Still At The Gate
In
yesterday’s text, we said that
the two narrow-range days would be resolved quickly and your starting
points for the
(
SPX |
Quote |
Chart |
News |
PowerRating) were 1200.41 on the downside and 1209.05 on the upside.
The SPX traded in a tight 3-point range for the first half-hour, then gave us a
moonshot layup in the S&P futures. The SPX cash traded through 1209.05 and
ran to a 1222.74 high. If you took the futures trade, they ran 14 points to a
1227.50 high, and you didn’t even think about getting out until about the 1224
level, so you would have realized about 12 points before you got anything
resembling a reversal-bar pattern to exit. A simple continuation long entry
above the previous five days’ high and also the 20-day EMA. FYI: The lagging
indicators like stochastics were useless to you for this trade, and for those of
you hung up on them rather than a Change in Direction and buying/selling
pressure, you deserve to miss these trades. The volume ratio, breadth and sector
green said take the obvious continuation entry. The rally lasted until just
before 2:00 p.m. before the S&P futures traded right back down to the
morning breakout level. The SPX did also, closing at 1211.23. We had some nice
long entries and caught some energy shorts.
There is another life
away from the Junipers and Nintendo players that bang the keys all day in the
beach ball stocks. The money is also green when you catch decent moves like you
did yesterday in
(
CBE |
Quote |
Chart |
News |
PowerRating), +1 5/8,
(
CAH |
Quote |
Chart |
News |
PowerRating), +2.05, and
(
FITB |
Quote |
Chart |
News |
PowerRating), +1 1/2.
That’s all from entry to high. These stocks are more apt to be all Generals,
rather than cells of Nintendo players flexing them up and down. The point is
play both kinds of stocks.
We forewarned that the
highest probability was a price/time minor cycle low from July 23 through July
27, and that was in conjunction with month-end and the first few days of August
for some new cash to be put to work. That is exactly what we got.
The
(
NDX |
Quote |
Chart |
News |
PowerRating) has
advanced 8.5% high to low, and the SPX +5%. The down trend remains intact for
the NDX, which has yet to close above its down trend line and is below its
50-day EMA of 1742. Forget the 200. That’s up at 2170. If you’re waiting for
that to get long, good luck. The SPX closed above its down trend line for the
first time since the May 22 high, penetrated its 50-day EMA of 1219, but closed
in an afternoon down trend at 1211.23. Both indexes are at the starting gate,
but are reluctant to break out yet.
Today we start with early
green, as Merrill Lynch stroked the Semis. You know, the home of Henry Blodgett?
Many of the Semis have already gained between 20% and 30% during the brief rally
prior to today’s pre-market action.Â
(September
|
||
Fair Value
|
Buy
|
Sell
|
4.00
|
5.20 |
2.80
|
Stocks
Today
In the Semis, the
Generals continue to live here. So should you. Plenty of two-way action in
stocks like
(
NVDA |
Quote |
Chart |
News |
PowerRating),
(
BRCM |
Quote |
Chart |
News |
PowerRating),
(
KLAC |
Quote |
Chart |
News |
PowerRating),
(
NVLS |
Quote |
Chart |
News |
PowerRating),
(
AMAT |
Quote |
Chart |
News |
PowerRating),
(
RFMD |
Quote |
Chart |
News |
PowerRating)
and
(
MU |
Quote |
Chart |
News |
PowerRating). Also, for the first time, keep
(
INTC |
Quote |
Chart |
News |
PowerRating) on your screen. It looks
like it’s ready to make another attempt to come out of its base.Â
Other stocks:
(
VAR |
Quote |
Chart |
News |
PowerRating),
(
PX |
Quote |
Chart |
News |
PowerRating), in the papers, if they come for them today, they did yesterday, look at
(
GP |
Quote |
Chart |
News |
PowerRating) and
(
WY |
Quote |
Chart |
News |
PowerRating). Also,
(
LTR |
Quote |
Chart |
News |
PowerRating),
(
STT |
Quote |
Chart |
News |
PowerRating),
(
KEY |
Quote |
Chart |
News |
PowerRating),
(
FITB |
Quote |
Chart |
News |
PowerRating),
(
SLM |
Quote |
Chart |
News |
PowerRating),
(
HD |
Quote |
Chart |
News |
PowerRating),
(
YUM |
Quote |
Chart |
News |
PowerRating),
(
BAX |
Quote |
Chart |
News |
PowerRating),
(
COHR |
Quote |
Chart |
News |
PowerRating),
(
ENZN |
Quote |
Chart |
News |
PowerRating),
(
UNH |
Quote |
Chart |
News |
PowerRating),
(
HCR |
Quote |
Chart |
News |
PowerRating),
(
FDRY |
Quote |
Chart |
News |
PowerRating),
(
GSPN |
Quote |
Chart |
News |
PowerRating), and also the two best base-looking stocks that I see now are
(
MOT |
Quote |
Chart |
News |
PowerRating)
and
(
FON |
Quote |
Chart |
News |
PowerRating). You might have already put on a couple of option strategies there.Â
On the short side if they
continue there today in the Energies, look at
(
SLB |
Quote |
Chart |
News |
PowerRating),
(
APC |
Quote |
Chart |
News |
PowerRating),
(
APA |
Quote |
Chart |
News |
PowerRating),
(
BHI |
Quote |
Chart |
News |
PowerRating),
(
HAL |
Quote |
Chart |
News |
PowerRating), and also,
(
IDPH |
Quote |
Chart |
News |
PowerRating),
(
HGSI |
Quote |
Chart |
News |
PowerRating) and
(
PDLI |
Quote |
Chart |
News |
PowerRating) in the biotechs.
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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