Look To Get Involved In The SMHs If Anybody Shows Up
What Thursday’s Action Tells
You
The SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) closed at 1128.59,
+0.2%,
but it was the third day in the past five that the daily range was below 7
points with a 6.7 point range yesterday. The Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) was also
+0.2% at
10,496. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) ended at +0.3% following the -2.5%
(
CSCO |
Quote |
Chart |
News |
PowerRating) day. The
(
QQQ |
Quote |
Chart |
News |
PowerRating)s were +0.4% at 36.46 and in the zone that I’m
interested in.
NYSE volume was 1.57 billion, volume ratio
58,
with the 4 MA still below 50 at 49. Breadth said nothing yesterday at just
+208.
The 4 MA is -223.
The sectors, other than retail with the RTH +1.2%,
were mixed and choppy, with the
(
SMH |
Quote |
Chart |
News |
PowerRating) +0.4%, CYC +0.6%, and the BKX -0.3%
and XBD -0.4%. The OIH declined for the third day at -1.7%.
| size=2> |
Friday
1/30 |
Monday
2/2 |
Tuesday
2/3 |
Wednesday
2/4 |
Thursday
2/5 |
| color=#0000ff>Index | |||||
| color=#0000ff>SPX | |||||
| color=#0000ff>High |
1134.17
|
1142.58
|
1137.44
|
1136.03
|
1131.17
|
| color=#0000ff>Low |
1127.73
|
1127.87
|
1131.33
|
1124.74
|
1124.44
|
| color=#0000ff>Close |
1131.12
|
1135.26
|
1136.03
|
1126.53
|
1128.59
|
| color=#0000ff>% |
-0.3
|
+0.4
|
+.07
|
-0.8
|
+0.2
|
| color=#0000ff>Range |
6.4
|
14.7
|
6.1
|
11.3
|
6.7
|
| color=#0000ff>% Range |
53
|
50
|
77
|
16
|
62
|
| color=#0000ff>INDU |
10489
|
10499
|
10505
|
10471
|
10496
|
| color=#0000ff>% |
-0.2
|
+0.1
|
+.06
|
-0.3
|
+0.2
|
| color=#0000ff>Nasdaq |
2066
|
2063
|
2066
|
2014
|
2020
|
| color=#0000ff>% |
-0.1
|
-0.1
|
+0.1
|
-2.5
|
+0.3
|
| color=#0000ff>QQQ |
37.08
|
36.97
|
36.95
|
36.34
|
36.46
|
| color=#0000ff>% |
-0.4
|
-0.3
|
-.05
|
-1.6
|
+0.4
|
| color=#0000ff>NYSE |
|
|
|
|
|
| color=#0000ff>T. VOL |
1.64
|
1.58
|
1.48
|
1.62
|
1.57
|
| color=#0000ff>U. VOL |
866
|
880
|
644
|
422
|
915
|
| color=#0000ff>D. VOL |
744
|
657
|
824
|
1.18
|
650
|
| color=#0000ff>VR |
54
|
57
|
56
|
26
|
58
|
| color=#0000ff>4 MA |
39
|
43
|
52
|
48
|
49
|
| color=#0000ff>5 RSI |
40
|
48
|
50
|
35
|
40
|
| color=#0000ff>ADV |
1701
|
1787
|
1691
|
895
|
1744
|
| color=#0000ff>DEC |
1546
|
1506
|
1603
|
2362
|
1536
|
| color=#0000ff>A-D |
+155
|
+281
|
+88
|
-1467
|
+208
|
| color=#0000ff>4 MA |
-655
|
-480
|
-91
|
-236
|
-223
|
| color=#0000ff>SECTORS |
|
|
|
|
|
| color=#0000ff>SMH |
+0.3
|
-1.4
|
+0.9
|
-2.7
|
+0.4
|
| color=#0000ff>BKX |
+.08
|
+.05
|
-0.2
|
-0.5
|
-0.3
|
| color=#0000ff>XBD |
+0.5
|
-0.2
|
+0.1
|
-1.9
|
-0.4
|
| color=#0000ff>RTH |
-.04
|
+0.3
|
-0.1
|
+0.6
|
+1.2
|
| color=#0000ff>CYC |
-0.3
|
-0.5
|
-0.7
|
-1.1
|
+0.6
|
| color=#0000ff>PPH |
-0.8
|
+1.2
|
+0.8
|
+0.8
|
+0.1
|
| color=#0000ff>OIH |
-0.9
|
+1.2
|
-0.6
|
-0.4
|
-1.7
|
| color=#0000ff>BBH |
-1.3
|
+1.9
|
+0.4
|
-1.6
|
-0.4
|
| color=#0000ff>TLT |
+0.7
|
-0.3
|
+0.5
|
-0.3
|
-0.4
|
| color=#0000ff>XAU |
+1.6
|
+0.5
|
-0.1
|
-1.5
|
+1.4
|
^next^
For Active Traders
After the QQQs early up to 36.64 on the 10:00 a.m.
