World markets are mostly red overnight with Europe down almost a
percent and Asia got hit pretty hard. Shanghai is down 0.67% but
(INDEXNIKKEI:NI225) is having another bout of extreme weakness,
down 4% as the yen hit six-week highs.
(INDEXSP:.INX) futures are down 5-7 handles giving some downside
follow-through to yesterday's break of the 1698-1702 actionable
pivot. Yesterday did give some reasons to take off some risk for
the intermediate-term active market participant. If you were
looking for cues to get short, yesterday could have provided a
small inflection point. It seems like IBD tweaked its big picture
section as they went to "rally under pressure" a bit quicker than
in the past.
In order for the bears to keep some control, they can't let the
bulls reclaim the 1698-1702 area. Support stands at the 21-day
around 1682ish and then 1671 is a bigger spot. We will measure the
next few sessions to see what type action we could see in August.
Nobody "truly" knows, but if you made adjustments around that
pivot, you have some flexibility. I don't think the highs of the
year are in, but some volatility will be nice.
There has been lots of nice stock action as this earnings season
has provided us with multiple set-ups for action.
Today we will go over some stocks that showed some relative
) had a big gap down on July 18 after the company missed its
earnings estimate, then dip buyers stepped in at the $51 area to
contain the sell-off. The stock built a base at this level for a
few sessions before seeing a spirited move yesterday that brought
it back above all key moving averages. The stock showed some
relative strength yesterday. It could try to fill the earnings gap
at above $53.92.
) spiked higher at the open yesterday after the luxury retailer
posted earnings that nearly doubled. It sold off together with the
broader market in the morning, but met some buyers at the upper
level support of $67.85 and saw a strong rally off of lows. Holding
above prior pivot high of $69.23 would be constructive for higher
prices moving forward.
) absorbed debit card fees limit news that created a wide trading
range in both Mastercard and
) last Wednesday. Yesterday MA tacked on another 1.80% after
flagging at highs for two sessions. It looks a bit extended on the
daily chart now and hard to chase, but its relative strength is
something to notice. Some work above $640 to allow the key moving
averages to play some catch up would be healthy for higher prices.
) is a new issue that has a constructive-looking chart. It saw a
nice break out at the $70 level on Friday after grinding higher for
almost two months. It's now flagging nicely at highs showing
healthy digestion of the potent break-out. The stock also showed
some relative strength yesterday. We now have an upper support of
$72.19 to trade against.
We're seeing some mixed action in tech.
(AAPL) had a small "Red Dog Reversal" at $470.67 yesterday as we
talked about how it did look a bit extended from the short-term
moving averages. It still looks good as it's trying to build a base
at the $462 area. Next bigger support / buyable spot is $457ish.
(NFLX) held up well yesterday as it did sell off with the market in
the morning, but held the recent pivot level of $250 and bounced.
The stock closed well off of lows and posted 0.81% of gains showing
relative strength. Look for potential upside follow-through above
$257.60 if the market continues to hold.
(AMZN) is hovering around its 21-day MA and put in a long bottoming
tail after it held the upper support of $297 yesterday. A move
through $302-303 could help it penetrate through the short-term
downtrend since July 26.
(GOOG) was on our radar yesterday for a move through $907. It tried
and failed and is a bit sloppy. I'm going to stay away until it
starts acting better. Holding above $880 would be constructive, but
a break below that level could add some pressure.
(BIDU) has been acting better since early July and further
re-energized after earnings. It has some support around $130ish
with a major gap support around $120ish.
(FB) has been super strong since earnings and could use a break.
Yesterday's low of $37.94 is a point of reference. The 8-day stands
(LNKD) is building a nice flag above its earnings gap, with $228ish
being the level to trade against. A move above $235ish could set it
(VMW) is building a nice pattern above its earnings gap. The
$83.50ish pivot is the level for action if it can power through it.
(FSLR) came out with very weak earnings last night and is getting
beat up. The $40ish pivot is some bigger support to watch.
(TSLA) has been a great stock on all time frames. Earnings are
after the close. It is priced for perfection so I'm going to wait
until after the number to trade it.. I'm probably not doing an
option strategy here like I did into earnings with GOOG, AAPL, FB,
and LNKD. Historic highs for after hours is $146.
Bears have the ball a bit here, but if we close back above
1698-1702 it will be a very quick set of downs.