Good evening StockBandits!
The indexes each sat in positive territory early in today’s session, but none maintain their gains. Instead, the intraday charts showed stocks in retreat mode with the early strength being sold, a rest phase, then more weakness. The averages finished the day not far from their lows, which isn’t something we’ve seen much of lately.
AAPL was the story stock last night, and it was treated well today with a 5% advance. More on that chart momentarily, but despite the big pop in the tech heavyweight, the NAZ only managed to finish fractionally higher for the day. That keeps the lateral price action going for now, although another big tech name (FB) is running higher in the after hours and that could deliver another positive start to the NAZ tomorrow morning.
Elsewhere, we did see a bit of a pullback begin, but still nothing of much significance. The RUT was off just shy of 1% and the S&P 500 fell back below the 1687 high from May, which gives those indexes a shot at some continued profit-taking in the days ahead. Overall though, the market has maintained the vast majority of its recent gains, keeping the bulls in the driver’s seat for the intermediate term.
Let’s get to the charts.
NAZ – The NAZ squeaked out a tiny gain today despite the best performance from AAPL of 2013. This index is still churning here just beneath the recent highs, creating a large bull flag pattern. Should this get resolved lower, it would negate the setup, but if it is resolved with a breakout to new highs it could mean a quick return of momentum for this index. The most nagging issue is that of the other indexes which in many cases are looking fatigued.
SP500 – The S&P slipped back below the May high today, making the past several days now a failed breakout. That doesn’t spell doom for this index, but it is a sign of some indifference here after such a big run. More rest would be best given this price action.
RUT – The RUT gave up some ground today, although it wasn’t necessarily a bad day for the small caps. They’re still just 1 day removed from their all-time highs, so it’s something to keep in perspective. Should we get any follow through selling, the unfilled gap begins at 1027 and goes down to 1020.
DJIA – The DJIA is back testing its breakout zone level as of tonight’s close, looking quite a bit like the S&P after a feeble breakout attempt through the May high of 15542. This index also acts like it could stand to rest a bit more before making another attempt higher, but we’ll see.
Notable Names:
LEN was highlighted last night here as a new swing candidate, but tonight has been removed. It did not trigger a trade entry, as price never cleared $35.60 at the trend line. Instead, it turned lower and took out multi-day support, negating this pattern for now so I’m going to leave it alone.
RVBD tried to make some headway today into the gap but the intraday market weakness likely prevented better progress. It still looks good, so I’ll set it up for a momentum play once more for Thursday above $17.55. Earnings are due out next week so this is not a swing candidate for me.
INFI has pulled back quietly the past couple of days and created a small trend line which could be used as a pivot for a turn back up. I like this setup for a momentum play above $19.80 for Thursday.
SFUN would typically be below my volume thresholds but with lots of recent momentum we’ve also seen much heavier volume with ample liquidity on the days this stock has been moving. This bull flag looks good for a possible turn higher, so I like it for a momentum play above $32 where the upper trend line of the flag currently sits.
CME is now looking heavy after resolving its wedge lower and then resting on multi-day support. A break below $73 sets up a momentum play for Thursday with a bit more room to retrace some of the rally.
New Swing Trade Candidates:
These stocks look ready for imminent multi-day moves. Pattern confirmation occurs with a move through the entry level. Initial stop and target levels are also provided.
P is still the same setup I’ve been watching since Monday night when I listed it here, but my parameters have changed slightly so I’m relisting it. I’ll now use $18.35 as a buy point for a swing with a stop beneath today’s low. I would expect this wedge to get resolved one way or another before the end of this week, although I’m only interested in trading the long side if the upper trend line is cleared.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
