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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Interesting day in the markets as most major indexes were up about .5% mid-day, but all of them pulled back and finished in the red. The Financials (XLF) and Russell 2000 (IWM) were relative weak today. The VIX dropped about 3.5%. The TRIN, TICK, and TICK/Q all corroborated today’s action pretty well. However, the TRIN/Q stayed bullish all day. SPY is still in the process of consolidating at these levels. I would like to see a low base or a lower swing high going forward to support the bear case.
The FOMC meeting at 2:15 will probably be the highlight of the trading day tomorrow. Also watch the New Home Sales and EIA Petroleum Status 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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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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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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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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