ET bar, they declined to 36.34 and held the previous 36.33 low. That rally ran
to 36.70 before fading to close at 36.47. That 36.33 level held four times on
Wednesday and is a support zone from the previous breakout of the 36 – 34 box
to the 39 high. You have to play intraday at least on these kinds of retracements
because of the favorable reward-to-risk. If you don’t, it’s just your emotions
controlling your trading. Kind of like a market guru who says, “I care
on a retracement to a specific level,” and when it gets there, you never
hear from them because they are afraid they will be wrong. It’s not about that.
It’s about taking the highest probability trades in whatever your time period
is over the course of the year.
The
(
SPY |
Quote |
Chart |
News |
PowerRating) gave you an RST entry above
112.90
with the stop just below 112.78. The trade ran to a 113.54 high, then faded
into
the close. If you had trouble finding the 3,2,1 sequence, check your chart
again. It will jump out at you. You anticipate these RSTs in advance, and
after
yesterday’s action, you can see that the RST buy pattern today will set up
if
price trades below 112.78.
Today’s
Action
Today is the eighth day down from the highs
for
the SPX, closing yesterday at 1128.59 with the 20-day EMA at 1129.70, so
that’s
the early pivot up. However, we have the “first Friday of the month
dance” at
8:30 a.m., always accompanied by media hype, especially from the empty suit
in
Chicago that makes every report sound like the Super Bowl. If there is a
reaction, chances are good that the game starts enough above or below the
pivot
so that will affect any pivot entry, at least initially.
The SPX is -2.5% on a close-to-close basis so
far, and -2.85% high-to-low. There hasn’t been a 3.0% close-to-close
retracement
since the move into the Sept. 30 995.31 close and just below the 50-day EMA.
The
50-day EMA now is down at 1107. The previous three retracements were all to
the
50-day EMA, but since Dec. 11, the price has played the game above the
20-day
EMA where the SPX has been hanging out the last seven days.
The QQQs, on the other hand, are just below
the
50-day EMA of 36.62 having closed at 36.47 and above that 36 – 34 box, so I
have
more interest in a QQQ setup here.
The SMHs have declined -11.8% high-to-low in
16
days, leading the SPX. They closed at 40.70 vs. the 89-day EMA at 40.82,
with
the 50-day up at 42.11. It’s fill or kill right here for a reflex, or else
the
trip continues down to the 37 – 38 zone vs. the 200-day EMA at 37.11. The
previous retracement that bounced off the 38.41 low was also from the 89-day
EMA. Net net, look to get involved if anybody shows up today.
(
INTC |
Quote |
Chart |
News |
PowerRating) closed at 29.95 and in a key
zone,
with the 30-week EMA below at 29.39 and the 40-week 28.23.
I hope some of you are scrolling for the Generals
pullback setups you learned at the
seminar because there are some good ones there because of the rotation of
sectors, despite the SPX being down less than 3.0%.
Another sector that has pulled back, today is
the
eighth day of the pullback, is the OIHs, so I’ll be scrolling for some of
those
stocks today for any reflex, including the OIHs.
Have a good trading day,
Kevin Haggerty
P.S. You can finally
learn what traders have been asking me to teach them for years—