 3/4 points. That sets up
Home Depot
(
HD |
Quote |
Chart |
News |
PowerRating) to follow.
The brokers continued to
move with take-over fever, as Lehman
Brothers
(
LEH |
Quote |
Chart |
News |
PowerRating), Merrill Lynch
(
MER |
Quote |
Chart |
News |
PowerRating) and then Bear Stearns
(
BSC |
Quote |
Chart |
News |
PowerRating),
after planting the sell innuendo, all advanced. Morgan Stanley
(
MWD |
Quote |
Chart |
News |
PowerRating) didn’t
give us entry, but is sitting right at that get-me-to-the-100 zone, so be all
over that one when it goes.
The semis and biotechs
continue their flip-flops as the SOX led yesterday, +2.7%, with the BTK off
5.5%. The stocks in both of these groups are great trading vehicles as they can
be moved any way or amount that the players want to take them.
There were some good
setups after yesterday’s action, so this morning’s list will be longer than
usual and will include more of the Generals’ favorites that might be
strategically added to for the rest of the week, and hopefully, some
reinvestment of funds during the first couple of days in August.
I will be traveling on
business this Thursday and Friday, but you will get some excellent opportunities
from this list between today and Friday.Â
| (September Futures) |
||
|
Fair
|
Buy
|
Sell
|
| 13.00 |
14.10 |
11.90 |
Pattern Setups
In the overall market, both the QQQs
and the SPYs set up their 50-day pivot points.
In the brokers:
(
MER |
Quote |
Chart |
News |
PowerRating) is an inside
day in a top-of-the-range closing, also
(
MWD |
Quote |
Chart |
News |
PowerRating).
In the networking group:
(
BRCM |
Quote |
Chart |
News |
PowerRating),
(
CIEN |
Quote |
Chart |
News |
PowerRating),
(
CSCO |
Quote |
Chart |
News |
PowerRating), and
(
TLAB |
Quote |
Chart |
News |
PowerRating).
In the semiconductors,
(
INTC |
Quote |
Chart |
News |
PowerRating),
(
ALTR |
Quote |
Chart |
News |
PowerRating),
(
MU |
Quote |
Chart |
News |
PowerRating),
(
NVLS |
Quote |
Chart |
News |
PowerRating), and
(
RMBS |
Quote |
Chart |
News |
PowerRating).
Some other techs:
(
ADBE |
Quote |
Chart |
News |
PowerRating),
(
ORCL |
Quote |
Chart |
News |
PowerRating), and
(
NOK |
Quote |
Chart |
News |
PowerRating). From your intraday charts
(
SUNW |
Quote |
Chart |
News |
PowerRating) (even though
it busted to new highs yesterday) and also
(
EMC |
Quote |
Chart |
News |
PowerRating) and
(
GE |
Quote |
Chart |
News |
PowerRating) (which is
largely held and overweighted, and I’m sure they’ll try to get it going if the
game is on this week).
In the retail sector: I mentioned
(
WMT |
Quote |
Chart |
News |
PowerRating) before,
(
HD |
Quote |
Chart |
News |
PowerRating),
(
KSS |
Quote |
Chart |
News |
PowerRating).
Internet stocks:
(
EXDS |
Quote |
Chart |
News |
PowerRating) and
(
YHOO |
Quote |
Chart |
News |
PowerRating).
Financial stocks:
(
AIG |
Quote |
Chart |
News |
PowerRating),
(
JPM |
Quote |
Chart |
News |
PowerRating),
(
C |
Quote |
Chart |
News |
PowerRating) and
(
AFL |
Quote |
Chart |
News |
PowerRating).
Some OTC momentum stocks:
(
BRCM |
Quote |
Chart |
News |
PowerRating),
(
NTAP |
Quote |
Chart |
News |
PowerRating),
(
SEBL |
Quote |
Chart |
News |
PowerRating),
(
NXTL |
Quote |
Chart |
News |
PowerRating),
(
DISH |
Quote |
Chart |
News |
PowerRating),
(
JNPR |
Quote |
Chart |
News |
PowerRating),
(
BEAS |
Quote |
Chart |
News |
PowerRating),
(
QLGC |
Quote |
Chart |
News |
PowerRating),
(
ARBA |
Quote |
Chart |
News |
PowerRating),
(
PMCS |
Quote |
Chart |
News |
PowerRating) and
(
TERN |
Quote |
Chart |
News |
PowerRating).
This list is not all-inclusive. These
are just the names that have really been strong RS stocks that set up yesterday.
Have a good trading day and a good
rest of the week. I’ll see you all on Monday.
