Two And Out
The
Dow
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$INDU |
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+140 points and right back to the 10,600 level. Get your smokestacks. There will
never be another down day. Right. I don’t think there is a commentator left that
hasn’t said, "Buy the basics." Retail stocks went out green yesterday
along with the drillers, which made a nice upside reversal when the indices got
the 2:00 p.m. rocket shot.
The SPX
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$SPX.X |
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closed at 1162.77, above its 200-day EMA of 1155.87. The NDX
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$NDX.X |
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went out at 1520, or +1.4%, along with the Dow and SPX. It was a hat trick at
+1.4% for each of the major indices. The
(
$SOX.X |
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several majors, like Intel
(
INTC |
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(
MXIM |
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(
MCHP |
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green. Shorts are still covering in the semis.
NYSE volume was 1.526
billion, volume ratio of 81, with breadth excellent at +1405. The volume ratio
for the Nasdaq was 70 and 73 for the NDX 100. For the past five days, the NYSE’s
up-volume to down-volume ratio has averaged 2.8:1. Seventy percent of all the
S&P 500 stocks are above their 200-day moving averages. Volume in the
(
DIA |
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(
SPY |
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(
QQQ |
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prices, so be careful with any continuation long entries above yesterday’s high.
I am sure you realize
that second entries are a much higher probability in this kind of volatility. In
many stocks, it’s even a third entry before the stock makes the real move.
Getting stopped out twice makes one reluctant to go a third time. I adhere to
the axiom of "two and out." When the intraday volatility is high, take
smaller positions for more wiggle room. It also makes sense to spread your risk
over more positions.
Stocks
Today
If we get an early up,
don’t chase, as the SPX ran from 1152 to 1165 on yesterday’s 2:00 p.m.
explosion, and there will be profit-taking on any early fast up after the retail
get out of the way.
Stocks to focus on, long
setups, if they continue for the basics, look at
(
DD |
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(
WY |
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(
AA |
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(
PX |
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In the drillers,
(
BJS |
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(
RDC |
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(
NE |
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In the retailers,
(
ANN |
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PowerRating) and
(
TGT |
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PowerRating).
Also,
(
MAS |
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(
RTN |
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(
LUV |
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(
YUM |
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PowerRating).
In the biotechs, look at
(
AMGN |
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(
CEPH |
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And also,
(
BR |
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(
FRX |
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(
NEM |
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PowerRating).
Have a good trading day.
Five-minute chart of
Wednesday’s SPX with 8-, 20-,
60- and 260-period
EMAs
Five-minute chart of
Wednesday’s NYSE TICKS
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