Wednesday, October 19, 2011

Wednesday After Market

Markets lost ground Wednesday, displayed bearish behavior by closing hard upon the lows. The Nazz lost 2% on higher volume, but did manage to close above the 2600 level. A small solace. The S&P 500 lost 1.2% on lower volume closing above the closely watched 1200 level. A good gauge to determine market health is the action of its leaders. Today AMZN MA were both down 5%. QCOM V both lower by 4%. JAZZ is now down 12% in the last 2 days and surrendering its 50 day MA in the process. Of course other recent leaders which have acted poorly are the two 800 lb gorillas AAPL IBM. When you lose the generals its hardly ever a good sign. Even more bearish has been the action of stocks reporting earnings. Its been very hard to find stocks that have acted well. One exception among the 200 stocks we follow was DPZ. Up another 4% today after yesterdays 7% pop post earnings. More familiar however are the stories after hours of CRUS 13%, WYNN EBAY both 4%. Today's strength came from defensive sectors such as utilities and alcohol. Not the growth engines we need to power ahead. A quick suggestion for a alcohol pair, could be long DEO/short TAP. The banks hit concrete walls at their 50 day MAs. They included GS JPM. NTRS PNC both had negative reversals. Copper was weak with JJC down by 5%. Would love to blame that on the late day weakness after the Beige Book, but it was lower well before 2pm. FCX in my opinion held up well today. Full disclosure, I own it. Chemicals were weak today with ALB down 8%, CE EMN both down 5%. Gold miners were slaughtered as well with GG ABX both down 5% or more. Even group leader NEM pierced its 50 day MA today and closed below it for the first time since August. Tomorrow companies reporting and therefore headed for the firing squad are ALXN ADS ALTR ATHN BAX BBT CMG DHR DO NBL NUE PENN PM TPX UNP.

Stocks near exact buy points which should be bought obviously on very strong volume and with a little trepidation in this environment are cup with handles AMT 56.43, KSU 59.97, JBL 20.74. Double bottom with handles are WMT 56.49, KLAC 44.69. ACN looks like its putting on a handle to its cup base. Needs to more days to form. Be patient and wait for the breakout.

Stocks near 50 day support are UA 69, SBUX 38.60, AKAM 22, ARUN 21, IACI 39, AAPL 378, CBS 23, VZ 36, ARMH 26.80, AVGO 33, SWKS 20.50, BBT 21.30, EOG 85, HFC 32.05, NOV 62, EXPD 43, FDX 74, UNP 88.25, UTX 72, DHR 43.50, CAT 82.50, DOV 52, JOYG 75, BWA 66.25, NUE 33.75. Stocks that found 50 day support today were GNC PLCM KKR SU CMI. DVN can be bought with a buy stop of 62.70 as it reclaims its 50 day MA, which it did today intra day. XRAY retook its 50 day MA today. Stocks that can be shorted as they lose their 50 day MAs and their sell stops are CMG 309 (earnings Thursday), MCD 87.75, ADS 91.75 (earnings Thursday), ATHN 59.50 (earnings Thursday), CERN 65, FTNT 18, WPI 66.10, DOW 26.10, CMI 89.65. Stocks that lost 50 day support today were MA XLNX ALB BHI COG ABB. Stocks that can be shorted at 50 day resistance are TAP 42, MA 327, JAZZ 41, A 34, FWLT 21. Stocks that met 50 day resistance today were TAP PM BIDU AET VIAB ALTR GS IBN SLB WYNN A FWLT.

Stocks near 200 day support are ANN 25.75, BIG 36, K 54.10, MON 69.80, SWI 22.90, INTU 50, TIBX 25.05, VMW 90, ADP 50.80, BSFT 36, MTZ 19, ASML 38.65, PX 99.80, APC 75.90, CVX 100.25, RDSA WNR both here. Stocks that found 200 day support today were BIG ORCL DTV BRCM MXIM CBOE RDSA WNR CNI JBL. Buy stops for these two as they retake their 200 day MAs are XOM 80, SWN 40.30. Stocks that can be shorted as they lose their 200 day MAs and their sell stop spots are LULU 47.75, KO 66.15, ARBA 30. Stocks that lost their 200 day MAs today were GMCR YUM RAX JNJ CMCSA QCOM NSC LVS. Stocks that can be shorted at 200 day resistance are FOSL 95, GMCR 74.75, WSM 36.50, YUM 52, LMT 77.50, DFS 23.50, SAP 58, CHRW 74.50. Stocks that met 200 day resistance today were DKS FOSL WSM NDAQ SAP ABC GRA CHRW PCLN.

Good luck.

The author owns FCX DE.

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