Traders’ Sector Selection
Kevin Haggerty is a full-time
professional trader who was head of trading for Fidelity Capital Markets for
seven years. Would you like Kevin to alert you of opportunities in stocks, the
SPYs, QQQQs (and more) for the next day’s trading?
Click here for a free one-week trial to Kevin Haggerty’s Professional
Trading Service or call 888-484-8220 ext. 1.
Daytraders caught the 1st Hour -1.0 Volatility
Band Trap Door reversals on Tuesday/Wednesday, and yesterday it was an RST short
on the 10 AM bar below 146.24 on the SPY and below 1460.82 for the SPX.
The SPY traded down to 145.23 and the SPX to 1450.51. The 1st Hour
Reversal strategies caught the primary trend all 3 days. The commodity
sector stocks made another positive reversal the last 2 days, and there were
multiple opportunities, especially in the energy stocks. The SPX finished
almost flat at 1456.38 (-.09%), while the $INDU was -0.4% to 12686. NYSE
volume is still on the lighter side at 1.47 billion shares, with the volume
ratio 51 and breadth -203. Both the MDY and IWM continue to outperform the
SPX/$INDU. The semis gapped up on the open, as the “herd” chased the
earnings/guidance news like ADI. The SMH was +2.7% while the other leader
was energy, with the OIH +1.9% and XLE +1.1%.
The commodity sector strength since 1/11/07 is
evidenced by the DBC (+12.8%), and $CRX (Morgan Stanley Commodity-Related Index)
+11.8% versus the SPX +2.2%. The OIH made a +11.7% run to 140.50 from
125.81, pulled back to 133.50 and closed yesterday at 139.44. Gold has
accelerated with the GLD advancing +13.5% from the 1/5/07 59.66 low (200-dema)
to a 67.71 high on Wednesday before closing yesterday at 67.17. That tells
you a different story from what Bernanke is spouting to Congress. The
current commodity sector move has been a bonanza for daytraders who know how to
take advantage of the intraday volatility and reversal strategies.
March has a very significant time period (trading
service members), and the probabilities are a downside reversal, but at the very
least, a significant increase in volatility, so daytraders should prosper in
March.
Have a good trading day,
Kevin Haggerty
