Well that was a fine howdy-do wasn’t it? I was not shocked to see an up move today at all, but I expected we would see some more selling into the end of the day today. When I looked at the v on a 5 minute frame, it was clearly evident that yesterday we had a build into the selling, and today we did not have that build at all. That being said, we did not really bust through into new areas, we are just hanging around the same old region. Let’s look at some charts:
well the VIX already broke down off my new “support” line. Some support eh? If it keeps going down, then the mkt. keeps going up. However, I did notice something today…
The UUP was only down .01 today. This doesn’t jive with today’s action. The v was good, and we did not breach to new lows. Keep an eye on this. As I type, it finished up .03 after hours.
The DOW still has not broke out, yes it had a very strong day on decent v, but not a breakout day. Remember the post I did on the size of the moves dow 10 k ? Well we are set up near perfect for our turn down. Obviously a crest to new highs would be very bullish.
The SPX bounced off support, and is poised in the same area for a good pullback. But until 1075 is breached, it will serve as support.
Funny thing about the COMPQ, yesterday this thing was a beast, the strength of a weak mkt. Today it was the bane of the mkt., it did NOT want to move up and only did after being reluctantly pulled up by the DOW, the strength of the day. By doing this we formed a bullish engulfing candle, but it is on a sideways move so not near as strong. It is now trapped in between support and resistance, and I waiting for a break to either side to pick my play ( currently have QQQQ puts, wish I would have bought some more at the end of the day today)
The RUT is in a rut and cannot seem to break above that resistance line, but is also seems to be bouncing of the 50 ma the last couple times it touched it. It still looks very toppy to me.
here’s a possible trade to munch on, EAT has found support after taking dive post earnings. BUT, it is below the 50 and 200 ma, and my guess is it will move sideways a bit before falling off this ledge. Also note this ledge is right near a fib, another reason for support.
WLT has formed itself a nice little double top, but it did have a nice hanging man doji today, so it could stall out. I would definitely wait for some follow thru, but the fact that the 20 is closing in on the 50 ma shows me it is likely heading that way.
A low v stock that has found support post e, on the 200 ma. I like this to bounce, but it can be played either side of the 200 with the 200 as the stop, a switch hitter.
Another low v stock, and a broker I use, OXPS on a simple up trend line. If it holds, and it sure looks like it will, play for the $1 move up, if it gives way I could see a $2 move down pretty easily.
Finally LXK leapt up into gap resistance with a gap of its own, and frankly I like this to fill the most recent gap. I would use a pretty liberal stop of $29.10 for intra day noise, but a potential down move of $4 it is worth it.
In closing; although I was befuddled by the strength today, when I go back to the charts, nothing looks out of whack. We are right about where I thought the tops of this up move would be and look to be turning over. We have made clear-cut breakout zones so that makes it easy to decide to go long. Right at the close today I bot calls on HON ( my risky earnings play I was talking about yesterday) and some puts on AMGN, so I will be watching both of those closely in the morning. I am not going to over react to either side after the housing numbers come out, but if things go right, I should be selling HON in the first hour of the day. If not, I will be selling very quickly, for a loss. I did not want to share that trade because I am going through earnings, which is not something I do often, but I had a reason for it. So now that it is done I am sharing with you. You can follow both those trades with me tomorrow morning and know if I am in pain or gain. Trade well and prosper. AKOT
Checking your charts has been added to my pre-market list. Thnx for your work.
Val
I really appreciate the comments. Most people don’t feel comfortable commenting so they email me or use the meebo thing to chat, so thanks. Hope people are getting some profitable ideas, cuz I certainly don’t play them all, just the ones that set up best for me. AKOT
Pure adreneline trade day. I was in GS, FCX and TNA long when the market turned. Squeezed out of both 45 bucks in the green. That’s OK The alternative (holding both) would have been painful. Waited for GS to break it;s Wed low…came w/i about 4 ticks but no go so I did not go long EOD. May regre that move next Mon. Half the blogs say we rally Mon and the other half say we tank. Could go either way so I am all in cash thru the wk-end and will sleep soundly.
Cheers and do your weekend right.