Category: Technical Analysis
Pre-market update (updated 8:00am eastern):
- European markets are trading +0.8% higher.
- Asian markets traded over -1.0% lower.
- US futures are mixed due to weak AAPL earnings, but S&P trading higher.
Economic reports due out (all times are eastern): MBA Purchase Applications (7am), New Home Sales (10am), EIA Petroleum Report (10:30am)
Technical Outlook (SPX):
- SPX sold off for the third straight day and closed below the recent uptrend off of the June lows.
- Double top-formation coming together on SPX that could pose as trouble in the days ahead if confirmed with a close below 1334.
- Volume continues to trickle higher, which is concerning for the bulls, as it shows escalating fear building in the markets.
- Approaching short-term overbought, but intermediate and longer-term is no-where near such a reading.
- Bulls must hold 1325. A close below that level, and you have what would begin a new downtrend.
- On 7/18 we managed to break through the descending trend-line off of the 4/2 highs (see chart below).
- But not this is starting to look like an incredible ‘head-fake’.
- Watch the SPRI that I posted this past Sunday and how it shows us near-ready for the reversal signal.
- Also note the price resistance the SPX is up against on the weekly chart.
- The VIX pushed above 20, which typically shows mounting bearishness for the markets.
- 30-minute chart shows a nice channel uptrend being threatened by today’s early morning action.
My Opinions & Trades:
- Covered FB yesterday at $28.29 from $28.94 for a 2.3% gain.
- Sold MDT at 37.49 from 38.47 for a -2.6% loss.
- Sold AUTH at $5.19 from $5.02 for a 3.4% gain.
- Added GS yesterday as noted below. .
Apple: Using Technical Analysis to Time Your Entry
This is one my favorite trade setups. It involves three components: (1) priceline shift to either sup/res ( 2) price failure of centerline (3) diagonal breakout potential through a wedge. Click Read More to see how this trade setup turns out.
This Trade Setup is a textbook example of a price from the left side of the chart holding as support, and then getting a combination of a horizontal and diagonal breakout combination. The trade can be said to be through a right side triple breakout (two blue squares), and has breakout potential to the green line (this is due to the fact that there is no price in between the breakout area and the swing low that is likely to act as support).
Continue Reading to see the result
The E-Mini S&P 500 (ESU2) dropped hard on disappointing jobs numbers.
The forecasts for the US Unemployment report were +90,000 to +125,000.
Yesterday, the US Initial Jobless Claims decreased 14,000 to a seasonally adjusted 374,000. The number of extended benefits decreased 12,113 to 47,425 as of June 16th…
Anxiety has gripped Wall Street this morning, as fears of a global economic slowdown continue to weigh on markets. As investors prepare to size up the state of the labor market, futures on the Dow Jones Industrial Average (DJI) have fallen below breakeven.
Pre-market upadate (updated 9:00am eastern):
- European markets are -0.8% lower.
- Asian markets traded -0.4% lower.
- US Markets are nearly 1% lower ahead of the opening bell.
Economic reports due out (all times are eastern): Employment Situation (8:30am), EIA Natural Gas Report (10:30am)
Technical Outlook (SPX):
- Yesterday’s pullback was light, and without any sense of panic to it.
- Today’s market is trading lower off of a disappointing payroll number.
- There is plenty of ‘wiggle-room’ without causing much damage on the charts
- As long as 1327 is held the existing upward trend-line remains in-tact.
- Some weakness here is not surprising, considering the extent of which the market has moved over the past six trading days (on average more than 10 points per day).
- If today’s weakness holds, the SPX should come off of the overbought levels that it has been experiencing.
- Gap downs in the market, like we are seeing today, are often hard to maintain, and usually attracts dip-buyers. Be very cautious and don’t get overly excited about the early morning action in the markets.
- This isn’t the time to add new short positions – you do that on bounces.
- Breaking through the 1390′s will be difficult as there are plenty of separate resistance levels in that area.
- Safe to assume that volume will be light this week as it was on Monday and Tuesday, as many traders/investors will take the remainder of the week off.
- Volume in general continues to be relatively light during the past month of trading.
- SPX has now made new highs on the uptrend that began on 6/4.
- 30-minute chart continues to highlight the need for a pullback in the short-term.
- Below 1306-1308 price level, will nullify the current rally off of the 6/4 lows.
- Would represent a ‘lower-low’ in the market.
- VIX dropping hard and is now below 18.
My Opinions & Trades:
- Good chance that today’s weakness may take me out of 1-2 long positions.
- Will look to add new long positions on the early morning weakness.
- Closed out NFLX yesterday at 77.68 from $70.00 for a 11% gain.
- Covered WLT at $47.05 from $45.81 for a -2.7% loss.
- Bought WBC at $53.98 yesterday.
- Bought on Tuesday .
- May add an additional 1-2 positions, as well as close out any non-performers.
- If UA continues to struggle, it will be a prime candidate for me to scrap.
- I don’t see really any strong evidence to be short “right-now”. Don’t short the market right now expecting the market to come to its senses. It could be a long painful wait.
- Speaking from experience.
- Still long WNR at $20.51, CMG at 378.44, UA at $93.09, HD at $51.50 .
- Increasing my stop-loss in WNR to $22.70 locking in 10.7% in gains and providing plenty of wiggle-room for the stock.
Actions taken by central banks in China and Europe are sending U.S. stock futures higher.
See on www.financeroom.net
Pre-market Update (Updated 9:00am eastern):
- US futures are moderately lower ahead of the open.
- European markets are trading -1.1% lower.
- Economic Reports Due out (Times are EST): GDP (8:30am), Jobless Claims (8:30am), Corporate Profits (8:30am), EIA Natural Gas Report (10:30am), Kansas City Fed Manufacturing Index (11am), Farm Prices (3pm)