Here Are A Few Stocks That Are Set Up
What Thursday’s Action Tells
You
The market action was good yesterday morning
for
traders after the initial fire drill, as always, following most economic
reports. This ended at our favorite 10:00 a.m. ET time period, and we caught
a
trend up into the noon time zone, then it was a price drift into the close.
The
SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) was almost unchanged at +0.1%, closing at 1144.91, while
the
Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) was -0.2%, mostly because of
(
BA |
Quote |
Chart |
News |
PowerRating), -3.1%, and
(
UTX |
Quote |
Chart |
News |
PowerRating),
-2.7%, which have bigger influence because the Dow is a price-weighted
average.
Both the Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) at 2033, +0.5.%, and the
(
QQQ |
Quote |
Chart |
News |
PowerRating)s at
36.68,
+0.3%, continued a small oversold reflex so far.
NYSE volume was only 1.37 billion, with the volume
ratio positive at 65, and breadth +862, both better than the actual closing
prices of the SPX and Dow. The
(
SMH |
Quote |
Chart |
News |
PowerRating),
(
OIH |
Quote |
Chart |
News |
PowerRating) and
(
BBH |
Quote |
Chart |
News |
PowerRating) were the first
sectors to turn green yesterday morning and finished at +0.5%, +1.0% and the
BBH led at +2.5%. The rest of the sectors finished small green except for the
(
PPH |
Quote |
Chart |
News |
PowerRating), which was -0.6%.
| size=2> | Friday
2/20 |
Monday
2/23 |
Tuesday
2/24 |
Wednesday
2/25 |
Thursday
2/26 |
| color=#0000ff>Index | |||||
| color=#0000ff>SPX | |||||
| color=#0000ff>High | 1149.81 | 1146.69 | 1144.54 | 1145.24 | 1147.23 |
| color=#0000ff>Low | 1139.00 | 1136.98 | 1134.43 | 1138.71 | 1138.62 |
| color=#0000ff>Close | 1144.10 | 1140.99 | 1139.10 | 1143.67 | 1144.91 |
| color=#0000ff>% | -0.3 | -0.3 | -0.2 | +0.4 | +0.1 |
| color=#0000ff>Range | 10.8 | 9.7 | 10.1 | 6.5 | 8.6 |
| color=#0000ff>% Range | 47 | 41 | 46 | 76 | 73 |
| color=#0000ff>INDU | 10619 | 10610 | 10566 | 10601 | 10580 |
| color=#0000ff>% | -0.4 | -.09 | -0.4 | +0.3 | -0.2 |
| color=#0000ff>Nasdaq | 2038 | 2008 | 2005 | 2023 | 2033 |
| color=#0000ff>% | -0.4 | -1.5 | -0.1 | +0.9 | +0.5 |
| color=#0000ff>QQQ | 36.87 | 36.45 | 36.36 | 36.59 | 36.68 |
| color=#0000ff>% | -0.3 | -1.1 | -0.2 | +0.6 | +0.3 |
| color=#0000ff>NYSE | |||||
| color=#0000ff>T. VOL | 1.47 | 1.38 | 1.52 | 1.35 | 1.37 |
| color=#0000ff>U. VOL | 387 | 431 | 624 | 947 | 888 |
| color=#0000ff>D. VOL | 1.05 | 937 | 875 | 381 | 468 |
| color=#0000ff>VR | 27 | 31 | 42 | 71 | 65 |
| color=#0000ff>4 MA | 44 | 32 | 34 | 43 | 52 |
| color=#0000ff>5 RSI | 44 | 39 | 36 | 49 | 52 |
| color=#0000ff>ADV | 1168 | 1188 | 1654 | 2187 | 2071 |
| color=#0000ff>DEC | 2117 | 2099 | 1650 | 1084 | 1209 |
| color=#0000ff>A-D | -949 | -911 | +4 | +1103 | +862 |
| color=#0000ff>4 MA | -250 | -858 | -678 | -188 | +264 |
| color=#0000ff>SECTORS | |||||
| color=#0000ff>SMH | -0.8 | -2.8 | +0.5 | +1.8 | +0.5 |
| color=#0000ff>BKX | -0.4 | +0.2 | -0.1 | +0.5 | +0.2 |
| color=#0000ff>XBD | -0.6 | -1.4 | -1.2 | +1.7 | +0.4 |
| color=#0000ff>RTH | +1.1 | -0.5 | -0.1 | +0.9 | +0.2 |
| color=#0000ff>CYC | -0.7 | -0.8 | -0.3 | +0.7 | +0.5 |
| color=#0000ff>PPH | -0.3 | -0.5 | +0.5 | -0.2 | -.06 |
| color=#0000ff>OIH | -.03 | -0.5 | +1.5 | +0.3 | +1.0 |
| color=#0000ff>BBH | -0.1 | -0.9 | -0.3 | +0.9 | +2.5 |
| color=#0000ff>TLT | -0.8 | +0.5 | +0.2 | +0.9 | -0.4 |
| color=#0000ff>XAU | -2.7 | -1.0 | +3.0 | -1.1 | +0.7 |
^next^
For Active
Traders
It was the RST players that had, by far, the
biggest gains yesterday if you trade the major indices. The early opening
decline into the 10:00 a.m. bar took out Wednesday’s 36.33 low for the QQQs,
hitting 36.31, which was the RST signal bar, but because it was a wide-range
bar
with a 36.45 high, first entry was a reversal of the 36.33 low and/or above
the
36.45 high. The QQQs made higher highs and lows into the 32.84 high on the
12:45
p.m. bar, which was the 1.618 extension of the previous leg down exactly to
the
penny. It backed off to close at 36.58. If you trade the NQs, you, of
course,
had the same setup, which ran 20+ points.
