Lots Of Stocks Setting Up Every Day — Here’s One Way To Find Them
What Thursday’s Action Tells
You
Relative to the major index prices, it was a push
at the close, with the SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) +0.1%, and also the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating)
at +0.1% due primarily to
(
IBM |
Quote |
Chart |
News |
PowerRating), which was +4.1%, on the earnings gap opening
to 95.07 that traded down to 93.59 by the 10:15 a.m. ET bar. The specialists
made a nice chop on that opening and deserve it, as all of the emotional buyers
just had to own it on the opening. They deserve what they get. It actually held
up better than I thought it would for the remainder of the session, closing
at 94.05.
You can see the option expiration activity
yesterday, as NYSE volume expanded to 1.67 billion, yet the volume ratio was
neutral at 51, as was the breadth at only -23. I guess you could call it a
50/50
day, and the winners of the raffle were the daytraders as I will show you in
a
little bit. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed flat, just -2 points, while
the
(
QQQ |
Quote |
Chart |
News |
PowerRating)s were +0.3%.
In spite of the neutral day, six primary sectors
outperformed the major indices, which is good, but I can’t read into it too
much with the Friday expiration activity, although I think a good portion of
it was completed Thursday.
| size=2> |
Friday
1/9 |
Monday
1/12 |
Tuesday
1/13 |
Wednesday
1/14 |
Thursday
1/15 |
| color=#0000ff>Index | |||||
| color=#0000ff>SPX | |||||
| color=#0000ff>High |
1131.92
|
1127.85
|
1129.07
|
1130.75
|
1137.11
|
| color=#0000ff>Low |
1120.90
|
1120.90
|
1115.19
|
1121.22
|
1124.50
|
| color=#0000ff>Close |
1121.86
|
1127.23
|
1121.22
|
1130.52
|
1132.05
|
| color=#0000ff>% |
-0.9
|
+0.5
|
-0.5
|
+0.8
|
+0.1
|
| color=#0000ff>Range |
11
|
7.0
|
13.9
|
9.5
|
12.6
|
| color=#0000ff>% Range |
10
|
90
|
43
|
98
|
63
|
| color=#0000ff>INDU |
10459
|
10485
|
10427
|
10538
|
10554
|
| color=#0000ff>% |
-1.3
|
+0.3
|
-0.6
|
+1.1
|
+0.1
|
| color=#0000ff>Nasdaq |
2087
|
2112
|
2096
|
2111
|
2109
|
| color=#0000ff>% |
-0.6
|
+1.2
|
-0.7
|
+0.7
|
-0.1
|
| color=#0000ff>QQQ |
37.74
|
38.35
|
37.95
|
38.25
|
38.18
|
| color=#0000ff>% |
-0.6
|
+1.6
|
-1.0
|
+0.8
|
+0.3
|
| color=#0000ff>NYSE |
|
|
|
|
|
| color=#0000ff>T. VOL |
1.67
|
1.47
|
1.55
|
1.51
|
1.67
|
| color=#0000ff>U. VOL |
615
|
914
|
608
|
1.11
|
849
|
| color=#0000ff>D. VOL |
1.04
|
535
|
921
|
376
|
814
|
| color=#0000ff>VR |
37
|
63
|
40
|
75
|
51
|
| color=#0000ff>4 MA |
53
|
56
|
52
|
54
|
57
|
| color=#0000ff>5 RSI |
60
|
67
|
55
|
67
|
69
|
| color=#0000ff>ADV |
1639
|
2079
|
1627
|
2236
|
1638
|
| color=#0000ff>DEC |
1661
|
1230
|
1687
|
1047
|
1661
|
| color=#0000ff>A-D |
-22
|
+849
|
-60
|
+1189
|
-23
|
| color=#0000ff>4 MA |
+284
|
+460
|
+386
|
+489
|
+489
|
| color=#0000ff>SECTORS |
|
|
|
|
|
| color=#0000ff>SMH |
-0.2
|
+2.2
|
-2.4
|
-0.2
|
+1.2
|
| color=#0000ff>BKX |
-0.4
|
-.01
|
-0.7
|
+0.8
|
+0.8
|
| color=#0000ff>XBD |
-0.9
|
+1.1
|
-0.2
|
+1.6
|
+1.2
|
| color=#0000ff>RTH |
-0.3
|
-0.3
|
+0.7 |
+0.8
|
+0.7
|
| color=#0000ff>CYC |
-1.0
|
+0.6
|
-0.2
|
+0.8
|
-.07
|
| color=#0000ff>PPH |
-0.8
|
-0.1
|
-0.6
|
+0.1
|
+.05
|
| color=#0000ff>OIH |
+3.8
|
-0.7
|
-0.4
|
-1.6
|
-1.7
|
| color=#0000ff>BBH |
-.04
|
-0.2
|
-0.2
|
+0.5
|
+0.8
|
| color=#0000ff>TLT |
+1.8
|
-.08
|
+0.7
|
+0.4
|
+0.4
|
| color=#0000ff>XAU |
+1.4
|
-1.7
|
-2.7
|
-4.1
|
-4.0
|
^next^
For Active
Traders
The traders won the game yesterday, as there were
three SPX moves that all had good travel range, in spite of the flat major indices.
