You’ll find something in play today, regardless of what the major indices do
Kevin Haggerty is
the former head of trading for Fidelity Capital Markets. His column is
intended for more advanced traders. Kevin has trained thousands of traders
over the past decade. If you would like to be trained by him,
ext. 1
The major indices gapped up on the open after the
oil news and put in an extended day to the +2.0 volatility band zones and
closing there with a last-hour final push which, for example, took the SPX
(
SPX |
Quote |
Chart |
News |
PowerRating) from 1229.90 to a 1233.90 close, +1.3% on the day. The initial SPX
contra move was small from the 1225.98 9:45 a.m. ET high (vs. Friday’s 1218
close) to just 1223.52 before reversing and resuming the direction of the open.
The Dow was +1.4% to 10,589, the
(
QQQQ |
Quote |
Chart |
News |
PowerRating) +1.5% to 39.34 and the Nasdaq
(
COMPQ |
Quote |
Chart |
News |
PowerRating) +1.2% to 2167.
NYSE volume was 1.42 billion shares with a volume
ratio of 82 and breadth +1500. The 4 MA of the volume ratio is now 65 and 4 MA
of breadth +952, so it is moving into the short-term overbought zone for the
first time since the 08/03 1245.86 SPX high. The SPX is three days off its
19-day decline to 1201.06 from 1245.86, so short-term overbought can remain that
way for a few days. The 5 RSI is 73.4 and is >70 for the first time since 07/28.
The .618 retracement to 1245.86 is 1234.93 vs. yesterday’s 1233.61 intraday
high.
The sectors were all green, except the
(
XAU |
Quote |
Chart |
News |
PowerRating), which
was -0.5%, as interest rates increased slightly, with the
(
TLT |
Quote |
Chart |
News |
PowerRating) -0.7%. The
RTH (retail) led the primary sectors at +2.5% coming off the “Generals’
Pullback” to the rising 200-day EMA, and I see from the e-mails that some of you
caught trades yesterday like the
(
HD |
Quote |
Chart |
News |
PowerRating) 14-day breakout above 41 which traded
up to a 41.82 intraday high and closing at 41.71. The other fertile area for
daytraders yesterday was the sharp morning decline after the up opening by the
energy stocks. The
(
OIH |
Quote |
Chart |
News |
PowerRating) declined to a 116.57 intraday low and 816 EMA on
the five-minute chart (same as 34 EMA on 120-minute chart). Entry was above
116.81 on the 11:15 a.m. bar, which traded up to a 119.44 high and 119.30 close.
There were, of course, similar trades in many of the OIH component individual
stocks. QQQQ traders had a
Flip Top entry above 39.02 which ran to 39.35 by the
10:40 a.m. bar and then went sideways until 3:15 p.m. when the QQQQ hit 39.41,
closing at 39.34.
Net net, the basic strategies continue to repeat
on a daily basis, and there is always something in play, regardless of what the
major indices do, but you only find them if you anticipate the levels and are
prepared to trade them when they get there.
Have a good trading day,
Kevin Haggerty
