The suspense builds, with the huge spreads now between names like CREE P SPLK VECO WDAY YELP getting sold hard, among others, versus the stubborn mega caps in the Dow, S&P, staples, and utilities.
I am still looking for the strong to succumb and the weak to stay weak. But it sure is a tough battle…
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Berkshire and Wells are two of the top three components in the XLF, sector ETF for the financials.
With many banks weak today on the back of the Bank of America news, I am looking for these two holdouts to crack in order for my financial sector short to start working well.
What are you trading this morning?
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The major averages are rallying this morning, with the mega caps in the Dow Jones Industrial Average once again out in front.
Still, leading issues like AMZN GOOG NFLX PCLN, among others, are noticeably red. This could easily be a sign of a market still under distribution, or heavy selling buy institutions, being covered up by the strength on the indices.
Thus, I am still operating under the theory the market is in a corrective phase with risks to the downside, where great defense is the name of the game.
On the 30-minute chart for the small cap ETF, watch price testing the declining 20-period moving average (orange line) for the first time since Thursday. Rejection here would open up a short entry.
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The following is just a small excerpt from my latest Weekly Strategy Session (please click on that hyperlink for details about trying it out). which I published for members and 12631 subscribers this past Sunday.
On the soft commodities front, sugar and wheat are looking to be the most actionable on the long side headed into this week. On their daily chart ETN’s, note the narrowing consolidations. On further strength, they can be deemed quality long entries.
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Comments »The following is just a small excerpt from my latest Weekly Strategy Session (please click on that hyperlink for details about trying it out). which I published for members and 12631 subscribers this past Sunday.
Gold, silver, and the precious metals miners lived to fight another week due to their failure to breakdown.
On the gold ETF daily chart, note the $122.50 prior breakout level (from the highlighted and still-confrmed inverse head and shoulders bottom) remained intact despite some wild price swings last week. The failure to break lower, followed by a sharp reversal higher can be seen as a potential bear trap, particularly with further upside this week.
Continue to key off the $122.50 level.
Silver also held major support last week, at the bottom of the highlighted descending triangle, even when it looked ripe to gap below it at one point. Bulls are looking to see a push over $19 now on the ETF to further the notion of a bear trap sprung.
The gold miner ETF is still…
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On any further weakness, I am looking for strong bank holdout Wells Fargo to follow the weaker banks lower. The first daily chart, below, shows the resilience but at the same time also displays the churning price action of late. I expect resolution to be lower.
I am also looking at Royal Caribbean as a short setup, especially with the weak consumer discretionary action for a while now.
Drop me your top tickers overnight.
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