Futures are basically flat Monday morning after another
impressive move in the stock market last week. The
(INDEXSP:.INX) cleared 1600 with some authority Friday as the jobs
data came in better than expected. Many are saying, what do we do
now? It's the same question that people have asked as we've climbed
and reached milestones over the course of the last several months.
So far, the markets have been able to clear multiple pivot areas in
2013 without much pushback. Each pullback has also been supported
by the 50-day moving average. So the answer to that question has
been, "a lot of the same." They say the trend is your friend, until
it isn't. You can approach each level/phase with less size and
fewer positions, but those fighting the trend are dealing with a
large amount of frustration.
On a micro level, use the gap from Friday as your pivot to trade
against. Some digestion would make sense as we are very extended
from the 8- and 21-day moving averages again. The gap starts at
$161.04. We can measure how strong this area is by how this gap
gets treated. If we hold above for a few sessions, then there's no
reason why we can't see a move to $164ish in May. If we fill the
gap quick, then the speed could slow down and we could be in a more
choppy environment for the Summer.
Tech continues to be filled with opportunity.
) is best of breed in high beta tech and reached a new historic
high Friday. This stock has been acting well since last year. Even
in 2013 it gave a few new entries, the last one as it broke its
descending channel after earnings around $803ish. Now it's trim and
) since earnings has provided a few tradable setups. From $420 up
to $453 was very tradable, for example. At this point I don't see a
clear setup. The target was raised by Barclays and it does have
room to fill a gap up to $460 then the recent pivot high was
) has been a great mover this year. It's been in this upper very
tight range since earnings. The 8-day has caught up so something
could happen soon this week. Some are looking to short below
$209.50 and some are looking to buy above $218-220. I will be
watching this closely.
) broke below its 200-day for a day, so my 1- to 3-session rule
worked pretty well there. It has some room to $260-263 but is very
) is a nice example on why I don't take stock into earnings
reports, or I suggest reducing before. Lots of earnings risk in all
names. This one at least gave you the trade to $200 before the
numbers so it gave you additional reasons not to take it as the
move happened before the report. At some point it could be buyable
again. Use $173.72 as a pivot to trade for action, then bigger
support at $165.
(FB) tried to make a move after earnings as the narrative focused
on solid growth in mobile ad revenue. It did act well on Thursday,
but was weaker on Friday as
continues to bash it. I guess they have some leaks over there, as
it seems like it goes down before these type of stories. I will
look to see it it's buyable into the $27.50-28 area. If this
doesn't hold it will probably go back to the same choppy trade.
(INTC) was upgraded and has been acting well since clearing our $22
pivot-it still looks good.
(MSFT) has been a great vehicle on an active and medium-term time
frame. I think $37-38 could happen this year.
Banks have been a bit lethargic.
(GS) -- you could trade this vs. $145ish but it needs to clear $148
with some authority for better action.
(MS) has been acting a bit better. You could trade it vs. $22.67.
Bank of America
(BAC) has been a bit lethargic. It needs to clear $12.50-12.55 to
(WMT) acts well and could see another move above $79.50 but be
(TGT) continues to trend, the pivot here is $71.
(TJX) is a great acting stock and closed at highs. I'd trim and
(BA) tacked on another new high Friday, and has been a great 2013
vehicle. Trim and trail.
(REGN) from was a rock star last week. Congrats if you were there.
(JAZZ) has been sloppy but could act better above $61.
(ALXN) has had many false starts, but keep $101 as an action spot
if it gets big volume.
(KERX) is a little one that has been constructive. The next pivot
(CELG) bounced well of its 50day but needs time.
Metals have an inside range right here.
Gold (NYSEARCA:GLD) on a macro level is a bit broken, but
short-term if it can get a move above $143-143.50 it could see a
move to re-test $148ish. Just be careful.
Inverse 20+-Year Bond ETF
(NYSEARCA:TBT) finally had a gap and go that stuck. See if it can
hold its gap of $60.19.
At this point I don't have much going on. I'm not fighting the
trend but sold most of my longs into Friday's gap up. I will
tactically trade the next few sessions. If we hold this level well,
I might put back on a limited portfolio approach.