Good evening StockBandits!
The week’s most-anticipated event was today with the FOMC, and it didn’t disappoint in delivering some fireworks to the market. Stocks were soft ahead of the announcement but not down much. Once the statement was read, we spiked lower, then recovered enough to mark new session highs. However, from there things turned ugly and we got the sell-the-news reaction I discussed here last night.
In the end, the indexes gave up more than 1% each to quickly give up the June highs they had achieved yesterday. This puts the averages back in the lower portions of their respective trading ranges, although they still have some breathing room on the downside before key support would be threatened (which I’ll cover on the charts).
Last night, I set up a handful of new potential plays including both longs and shorts. Today I got triggered into just one, which was a short in FSLR. I was also able to book some gains on SCCO, the existing short position from last week. I’m staying light and will continue to add setups as I find them, but won’t force anything. We’re in a range-bound market and I may actually begin adding some reversal plays as a result to possibly get long against support and/or short against resistance levels when appropriate.
One other note is that tomorrow I will not have the weekly Charts on Demand video due to some travel I’ll be doing. If a swing update is warranted, I’ll do one, but otherwise the next update here will arrive on Sunday.
Let’s get to the charts.
NAZ – The NAZ slipped back under the 3484 level it had pushed past on Tuesday, keeping the hopes for an upside trading range resolution muted for now. Volume picked up, as expected, which isn’t a good thing technically when paired with today’s decline and finish at the low. However, the range is still intact and we’re still waiting for meaningful follow through. Expect more reversals until we leave this channel.
SP500 – The S&P gave up 1648 just a day after clearing it (blue dashed line) with a hefty 1.39% decline today. The battle continues and so will the reversals until one side gives up.
RUT – The RUT had lifted right off support at 970 last week to over 1000 yesterday, but today gave back half that move in a single session. This index continues to chop around like the others, and key support is the next level to watch should we happen to see more selling. At some point, we will exit the range, it’s just a matter of time.
DJIA – The DJIA had cleared 15300 yesterday but gave it back today as it surrendered half the gains off the last bounce from support. It still has a little breathing room, although another day like today and it’ll be facing key support once more.
Notable Names:
AAPL is still working toward the $419 level shown here multiple times in recent weeks. A failure to hold that level would leave $385 as next support. The last bounce created a lower high (note the descending trend line above current prices) and every single advance has been followed by an immediate decline in recent weeks. This is not the look of strength or recovery yet.
FB is still validating the $25 level just as it has since late December. Today the stock bounced back to that area, pushed slightly past it, then gave it up. This stock is bearish beneath that level and bullish above, so it remains the level to trade against.
CSIQ is looking bullish as it has consolidated its recent gains and has not given up hardly any ground since the highs of a few weeks ago. This ascending triangle pattern could stand to tighten further though, so I’m leaving this one on watch until price pressures upper resistance or this pattern gets negated with a downside resolution.
SCTY is acting heavy here as bounces in recent days have each been feeble. Price is now hugging multi-day rising support, and a break below the $35 area could send it tumbling once again. The difficulty is that it’s not optionable and is hard to borrow for shorting. At any rate, it offers a good look at how momentum stocks can change directions and this one looks vulnerable to further retracement after the May double it saw.
CAB is trying to turn higher here but needs to clear the descending trend line to make some progress. I like it for a momentum play above the $69.70 level, although a swing stop is just too far away for now.
NUS is starting to falter at resistance and if it breaks rising support, it looks good for a quick short sale.
SSYS is in the recent habit of creating lower highs and may be carving out another one here. A break below rising support at $83.60 looks good for a momentum short, but given the volatility of the past few weeks in this stock I’m not willing to take it for a swing just yet.
NAV is turning lower after a multi-day pause and now faces multi-week support. A break below $29.70 and this one is free to move lower, so I like it for a momentum short sale beneath that level. A swing stop would go at the $31.50 area, which is more than 6% away and simply farther than I’m willing to give it, so I’m only interested in the initial break of this level and not an overnight or multi-day trade.
New Swing Trade Candidates:
No new swing candidates tonight, sticking with existing positions and potential trades already on the grid.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
