A Close Call for Rain

The 30-minute QQQ chart, complete with all the marquee issues which were weak this morning, is at a critical juncture this afternoon.

You can see major support (on this timeframe) being probed as we speak.

Weakness in the likes of Apple and Google is no doubt placing pressure on the ETF, while Amazon remains resilient of late.

Let’s see if the storm clouds bring the rain, or instead if the weather breaks and the bulls’ sun comes back shining through.

What are you trading into the final hour?

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If catching bloody, falling Russian knives is your thing Mechel Steel may finally be ripe to snap back. The beaten-down Russian steelmaker is sporting a daily chart upside reversal candlestick today.

I would definitely keep a stop-loss below today’s lows to mitigate downside risk, which could be considerable given the action in copper, the news, and emerging markets. Nonetheless, the contrarian play is there for at least a quick trade.

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Courtesy of The PPT algorithm, here are the most current top five readings from my “12631 RELATIVE STRENGTH” custom-made screen, identifying which stocks are exuding some of the best performances to the market at-large at any given moment.

I look for stocks whose Daily PPT Hybrid Score surges, while the Weekly Hybrid has been negative over the past week. This can often yield stocks which are emerging from consolidations.

Members can click here to view and save the screen.

Sorted for at least 500,000 shares of daily average volume to ensure liquidity.

Please click on image to enlarge.

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The most concerning aspect about today’s market price action is not necessarily the faded rally by the major averages this morning. Instead, liquid, momentum and marquee issues such as FB GOOG NFLX PCLN TSLA TWTR are all acting quite weak on a relative basis. In other words, we may be seeing more distribution by institutions even as the market appears to be trying to stem the tide of yesterday’s selling.

As I noted on my video market recap earlier this week, if we lost Wednesday’s lows on the major averages i was expecting a 50-day moving average. That remains the case, and I am positioned for it inside 12631.

Keep that Ford short on your radar, especially if it loses $15.

What are you trading this morning?

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I sold out of the remainder of my TVIX long this morning, into the opening move higher to $8.30. My entry, inside 12631, was initially started at $7.19 and I averaged into it.

As much as I would like to hold over the weekend, playing for a huge volatility spike next week, the fact of the matter is that these volatility ETF’s, as much as anything else, as short-term trading vehicles where you should not let yourself be lulled into the buy-and-hold fantasy (for them).

Elsewhere, the market bounce looks rather tepid so far. Metals and miners are strong again, but have cooled off since their openings pops.

I will need to decide by the end of today whether to hold my bond short over the weekend, given the resurgence of TLT this week.

http://www.youtube.com/watch?v=kG6ydLYG4uY

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Thursday’s strength in the Yen (ETF second chart below, daily timeframe) no doubt is not helping the cause for equity bulls, here or in Japan.

On the first chart, below, you can see the weekly for the Japan country ETF. Note the triangle breakdown, retest up to it, and now threat of a rollover. EWV is the ultrashort ETF.

Also keep an eye on Ford under $15 as a short idea.

On the long side, AG EXK are two silver miners I am watching on strength.

Which stocks are at the top of your watchlists this morning?

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