The first was the SPX Trap
Door below 1132.30 from the extension zone, and if you didn’t enter on the
Trap Door, you caught the three-bar reversal below 1130.20. The SPX traded down
to the 1124.50 intraday low, which was right at the 240 EMA. On Wednesday, you
got a good ride from a 240 EMA trade after the 1123.97 low.
The second trade from the 240 EMA yesterday
carried up to another extension zone and an 1137.11 intraday high before a
three-bar reversal below 1135.50 to 1129.90. There was also a negative
divergence in the 8,3,3 slow stochastic at the 1137.11 high. I have also
included the ESH4 chart which has a slightly different 240 EMA simply
because it
trades before 9:30 a.m. The pattern setup should always defer to the SPX
cash
index, and you should have all three charts up at the same time: ESH4, SPX
and
SPY. The only time you don’t is on opening reversals, and you should defer
to
the SPY. The ESH4 entry was on the same 10:20 a.m. bar as the SPX, which
followed the 1123 low.
In the homebuilders, Pulte Homes
(
PHM |
Quote |
Chart |
News |
PowerRating) gave
us an RST/Trap
Door short entry below 44.22 and traded down to 43.20 in just six bars at
10:10 a.m. after entry on the 9:45 a.m. bar. From there, after the seller walked
away, PHM rallied to 44.39, closing at 43.98.
(
KBH |
Quote |
Chart |
News |
PowerRating) had the better buy pattern
setup yesterday from an ascending triangle breakout to new intraday highs above
68.15 which ran to 69.24 before fading to a 68.49 close. The point is I said
stay all over these stocks because the Generals and hedge funds are active both
ways, and we will also catch some sharp short-covering reflexes as we go.
The
(
SMH |
Quote |
Chart |
News |
PowerRating)s, at +1.2%, acted well with
(
INTC |
Quote |
Chart |
News |
PowerRating)
down -1.1%, and they also traded up to a retracement level to the 45.78 high,
hitting 45.40, but faded into the 45.05 close. It wasn’t about the SMHs, however,
because the real red meat was
(
QLGC |
Quote |
Chart |
News |
PowerRating) which hit 46 on the 9:30 a.m. opening
bar, down -8.7% from the previous 50.36 close. I just sat there with the volatility
band printout and went through all of the semis as they opened to see which
ones were extended the most, and QLGC got the nod. The 2.0 volatility band was
47.85, and I quickly calculated the 3.0 volatility band, which was 46.61 and
the take was after QLGC reversed it to the upside. It didn’t run as much as
I thought, but still got to 48.19 and closed at 47.70. The out was on the reversal
of the 47.86 low of the high bar. I keep that printout in front of me all day
every day. Why be satisfied with waiting for, say, the ESH4 or SPY at volatility
bands, when there are multiple volatility band trades in different stocks every
day. “More is more, Yogi.”
The best of the bunch was
(
PD |
Quote |
Chart |
News |
PowerRating) again, which
has gone south below the 80 – 76 box. We caught that stone cold yesterday. It
reversed a Slim
Jim between 74 – 73.58 from the previous day which was in place from 11:05
a.m. until the 4:00 p.m. close. Yesterday it gave us an opening reversal below
73.58 with entry on the 9:40 a.m. bar which also took out the previous day’s
long narrow-range Slim Jim. This was simply a by-the-First-Hour-module
trade. PD traded down to 70.85, closing at 70.96. Have a nice day. It has been
a focus stock, so you should have been ready for it on the breakout of the Slim
Jim.
There will be no commentary on Monday as I will
doing the long weekend thing, but you know where the focus is, so keep scrolling
people, and catch that wind.
Have a good trading day,
Kevin Haggerty
