SOX Flip-Flop
In
light of what’s going on, the
markets behaved better than expected. The Dow ended -0.2%, and the SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
-0.5%, but the NDX 100
(
$NDX.X |
Quote |
Chart |
News |
PowerRating) was -2.7%, primarily due the flip-flop of
the
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), which ended the session -5.9% vs. a gain of 5% the previous
day. The four-day squeeze left most of them very extended. For example,
(
KLAC |
Quote |
Chart |
News |
PowerRating)
ran from 28.61 to 36.85, or +29%, which was right to its 20-day EMA of 35.86. It
reversed yesterday, opening at 36.20, then trading below your short pivot point
of 35.86, closing at 32.92. That kind of volatility is why you want the semis on
your screen for excellent two-way intraday action. Everyone is involved:
Generals, hedge funds fronting the Generals, and the shorts covering as the
Generals squeeze them.
(
NVDA |
Quote |
Chart |
News |
PowerRating) was squeezed for a 53% gain in five days;
(
QLGC |
Quote |
Chart |
News |
PowerRating)
ran 75% on significant volume.
The SPX has run 14.7%,
low to high, in 10 days, without any retracement to the 945 low. A .50
retracement would take it down to the 1014 level and the .618 at 998. The index
has consolidated in a narrow range the past three days, and the
(
SPY |
Quote |
Chart |
News |
PowerRating)s
trading below 105.35 is a four-bar downside reversal to start the retracement.
The SPX closed at 1056.78, just under the 20-day EMA at 1058.78 and if crossed
could give us an early up, seeing that there is pre-opening green in the
futures. The market is, and will remain, event driven, and it will test the 945
low, so refrain from buying up into the moving averages after a 10-day move
because you are afraid of missing the big one.Â
Stocks
Today
In the semis, stay
involved both ways in the
(
SMH |
Quote |
Chart |
News |
PowerRating)s,
(
BRCM |
Quote |
Chart |
News |
PowerRating),
(
KLAC |
Quote |
Chart |
News |
PowerRating),
(
NVLS |
Quote |
Chart |
News |
PowerRating),
(
AMAT |
Quote |
Chart |
News |
PowerRating),
(
NVDA |
Quote |
Chart |
News |
PowerRating) and
(
QLGC |
Quote |
Chart |
News |
PowerRating). KLAC, QLGC and NVDA have all traded up into their
moving averages, so be careful if you take a long intraday trade, as most all of
the semis set up as continuation shorts on the daily chart.Â
Daily chart long setups
are
(
TEVA |
Quote |
Chart |
News |
PowerRating),
(
SEPR |
Quote |
Chart |
News |
PowerRating),
(
WLP |
Quote |
Chart |
News |
PowerRating),
(
FRX |
Quote |
Chart |
News |
PowerRating) and
(
UNH |
Quote |
Chart |
News |
PowerRating).
Other continuation short
setups on the daily chart are
(
VRSN |
Quote |
Chart |
News |
PowerRating),
(
MXIM |
Quote |
Chart |
News |
PowerRating) and
(
EDS |
Quote |
Chart |
News |
PowerRating).Â
Have a good trading day.
Five-minute chart of
Tuesday’s SPX with 8-, 20-,
60- and 260-period
EMAs
Five-minute chart of
Tuesday’s NYSE TICKS
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