After yesterday’s powerful broad market rally, we are seeing some of that now-familiar mild consolidation on the indices this morning. Despite a weak jobs report and a warning from Intel, the underlying health of the market remains impressive with plenty of stocks in the green and/or working through tight, technical bases. In addition, the small caps housed in the Russell 2000 Index continue to lead the charge higher, frustrating a great many bears looking for an imminent rollover or some type of glaring cracks in the sidewalk.

I will be inside the 12631 Trading Room focusing on managing my winning long trades and scouting out the next batch of breakouts that appear to be firming up here. If you got caught leaning short or flat-flooted in all cash during this rally, come check us out inside 12631. We methodically increased long exposure as the market improved, and are always on watch for a change in character in the market. Indeed, complacency is the enemy of the disciplined trader. However, confidence and execution are crucial to success.

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This is the money time for me and @RaginCajun inside 12631, with plenty of stocks moving higher. So, I am going to get to the point. Updating yesterday’s 30-minute descending triangle that I pointed out on the SPY, you can see below that a high volume upside breakout won out. We are flagging high and tight so far, but a bit of a retrace would not surprise me either.

As has been the case for a while now, focusing on the proliferation of individual issues beneath the surface should be as important as any other factor in determining your market posture.

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With promising action underneath the surface, we were making plenty of moves inside the 12631 state of the art chat room (referred to as the “Pelican Room”) today. To be sure, there are probably more reasons than I could list here to be cautious or outright bearish on the market, in terms of seasonality, macro figures, looming monetary and fiscal events, etc.. And yet, none of those reasons amount to much when we see more and more stocks acting constructively and making valiant attempts at strong breakouts.

There are never any guarantees in the market, but if you are a swing trader then there is no substitute for blocking out emotions and extraneous noise and focusing on what the market is actually doing. Over the past few years, we have developed 12631 to accomplish just that, creating a highly conducive atmosphere for traders.

Let’s see if the bulls can keep being the comeback kids.

More on my video market recap after the bell.

http://www.youtube.com/watch?v=aOvyymFaFs4

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Here is a 12631 blog post I wrote for members back on August 7th. This is the type of analysis members regularly receive on top of many other features we offer, including our unparalleled chat room. For more details about joining 12631, please click on the 12631 hyperlink. 

Also, LL continues to look great. Note that the chart below was from the original post. The float is loaded with shorts to squeeze further. 

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Part of your 12631 membership includes continued education about The PPT algorithm and its inner workings. There are so many ways to use The PPT as a valuable tool that it is best broken down into manageable segments.

As an example, inside The PPT if you click on “PPT TOOLS” and then “ALL INDUSTRIES,” you can then sort every industry in The PPT universe by daily hybrid (fundaments + technicals) change (Hyb. Chg. Daily). Today, you can see by clicking here that “Home Improvement Stores” is the top ranked industry in the entire algorithm with respect to its change in daily PPT hybrid score.

You can then click on the actual industry, which will list its individual stock components. I did just that with “Home Improvement Stores” and came across the gem below in LL. While the broad market is not quite all there for me to be very aggressive yet, this is definitely a stock to watch going forward.

So, as you can see, there many ways to use The PPT to find actionable trading ideas.

 

 

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One of my long portfolio holdings inside 12631, AOL, is up over 4% pre-market this morning. The first issue is seeing whether the move sticks and can build on itself to the upside. Beyond that, I wrote a post for 12631 members last week discussing how I view pullbacks within uptrends. As has been a recurring theme of my posts and videos for weeks now, the emphasis should be on the “how” of the consolidation. Here, AOL saw a fairly orderly giveback down to its rising 20 day moving average, with selling volume abating.

We know AOL remains in a strong uptrend. However, a touch of the rising 20 day moving average is not an automatic buy signal–It is simply an important reference area to observe if, in fact, buyers step up. As you can see below, not factoring in this morning’s gap higher, the buyers eventually came in to support the general area of the 20 day moving average.

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To update this post from earlier in August regarding the bullish setups in the communications and cable service provider space, I continue to be intrigued by an array of names in the sector. 12631 members know from my current portfolio holdings which specific ones I like, but there can be no denying that Comcast looks ripe to bounce off that 20 day moving average after the uptick in buy volume on Friday. As with many stocks and sectors, the pullback over the past week or two has been orderly and expected within the context of an uptrend.

With that in mind, in the mass media space CBS also is indicating a tight base over the past few weeks that gave signs on Friday of attempting a breakout higher.

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