The Beat Goes On
The beat
goes on and if you are buying
weakness and selling strength in this news market, it’s the only way to ring the
register if you are a position trader. That certainly won’t change until we
trend up again. For the Nasdaq 100
(
NDX |
Quote |
Chart |
News |
PowerRating), that can’t even start until it at least breaks the down trendline and
50-day EMA, which are both at the 1786 level, or else we trade lower toward the
.786 zone which is 1504. For the S&P 500
(
SPX |
Quote |
Chart |
News |
PowerRating), the 50-day EMA is at the 1228 level, and gets going above the down
trendline which is above 1220. Further downside below 1168 takes the SPX to the
.786 zone which is 1131.
There are many stocks that
are dancing to their own drummers, challenging and/or making new 52-week highs
above all of their rising EMAs but it is always obviously a stronger game when
your top down look — which is the overall strength of the major indexes — is
in gear, because that always makes you "smarter." I think many who
mistook the bull market for brains have learned some humility but you can bet
that this new-era group of money managers won’t get caught again in a parabolic
frame of greed.
Yesterday going into the
daytrading battle, we focused on those stocks that were beaten down the day
before on increased volume, range and percentage moves. That was primarily the
semis and biotechs. We were rewarded. I said that there would be intraday setups
in over one half of the 15 mentioned stocks and in fact, there was that, and
then some.
You had many clearly
defined setups starting with Trap Doors, Opening Reversals, Volatility Bands,
1,2,3’s both ways, First Consolidation Breakouts to New Intraday Highs, Slim
Jims and Fib retracements. These are defined entry patterns that you can easily
see — and if it’s not easy to recognize, I strongly recommend you don’t take
it.
Today we start out early
red at 8:30 a.m. ET, with the S&Ps -10, the NDX futures -27. We also have
PPI numbers at 8:30 a.m., more earnings today such as
(
IBM |
Quote |
Chart |
News |
PowerRating), not to forget
the Greenspan mumble to Congress this afternoon.
(
INTC |
Quote |
Chart |
News |
PowerRating), after the close
last night, traded below 29 and that’s when I signed off to return to the real
world and have dinner, knowing it didn’t mean bupkis as the game starts
new every morning at 9:30 a.m. when the real money determines the rules, not the
pre-opening Disney World.
(September
|
||
Fair Value
|
Buy
|
Sell
|
5.80
|
7.00 |
|
Stocks
Today
We certainly want to be
involved intraday in the semis and biotechs, because that’s where the volatility
is.
(
KLAC |
Quote |
Chart |
News |
PowerRating) looked through
a different crystal ball yesterday than the
(
AMAT |
Quote |
Chart |
News |
PowerRating) chairman did the day
before, and implied that the sector had bottomed. The beat goes on.
In the semis today, if
you’re looking for setups either way, long or short whichever way they want to
play the game, start with
(
AMAT |
Quote |
Chart |
News |
PowerRating),
(
NVLS |
Quote |
Chart |
News |
PowerRating),
(
KLAC |
Quote |
Chart |
News |
PowerRating),
(
ALTR |
Quote |
Chart |
News |
PowerRating),
(
BRCM |
Quote |
Chart |
News |
PowerRating),
(
MU |
Quote |
Chart |
News |
PowerRating),
(
NVDA |
Quote |
Chart |
News |
PowerRating),
(
QLGC |
Quote |
Chart |
News |
PowerRating), and also
(
PMCS |
Quote |
Chart |
News |
PowerRating) is starting to look
interesting.
In the financials, either
long setups from the daily charts (and remember, no entry, no loss):
(
FITB |
Quote |
Chart |
News |
PowerRating),
(
AIG |
Quote |
Chart |
News |
PowerRating),
(
FNM |
Quote |
Chart |
News |
PowerRating),
(
CNA |
Quote |
Chart |
News |
PowerRating) and
(
STT |
Quote |
Chart |
News |
PowerRating).
A few other miscellaneous
stocks that set up long on the daily charts are:
(
CTXS |
Quote |
Chart |
News |
PowerRating),
(
VRSN |
Quote |
Chart |
News |
PowerRating),
(
ATVI |
Quote |
Chart |
News |
PowerRating)
and
(
BRKS |
Quote |
Chart |
News |
PowerRating).
In the biotechs, take
yesterday’s list and add
(
BGEN |
Quote |
Chart |
News |
PowerRating) because of the increase in volume it had
yesterday — you’re looking for setups both ways. There will be a lot of
volatility in those stocks and a lot of clearly defined patterns.
Have a great trading day.
Tuesday’s S&P 500 five-minute chart
with 8-, 20-, 60-
and 260-period
EMAs.
Tuesday’s NYSE
TICK five-minute chart
Do you have a follow-up question about something in this column or other questions about trading stocks, futures, options or funds? Let our expert contributors provide answers in the TradingMarkets Trading Advisor! E-mail your question to questions@tradingmarkets.com.
For the latest answers to subscriber questions, check out the Q&A section, linked at the bottom-right section of the TradingMarkets.com home page.