If The Generals Push This New Money, This Is Your Strategy
What Friday’s Action Tells
You
The major indices spiked on the opening,
trading
up to 1131 by the 11:35 a.m. ET bar and then went sideways in a 3 point
range
for the remainder of the session, closing at 1131.50. There was significant
program-trading volume in the first 30 minutes as the Generals put some
fourth
quarter money to work, in addition to some re-allocation in various
sectors.
The NYSE program-trading volume for September was almost 60%, and this is a
major factor for daytraders.
It was a big percentage day as the SPX
(
$SPX.X |
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PowerRating) was +1.5%,
(
QQQ |
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PowerRating) +2.7%, pushed by the semiconductors
with
the
(
SMH |
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PowerRating) +4.8% and the Nasdaq +2.4%. The Dow
(
$INDU |
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PowerRating) lagged at
+1.1%
with
(
MRK |
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PowerRating) as the drag.
NYSE volume was just below Thursday’s
quarter-ending volume of 1.75 billion with a 1.59-billioin-share day. The
volume
ratio was all one-sided at 86 and breadth +1613. The 4 MA of the volume
ratio
is 69 and breadth +936, but can extend it some more if the Generals push
the
fourth quarter allocation. After the SMH, the
(
OIH |
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Chart |
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PowerRating) was +2.2%, while the
banks and brokers were in line with the SPX, as were the other primary
sectors,
except the RTH which was +0.8%.
For Active
Traders
There were no real contra moves in the major
indices and then price went Slim Jim in a tight range for the rest of the
session.
However, some focus list stocks gave me some
good
trade setups, like
(
SYMC |
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PowerRating) with the Flip Top breakout above 56 on the
10:05
a.m. bar which traded to 57.18, closing at 57.20.
(
PCAR |
Quote |
Chart |
News |
PowerRating) gave you a delayed entry above
the
previous day’s 69.25 high, trading up to 70.75.
In the energy focus stocks, there was
opportunities like the Opening Reversal and also above the previous high for
(
DO |
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PowerRating) above 33, running quickly to 33.90.
(
SLB |
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Chart |
News |
PowerRating) gave you a 1,2,3
Higher
Bottom after hitting its intraday low at the 480 EMA. The 1,2,3 Higher
Bottom
entry was above 67.20 with entry on the 10:35 a.m. bar and trading up to
68.65.
These were all defined entries that you have
learned from the modules or seminar material. You just have to monitor your
list
each day, especially in the first hour, to check for these kinds of
setups.
The focus list emphasis will be greatly
expanded
with
the “Inner Circle.”
Today’s
Action
The QQQ had a wide-range-bar gap day trading
above its 1,2,3 trend entry price of 35.85 and its 200-day SMA at 35.81,
closing
at 36.10. They are today’s immediate downside intraday focus levels, or
maybe an
opening above the 36.15 high, which then reverses that high. The gap
reversal
might be taken early as the QQQ has advanced +5.6% over the past four days.
This
is being done Sunday night, so I don’t know what the early futures game will
be.
The SPX is right back to the downward trend
channel line with the previous swing point high at 1131.54 having closed at
1131.50. A re-cross of that swing point high will accelerate price and
squeeze a
few shorts. Just above is the 1135 – 1141 resistance level, with 1141 being
the
.786 retracement to 1163 from 1061.
The Dow Transports have made new rally highs,
as
have the Dow Utilities, so the 10,298 200-day SMA level is the immediate
upside
down focus.
The
(
IWM |
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Chart |
News |
PowerRating) — the Russell 2000 proxy —
made a
positive upside close above its downward trend line.
The QQQ runs into its down trend line around
37.25 – 37.50, while the Nasdaq has additional resistance from 1964 –
1990.
The SMH closed at 31.69 with a 1,2,3 trend
entry
above 32.18 and the 200- and 233-day EMAs up at 34.59 and 34.77. Price is
+8.4%
in three days and +5.6% from the 1,2,3 Higher Bottom entry above 30, so
intraday
retracement setups are preferred rather than a continuation entry above
32.18 if
the Generals push this new money for a few more days.
Advances in the last few days of a quarter
and
the first five days of the new quarter are the norm, not the exception, so
don’t
get carried away with price.
Have a good trading day,
Kevin Haggerty
