Friday, April 22, 2011

Weekend Stock Reflections

Markets continued there bullish tone Thursday in a shortened week with the markets closed for Good Friday. During the week, full of earnings reports, the Nasdaq and S&P 500 both reclaimed their 50 day MAs. The Nasdaq outperformed the S&P 500, as the tech index rallied 2%, while the S&P 500 gained 1.3%. Indexes are approaching resistance levels here with the Nasdaq near 2840 and the S&P 500 at 1340. With another big earnings load this coming week perhaps those resistance levels can be taken out. Lending further credence to the rally was the positive action that leading stocks provided. Many broke out, which we know is a strong baromter to overall market health. Socks hitting all time highs Thursday were A WAT UTX OPEN IBM LULU TIF RL. Both the SMH XLE groups are returning to the limelight after some recent trouble. Both the SDS VXX were again repelled at their 50 day MAs during the week. Keep in mind that volatility increases during the bulk of earnings season, so keep that in mind. Earnings next Monday come from SOHU BEAV CBE before the open and NFLX after the bell. New home sales will also be reported.

Stocks near specific buy points are: Cup with handles BHI 75.20, CLR 73.58, DVN 93.66, XOM 88.33, HAL 50.84, MRO 54.29, NOV 82.90, NBL 99.09, RDSA 75.34, SPN 41.75, AGCO 57.30, VRSN 37.60, AMP 63.88, FDX 96.60, FLIR 35.41, JWN 47.38. Cup bases DOV 68.17, AET 39.33, AVT 37.26, TXN 36.81, HOT 65.61, CHRW 82.15, PETM 43.49, QCOM 59.94, ABV 32.10, ABX 55.82, RKT 74.36, SIAL 68.02. Flat bases CXO 110.99, COP 81.90, WMB 31.99, SWK 77.57, PPO 61.85, WDR 42.59, PLCM 52.20, SBUX 38.31, CMCSA 26.01. Double bottoms MOS 83.51, ARMH 31.43, AAPL 354.42, JNPR 42.37, EXPD 55.21, OMC 49.88, TRW 56.58. Double bottom with handles are BG 74.50, R 52.16, AMZN 188.37, CMI 113.75. 3 week tight patterns MSI 44.86, IP 31.10, DD 56.62, DKS 41.93. 4 week tight is WCRX 24.43, and DTV 47.70 in a square box pattern. HON cleared a 60.12 cup with handle post earnings. CPX cleared a 32.59 cup with handle buy point as well. DOW cleared a 39.10 flat base buy point Thursday too. DHR cleared a 53.11 flat base buy point on earnings then reversed. IL is right back to its 30.41 cup base buy point it cleared on Wednesday. This is completely normal action, and remember to cut all losses at 7% from your purchase point no matter what.

Stocks that can be purchased as they reclaim their 50 day MAs and their buy stop spots are CHK 33.35, OXY 101.75, BTU 67.75, PBR 39.60, SLB 90.75, AGU 92.75, POT 59.15, JBL 20.90, BRCM 40.90, RVBD 38.50, UPS 73.85, MTL 30.25, GSM 22.40, EBAY 32.55, ADM 36.40. Stocks that reclaimed their 50 day MAs Thursday were CXO CI NOV SU VLO AA VALE BRCM CY MXIM HOT COF BWA PAG. Stocks near 50 day support are CVX 104, GPOR 30.50, PXD 100, SGY 30, UPL 46.80, WNR 17, CBE 64.50, JOYG 95.50, PLL 56.20, LYB 39.75, STJ 50, VAIB 46, DHR 51.25, CHKP 50.25, ORCL 32.80, AVGO 32, CY 20, BLL 36, DFS 23, ADP 50.75, GR 86, EAT 24.30, DKS 39.30, EL 93.50, CBI 38, VAL 38.50, CLF 94.50, ROSE 44, ROC 47.60. Stocks that found 50 day support Thursday were APA EXXI IO ARBA CNI SLW. WLT had an enormous 10 point intraday reversal off of a bounce from its 50 day MA Thursday post earnings.

Stocks near 200 day support are NOG 22.25, SUN 39.45, RIG 68.25, WFT 19.85, JBL 17, LRCX 47, TROW 58.75, MTL 27, X 50.80, AMX 55, PAAS 33. HMC reclaimed its 200 day MA, while GOLD MS found 200 day resistance after trying intraday to reclaim that line. Stocks that can be shorted at 200 day resistance are NKE 81, RIMM 56.25, MAR 37.50.

Stocks that can be shorted at 50 day resistance are APC 80.25, HES 82.25, MDR 24, MON 70, URI 32, CSX 76, WY 24, JPM 46. Stocks whihc ran into 50 day resistance Thursday were APC BEXP OXY SLB AGU APH BMC VSEA CSX UNP AEM AMT.

A quick look at bifurcating action within sectors is always a good idea. Lets take 2 groups today. In the semis group which behaved relatively well Thursday if you were not in the right stocks you could have been hurt. While stocks like ATML CY MSCC ARMH all powered ahead laggards like CREE CRUS fell. Stick with strength. Im not endorsing a pairs trade here but they could develop. In the gold sector, lets compare the strength of GG ABX as opposed to the weakness in AEM. Again leave the laggards for the guys who specialize in value. Buy strength and sell weakness.

Good luck.

The author owns TTM F RAX FCX.

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