The FOMC Minutes moved the markets higher today. Today was a fairly common Fed announcement day as the markets chopped sideways on low volume until 2:15, at which time volume, volatility, and in this case prices picked up into the close. If you caught yesterday’s Post Market Analysis, I warned everyone to look out for this announcement.
The S&P 500 (SPY) is still consolidating in a low base formation, trading under 110 and above 109 for the most part today (with the exception of the brief run down to 108.3 around 2:15). The TICK, TICK/Q, TRIN, and TRIN/Q corroborated today’s action nicely. Keep in mind that the TICK/Q and TRIN/Q correspond with the Nasdaq. I forgot to mention the VIX in my video, but it dropped 5.75% today, holding up above 23. The Financials (XLF) and Russell 2000 (IWM) were clearly the strongest of the five major sectors I cover on this site. That is certainly bullish, but on the daily charts, things still look pretty weak across the board. If SPY does put in a swing low here, I expect a lower swing high around 112 or 111. If SPY consolidates here and breaks down past 108, the next support areas are 105 and 103.7.
I want to briefly mention AAPL here. It looked like AAPL was going to have a classic “buy on the rumor, sell on the news” type day today with the release of the iPad (terrible name by the way). However, it rallied back and closed higher for the session. Right not it is not showing a buy signal on the daily chart. I would like to see it continue to consolidate here, putting in a high base or ascending triangle. From there, a break above 115.55 on convincing volume would be a buy. If not, playing a pull back buy could be an option in the future.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately, especially on days like today and as volatility is increasing.
Happy Trading,
Jason
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Big sell off across the board today. The S&P 500 (SPY) broke down out of its rising wedge formation on the daily chart. The high base was shattered today, so a high base breakout is no longer a possibility. The break down occurred on very high volume which is significant in confirming the rising wedge break down. The VIX popped 20% today, closing over 22! A lot of fear is coming in to the markets at this point. The TRIN was very bearish while the TRIN/Q was oddly bullish. The TICK and TICK/Q were both bearish today.
Be very careful going long in this environment. I am personally going to wait for the next swing low before considering taking up any more long positions. Always compare stocks you are watching to the indexes to identify relative strength or weakness. Going short would be a better bet right now, but it is tough to say how far the sell off will go. Expect major support for SPY at the 108-110 area.
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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We have a mixture of bullish and bearish signals today. SPY broke down out of the rising wedge formation on the daily chart. However, SPY also held up in the high base formation on the daily chart. Volume was relatively strong today, so on a sell off, that is an ominous sign. The VIX popped up over 6%, but closed well off of its highs and well under 20. The TICK and TRIN both corroborated today’s action well.
Check your Bloomberg Economic Calender for reports that could potentially move the markets tomorrow. Also, check out Chart Game if you get the chance. It’s a fantastic practice tool. 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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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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We certainly saw a sell off today on some convincing volume. However, on broader time frames, the trend is still bullish. I am not ready to count the bulls out.
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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Yesterday I drew attention to the fact that the markets showed strength into the close and I predicted that we would see a bounce today. I was right.
Now that I have that out of the way, let’s look at the markets. Our leading indexes (Nasdaq, Financials, and Russell 2000) were the strongest today which is nice to see. The market internals showed some weakness early in the session, but turned around and spent most of the day in bullish territory. Gold (GLD) climbed almost a full percent today, and the Dollar (UUP) fell slightly.
The daily chart of SPY looked like it was pulling back yesterday, but today’s action completely stopped the down leg. Do not count the bulls out. The markets still want to go a little higher. There is major resistance coming up around 120 on SPY. I would not be surprised if we reach that point and begin to turn around. We will see what happens.
Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately. Capital preservation comes before profits… ALWAYS.
Happy Trading,
Jason
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Not much happened between my Halftime Report and now. I honestly felt like I had nothing to say in this video. Stocks did finish higher, but for the most part, they did not move much between noon and now. Please refer to my Halftime Report today for more detailed analysis.
We have eleven trading days left for 2009 (four more this week, 3.5 next week, and 3.5 the week after). Things are looking pretty bullish to close out the year. Some of the bullish action can be attributed to fund managers loading up on stocks to look better. Clients will want to see their funds invested after hearing so much good news… January 2010 will be an interesting month. My guess right now is that we will remain strong for 2009 and some, if not all, of January 2010. After that, I would not be surprised if the markets start a strong pull back. That’s just a guess, and I honestly do not care either way. As I have said before, I am a trader. I can theoretically make money in any market (bull or bear).
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 are higher today with very little economic news, if any, to support the move. Citigroup is repaying its TARP funds. The stock (C) is down over 5% so far on the day. Exxon Mobile (XOM) is buying XTO Energy (XTO) for $31 billion. XTO is up about 15% today while XOM is down over 4%. Takeovers usually work out that way. The company that is purchasing usually experiences a drop in its stock price and the company being bought usually sees its stock gap up or pop. Also, Dubai is receiving $10 billion from Abu Dhabi to cover debt. If any of these headlines is helping push stocks higher today, it’s the Dubai bailout.
The Nasdaq (QQQQ) and Russell 2000 (IWM) are leading the markets higher today with the S&P 500 (SPY) trailing close behind. The Financials (XLF) and Dow Jones Industrial Average (DIA) are the weakest indexes so far today. The market internals are corroborating the move higher with the exception of the TRIN. The TRIN is actually giving a bearish sentiment read, while the TRIN/Q is bullish. Recently, these two indicators have been divergent; normally they correlate positively and give similar readings. The VIX is bleeding out nicely, which is bullish for stocks.
At the end of my video I cover four trades that I took last week as well as one that I missed. Starbucks (SBUX), NetFlix (NFLX), Big Five Sporting Goods Corporation (BGFV), and HMS Holdings (HMSY) are the trades I took. Wimm-Bill-Dann Foods OJSC (WBD) is the trade that I missed. The trades include: High Base Formations and High Base Breakouts, Ascending Triangle Formations and Ascending Triangle Breakouts, Bullish Pennant Formations and Bullish Pennant Breakouts, as well as Pull Back Buys/Pull Back to Support/Bull Pull Back/Bounce off of Support plays.
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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