The markets sold off on light volume today. The Dow Jones Industrial Average (DIA), Russell 2000 (IWM), Financials (XLF), and Nasdaq (QQQQ) all showed relative weakness to the S&P 500 (SPY) today. The VIX only rose 1.5%, which is not really enough to confirm the move lower. The TRIN and TRIN/Q both finished the day in bearish territory, indicating more volume flowing into stocks on the decline than stocks on the rise. That is a bearish sign. The TICK and TICK/Q were fairly neutral with some bearish bias, especially into the close.
On the daily chart of SPY we made a higher high and a higher low today, which is technically bullish, but in reality, today’s move was a little more bearish than bullish. We really need to see a close higher than today’s highs in order to mark a swing low here.
There are a bunch of potentially market moving earnings reports coming out before tomorrow’s trading session, so keep your eye out for any big surprises there. There are also some minor economic reports coming out tomorrow, but they are not heavy hitters. Wednesday, Thursday and Friday are going to be big days in terms of economic reports that have the potential to really move the markets. Keep your eye on the economic calender as well as earnings dates for particular stocks you might be trading/watching.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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A lot of indecision and divergences in the markets today. The S&P 500 (SPY) had an inside trading day, showing no directional movement on the daily chart. The Nasdaq (QQQQ) was relatively strong, closing up .5% while the other indexes sold off .5%-1%. Gold (GLD) pulled back slightly and the dollar (UUP) broke above resistance at the 200 day moving average. The VIX popped ever so slightly, up .5%. The TRIN was very bearish today while the TRIN/Q remained bullish.
Based on earnings alone (so far they have been good after hours), I would expect the markets to trade higher tomorrow. However, things can turn on a dime as it is earnings season. Also, we have Jobless Claims and Productivity & Costs numbers coming out pre-market tomorrow. Always check earnings dates for stocks you are watching and/or trading. It is not prudent to hold positions or trade into earnings. Also, it is important to always define your risk and trade with a stop loss.
Thanks for being a part of Swing-High.com!
Happy Trading,
Jason
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Today we saw a broad market rally, with all of the major indexes popping 1% or more. The TRIN, TRIN/Q, TICK, and TICK/Q all corroborated the bullish move quite nicely. The VIX only dropped about 2%, but it is well under 20 and we can’t ask for much more right now.
SPY is in a high base formation on the daily charts and appears to be setting up for a breakout to new 52-week highs. It would be very bullish for SPY to break out above 115 and make a run to the 120 area, also testing the upper trend line of the rising wedge formation on the daily chart. Do not jump in early though. Wait for a confirmed break out above 115 and a close above 115.50 on the conservative side. SPY is sitting at resistance at 115 right now and can just as easily turn around and head lower.
Look out for Housing Starts data as well as the Producer Price Index tomorrow as they can be market movers, perhaps even a catalyst for a breakout. Check your Bloomberg Economic Calender for more details on those two economic reports.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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Dear Traders,
I am sorry to announce that there will be no analysis tomorrow. I am taking two final exams and driving home. As for today, I will give a brief recap of the market action. Also, tomorrow marks the start of winter break for me and posts will become more sporadic. Sorry for any inconvenience this may cause. I plan to have the first installments for the education page ready in January 2010.
As for today, the broader market indexes showed some strength early in the session, despite mixed economic reports. However, the indexes proceeded to sell off for the rest of the day. We could see a small down leg here. The Russell 2000 (IWM) was the strongest of the five indexes I focus on. The financials (XLF) were the weakest. For the most part, I am not too worried at this point. The markets have not changed much since yesterday. What I mean is that things still look moderately bullish at this point, despite today’s setback.
The rest of the week has a lot of economic news coming out. All of this culminates on Friday with Quadruple Witching. Friday is a good day to sit out, especially if you are new to trading, or have not experienced a Quadruple Witching day before. They can be highly volatile and unpredictable, so be careful. If you have any doubts, sit it out. I still think the markets will continue to test the highs of 2009 to finish off the year. However, things can change quickly, so be nimble. Check the Bloomberg Economic Calender regularly and be prepared for potential market moving data.
