Monday, September 20, 2010

After Close Pondering

Well the market certainly kept its winning ways today, albeit on weak volume. However thats comparing it to Fridays elevated levels due to quadruple witching. The Nasdaq has now rallied 9 straight days with AAPL hitting fresh all time highs today.

The energy sector put in a strong performance today. Lets see if the OIH can pierce its 200 day MA near 114.50. If it does certainly bodes well for stocks in the group. Buy stop on XEC can be placed @70.50 as it nudges its way past the 50 day line. APA looks to conquer its 200 day, as it approaches it for the fourth time since May. Place a buy stop on APA @98.25. Remember too that a buy stop on NBL can be placed @78.63 as it takes out a cup with handle pattern. A laggard in the group is EOG. Is that company's stock predicting a onshore drilling disaster? Wow is that an ugly chart.

Other spots where orders can be placed are: TEN @29.84 with a cup formation. The stock can also form a handle. ADSK @35.28 also a cup formation. A handle may develop here as well. JWN is going to test its 200 day soon. Place a buy stop on JWN @37.25. NSC has a double bottom with a handle buy point @59.74. DRI buy stop is 46.29 with a double bottom with handle pattern as well. Careful DRI has earnings tomorrow. TRMB broke out today above its 33.66 buy point. Keep an eye on it and also IPI which we spoke of yesterday had a beautiful day.

Yesterday we spoke of the value of looking at 200 day support. Today notice the viability of gap ups and how they generally hold up well. Case in point, CTXS INFA INTU CRM IBN AAP. Stocks gapping up then resuming their uptrends after finding support at the 50 day MA include RVBD CTSH.

Today was a nice day. NZ received a buyout offer from IBM. We sold it today @28 after purchasing it @19 on 8/31/10. Can a bidding war ensue? Perhaps, but we wont be greedy. We initiated a new position in WLL @94 today that we mentioned Saturday. On a down note we were stopped for a small loss in STRI today.

The author owns FCX, AMT, AKAM, EXXI, AN, WLL. Short AVGO JKS

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