This Is The Common Thread I See
The
market again had a positive tone,
as NYSE volume expanded to 1.4 billion,
volume ratio strong at 70, and breadth good at +987. The major indices were all
green, with the SPX
(
$SPX.X |
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$INDU |
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$COMPQ |
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(
QQQ |
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traded up after the close. The
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SMH |
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As I do this at 6:15 a.m.
ET, the S&P futures are now +7, the Dow +54, and the Nasdaq +21. This is Easter
weekend, with the exchanges closed on Good Friday, so anything to the upside
shouldn’t be a surprise. The two SPX magnets are right above, which are the
200-day EMA at 905.64 and the 12-month EMA at about 915. The closing range SPX
Slim Jim from Monday proved to be support and good entry yesterday. (See
yesterday’s commentary.) The SPX traded down to 881.85 on the 9:35 a.m. bar,
then re-crossed 882, trading up to 886.47 by the 9:55 a.m. bar.
If you missed that, you
got a second chance on a pullback to 882.09 on the 10:10 a.m. bar. This trade
ran up to 891.27 by the 11:45 a.m. bar. After a retracement to 884.32, the SPX
traded up for the last two hours, closing at 890.81, right at the top of its
range. The QQQs gave you an RST entry above 25.95, which traded up +1.4% to an
intraday high of 26.31, closing at 26.28.
If they can run the major
indices up to the near-term magnets, we will find out really quickly what the
Generals want to do. Implied volatility is trading below historic volatility and
for the last two days, the AIV for the SPX has been below 22. We have been here
several times before on retracements to declining longer-term moving averages,
so be nimble.
Looking at the daily
screens for the S&P 500 and the NDX, you will see some Generals’ activity
evidenced by volume and price in stocks like
(
CHKP |
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(
JNPR |
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were ready for
(
BBBY |
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trading range at all-time highs. In the semis,
(
KLAC |
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a leader if the semis can sustain another rally. There was a volume and price
thread in some of the biotechs yesterday, and the
(
BBH |
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reach that first price objective around 103 after having pulled back to recent
support.
Looking at the
3-day Wake Up Call screen, the common thread is the financials, which makes
up almost half the list. On the
Change In Direction screen, you see a broker thread with
(
MWD |
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(
BSC |
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(
LEH |
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(
LXK |
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PowerRating),
one of your suggested scrolling stocks, was also on this screen. The point of
this exercise is to get you to focus on these screens daily to identify where
the Generals are putting their money because that will be where you will get
your best trades.
The next commentary will
be Monday, as I am leaving on a plane early this morning, so have a great
holiday.
Â
Five-minute chart of
Tuesday’s SPX with 8-, 20-,
60- and 260-period
EMAs
Five-minute chart of
Tuesday’s NYSE TICKS