The
(
SPY |
Quote |
Chart |
News |
PowerRating) did not take out Wednesday’s previous
low, but the SPX did, and the cash index takes precedence, so you could have
bought SPY on the SPX entry. The ESH4 also just held above the previous day’s
last low, and both the SPY and ESH4 had positive 8,3,3 slow stochastic divergences,
so it didn’t matter whether you played the SPYs or the futures.
If you didn’t take the RST trade in the SPX,
which always gets you into a change in trend at hand at the lowest common
denominator, then you had a no-brainer on the SPX Flip Top breakout and
re-cross
of the 20-day EMA. The SPX traded in a 2.85 point range between 1141.47 and
1138.62 from 9:30 a.m. until the breakout on the 11:00 a.m. bar. The
breakout
re-crossed the 1141.60 20-day EMA and carried up to 1147.23, then faded into
the
1144.91 close. If you missed both, it’s time for you to “COWBOY
UP.”
Energy was a key focus yesterday because of
their
rising 20-day EMA setups, and the best daily chart setups also make the best
daytrading setups. Many of you have heard that before at the seminars, but
listen to the wind, my friends. There was good trade-through entry in
(
NBR |
Quote |
Chart |
News |
PowerRating),
[BHI|BHI, OIH, and also
(
RIG |
Quote |
Chart |
News |
PowerRating) and
(
DO |
Quote |
Chart |
News |
PowerRating), both of which also had good
Trap
Door setups prior to breakouts of the previous day’s highs, and what you
look
for if the daily chart setup was good from the previous day’s action.
(
UCL |
Quote |
Chart |
News |
PowerRating)
and
(
MUR |
Quote |
Chart |
News |
PowerRating) were both up small green, but remain on the list today, along
with
all of the above stocks from yesterday.
(
KLAC |
Quote |
Chart |
News |
PowerRating) was a good Trap Door as it traded from
the 53.15 entry level to a 54.55 high, closing at 54.08. KLAC went right along
with the SMH Trap Door where entry was above 41.15 and traded up to 41.95, closing
at 41.58. Those exact Trap Door setups are right in your First
Hour strategy module and also the seminar
material.
Today’s
Action
The reflex from Tuesday’s lows for the major indices
has been very weak, in both price, and especially volume. The Nasdaq and QQQs,
which were more short-term oversold, are both +2.0% off their lows, while the
SPX is +1.1%, as it has traded back and forth around the 20-day EMA line, which
is now 1141.92 vs. the 1144.91 close so it is once again our early pivot. Net
net, no fourth wave down indication yet for the SPX, as all of the 20-, 50-
89- and 200-day EMAs are rising, and that’s when you buy retracements until
proven otherwise. Those levels below the 20-day EMA are 1124, 1100 and 1049.
There is other confluence, but no need to mention it unless the price action
takes us there.
The unmitigated political BS that is not even in
full swing yet will be an unsettling factor going forward into the conventions,
so put your choppy market hat on and expect to make shorter-than-usual position
trades. Daytraders should profit from the opportunities created by the media
political hype. The adjustment for the longer-term index proxy positions, so
as to have a defined risk, yet still participate in most of any more upside,
has already been done into the 1150 – 1160 zone, so that eliminates any long-term
surprise or any emotional decision making and one can concentrate on the short
term.
If this current weak two-day reflex heads south
today or Monday, it will be played from the short side with futures/index proxies,
and I would expect using the SPX because it has some catch-up downside room.
If the reflex picks up some enthusiasm, the names on this monitor will be, in
the energies, NBR, BJS, RIG, BHI, SLB, MUR, UCL and NE.
In the brokers, which are still set up, it
would
be
(
GS |
Quote |
Chart |
News |
PowerRating),
(
MWD |
Quote |
Chart |
News |
PowerRating),
(
LEH |
Quote |
Chart |
News |
PowerRating),
(
MER |
Quote |
Chart |
News |
PowerRating) and
(
BSC |
Quote |
Chart |
News |
PowerRating).
In the semis, KLAC,
(
MCHP |
Quote |
Chart |
News |
PowerRating),
(
XLNX |
Quote |
Chart |
News |
PowerRating),
(
NSM |
Quote |
Chart |
News |
PowerRating) and also
(
STM |
Quote |
Chart |
News |
PowerRating).
Other stocks that also have good position
daily
chart setups are
(
FRX |
Quote |
Chart |
News |
PowerRating),
(
STJ |
Quote |
Chart |
News |
PowerRating),
(
DGX |
Quote |
Chart |
News |
PowerRating),
(
COF |
Quote |
Chart |
News |
PowerRating),
(
SYMC |
Quote |
Chart |
News |
PowerRating),
(
CDWC |
Quote |
Chart |
News |
PowerRating),
(
APOL |
Quote |
Chart |
News |
PowerRating),
(
EBAY |
Quote |
Chart |
News |
PowerRating),
(
LAMR |
Quote |
Chart |
News |
PowerRating),
(
HSIC |
Quote |
Chart |
News |
PowerRating) and
(
AMGN |
Quote |
Chart |
News |
PowerRating).
Have a good trading day,
Kevin Haggerty
P.S. You can finally learn
what traders have been asking me to teach them for years—