Wednesday, November 16, 2011

Wednesday Game Plan

Markets staged a decent reversal Tuesday, most evident in tech. The Nasdaq however was met again with stiff resistance at the 40 week MA at 2687. The "Tuesday Turnaround" effect was in at least for the Nasdaq. Helped by INTC which hit a 3 year high on brisk volume. The SMH has been outperforming and it setting up a trigger buy point of 32.84. Action from leading stocks has been mixed. AMZN, which comprises more than 2% of the Nasdaq index, did not participate in the Nasdaq's 1.1% advance. It met 10 week resistance Monday. CVX had a negative outside reversal day. But a look at VRSK and UA on their weekly charts are trading very tightly after breakouts which is bullish. If they continue this action they will complete the 3 week tight patterns, that both M and DEO are now enjoying. DPZ broke out of a 33.10 4 week tight pattern buy point on weak volume. Not great action. It is reminiscent of last Mondays NEM break out from a 71.35 cup base buy point which has not worked well, at least for now. Commodities have been kept on a leash with the UUP advancing back above its 10 week MA. Crude has been battling with par, and the JJC flirting with 10 week resistance here as well. Earnings Wednesday include LTD TGT SBH TYC among the stocks we follow.

Stocks near specific buy points include cup with handles COH 66.64, RAX 45.56, ABV 34.89, INTU 55.53, BEAV 40.14, ORCL 33.91, PPG 90.10, OXY 101.75, PXP 37.01, UNP 103.90, Double bottom with handles are PM 72.59, TIF 81.09, BIDU 147.78, AXP 52.45, ARMH 31.65, PLL 54.18. Double bottoms are AET 41.95, QCOM 59.58, CXO 99.57. Cup with high handles are HXL 26.58, CHKP 61.70. FE 46.10 in a 4 week tight base, M 32.77 and DEO 86.10 in 3 week tight bases. V 95.97 in a square box pattern.

Stocks that can be bought as they reclaim their 40 week MAs and their buy stop spots are AKAM 30.50, XOM 80.25, NOV 72.25, VLO 25.25, EMR 52.60, UTX 81.25, AVT 31.55, DHR 49.85, ATU 24.40, CAT 98.30, JOYG 88.25, NUE 40.75, JBHT 43.25. CRM MCO XRAY DTV retook their 40 week MAs Tuesday. Stocks that can be bought as they reclaim their 10 week MAs and their buy stop spots are WFM 69.25, AA 10.75.

Stocks that can be bought near 40 week support are BUD 56.50, WSM 38, KO 67, SAP 58.50, XRAY 36, CBS 25, FMC 80, EOG 100, RDSA 69.50, PH 82.25, PAG 20. HSY DFS PAY LLTC XLNX EXXI HON all found 40 week support Tuesday. Stocks that can be bought at 10 week support are ALXN 65, CELG 63.95, BBT 22.20, BK 209, CRZO 25.75, TCK 36. Stocks that found 10 week support Tuesday were BHP CMG DSW JWN PCP NVDA JPM MS WFC.

Stocks that can be shorted at 40 week resistance are ADI 37.05, TXN 31.75, CVI 23.05, CMI 100.50. Stocks that met 40 week resistance Tuesday were JNY EBAY ADI AVGO COP XOM VLO AVT CMI. Stocks that can be shorted at 10 week resistance are AAPL 395, JAZZ 40.75, GS 101, BTU 40.75, WYNN 134.50, BWA 68. TAP BAX GS BWA WY all met 10 week resistance Tuesday. Stocks that can be shorted as they lose their 10 week MAs and their sell stops are CMG 319, DLTR 77, WFC 24.65, ITW 45.10. AGY BMY lost 10 week support Tuesday.

Good luck.

The author owns FCX DE WMT. Short LULU. The WMT/LULU pair is being kept on a small leash here.

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