Jury Still Out
We got past the CPI and Greenspan without much turmoil, the bonds recovered nicely, and today we get triple witch behind us.
The S&P 500 hit a high of 1343.55 yesterday before closing at 1339.90, a fraction above the swing point high. Price action, breadth, and the up/down volume ratio were all positive, but volume couldn’t crack 700 million shares–a negative. Rising prices and declining volume are not what bull markets are made of. Let’s hope it’s because of triple witch and a day off to evaluate Greenspan’s speech before congress.
The S&P has now retraced 67% of the 1376 to 1277 move. Next week the onus is on the institutions to decide where we’re going. Goldman Sachs’ Abby Cohen came out positive yesterday, setting the stage for the money managers’ June mark-up. The earnings hype has started, so that might be a good catalyst.
The S&P 500 has to be up more than the current 8.5% by the end of June to get investors excited enough to pump more cash into the funds. Today should be very volatile; the trader graveyard for triple witch is full right now, so be a slave to price–don’t get cerebral today. Keep stops tight, and re-enter trades if need be, but don’t get run over. This is a great day to look for breakouts to new intra-day highs from long, tight consolidations. Scroll your five-minute charts all day.
Target Stocks Of The Day  Watch the following setups: Ascend Communications [ASND>ASND], C-Cube Microsystems [CUBE>CUBE], Qualcomm [QCOM>QCOM], Legato Systems [LGTO>LGTO], ANDRX Corp. [ADRX>ADRX], Litton [LIT>LIT], Unum Corp. [UNM>UNM], and Metromedia Fiber Networks [MFNX>MFNX]. In the energies, you can take either Baker Hughes [BHI>BHI] or Halliburton [HAL>HAL]; they’re both the same pattern.
Program trading numbers  Buy: 15.25. Sell: 10.60. Fair Value: 13.05. Remember, the institutions without commissions will be executing programs at tighter levels, so keep watching the ticks.
Editor’s note: If you want to learn more about Kevin Haggerty’s trading strategies, click on the link below to go to his new series of tutorial articles.