Thanks in advance for understanding my schedule changes this month. Most importantly, thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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The markets are mixed today on the back of some mixed economic data. The Russell 2000 (IWM) is the winner so far today, up .5%. Meanwhile, the Financials (XLF) are the real loser, down over 1%. The Nasdaq (QQQQ), Dow Jones Industrial Average (DIA), and the S&P 500 (SPY) are flat to lower for the most part. Intraday, SPY tried to break out of its bull flag formation, but has failed. The TRIN and TRIN/Q continue to be divergent. The VIX is down ever so slightly. Gold (GLD) is down .33% and the dollar (UUP) is up .8%, so that should provide for some selling pressure in equities. If stocks hold up today, even if they close flat, that will be bullish.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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Stocks finished up for the most part today as the Bulls won out over the Bears. The Nasdaq (QQQQ) was the exception today as it closed down .4%. The S&P 500 (SPY) closed up .4%, the Dow Jones Industrial Average (DIA) popped .7%, the Financials (XLF) also popped .7%, and the Russell 2000 (IWM) finished up .94%. The TRIN was neutral for much of the day, while the TRIN/Q stayed bearish. The TICK and TICK/Q corroborated the moves in their respective indexes. The VIX dropped 3.27%.
The broader market indexes actually look bullish on the daily time frame. The Russell 2000 (RUT) is reaching the apex of its symmetrical triangle, so it is due for a breakout in either direction soon. The formation on the Russell 2000 could also be considered a bullish pennant because it formed at the top of a rally. The Nasdaq, S&P 500, and Dow Jones Industrial Average are all in high base formations. The Dow Jones Industrial Average is actually testing its highs and appears to be poised for a break out early next week. The Financials have pulled back harder than the other indexes, so the index is relatively weak, but if it breaks above its downward sloping trend line starting in the middle of October, that could be bullish.
I took four trades in the past two days. Two of them are high base breakouts, and the other two are plays on the stock’s bounce off of a lower trend line/support line. The stocks mentioned are Starbucks (SBUX), Big Five Sporting Goods Corporation (BGFV), NetFlix (NFLX), and HMS Holdings (HMSY).
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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Economic reports came out this morning and they were bullish for the most part. Stocks are pulling back right now based on technical moves. The S&P 500 (SPY) put in a small double top formation on the 15 minute chart. The Nasdaq (QQQQ) has been selling off all morning. The VIX is spiking although it is still lower. The TRINs are heading into bearish territory. Be careful going long here (or short for that matter). Keep in mind that we are still holding up in our longer term consolidation patterns on the broader market indexes.
I personally have taken 4 small trades in the past couple of days. I will talk about them in my Post Market Analysis or possibly my Weekend Review. Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
Happy Trading,
Jason
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The Nasdaq (QQQQ), S&P 500 (SPY), and Dow Jones Industrial Average (DIA) all made new highs for 2009 today. The Nasdaq finished up .52% today. The Dow Jones Industrial Average closed up .29%. The S&P finished the session .57% in the green. The Russell 2000 (IWM) and Financials (XLF) showed relative strength on the day, up 2.48% and 1.88% respectively. These two (normally) leading indexes seem to be working hard to catch up to the others on the daily chart. Gold (GLD) closed lower by 4.17%. The Dollar (UUP) moved higher by 1.5%, which is a huge daily move for a currency. It’s certainly strange to see gold sell off so hard and the dollar pop so much while stocks rise. Just goes to show you that the markets can do what ever they want, and just because we saw a strong correlation between certain asset classes for an extended period of time, it may not always be the case. The TICK spent most of the day in bearish territory on the pull back we saw in equities. The TRIN hovered around neutral to bullish. The VIX dropped nicely, down 5.39%.
I will review the broader time frames (daily, weekly, and monthly charts) in your Weekend Review. Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.
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