Thursday, November 3, 2011

Wednesday After Market

Markets rallied Wednesday, finishing higher for the first time in November. Volume was tepid at best however, suggesting many big market players remain unconvinced. The S&P 500 outperformed the Nazz gaining 1.6%, compared to the latters 1.3%. Indexes closed near their highs for the session, and other bullish traits sprung up today. More leading stocks are setting up bases as discussed in the next paragraph. Some broke out today including GNC from a 25.96 double bottom with handle buy point. It certainly helps as well to see how recent breakouts are faring to gauge the markets health. Two recent ones that come to mind are COG HUM. HUM added another 2.5% on top of the 80.74 double bottom buy point it took out Monday on earnings. COG is now better than 2% higher after clearing its 78.75 double bottom buy point. Stocks reacted well to earnings reports today as well with the likes of PXD gaining 13%, EOG 11%, PAG 10%, MA 7%. SMH traded lower demonstrating some weak relative strength today. Some outperformers in the group included SIMO up 22% today, and KLAC NVLS both up 1%. I am not wildly bullish here, but you have to be prepared for either way the market may turn. As always buy strength, and sell weakness. Today that was evidenced by JAZZ which turned south after hitting 50 day resistance and finished lower on a nice tape today. MAKO encountered 50 day resistance as well today. Indeed the weak do get weaker. Stocks trading higher in after hours action include QCOM up 10%, and WFM down 5%. WFM had a bearish outside day on huge volume Wednesday on a benign tape on huge volume, before earnings were released after the close. That is one of those things that makes you go hmmmmmmm. Earnings come Thursday from SBUX APA CBOE CBS CHK ED DTV EL HANS IACI K MTZ MCHP WNR.

Stocks near specific buy points include cup bases NEM 71.35, PVH 75.96. BBBY in a 3 week tight pattern with a buy point of 63.40. BEAV 39.08 in a cup with handle base. Double bottoms with handles are WNR 17.87 (earnings Thursday), PXD 99.74. FE has a flat base buy point of 46.61. Many stocks are now one day from completing handles in valid bases whether they be double bottom or cups. Stocks in that process include MCO AXP ORCL ABV DSW TIF UNP JOYG.

Stocks that can be bought as they reclaim their 200 day MAs and their buy stop spots are JNY 12.25, KKR 15.25, PAY 44.15, EOG 101, VLO 25.45, JOYG 88.15. GG FMC both reclaimed their 40 week MAs. Stocks that can be bought near 200 day support are NVLS 33.50, SWN 40.10, BWA 72.25, FL 21. Stocks that found 40 week support Wednesday were NTGR R CTXS CBS NVLS JBL. Stocks that can be shorted at 200 day resistance are CMI 101, XLNX 32.50. Stocks that encountered 40 week resistance Wednesday were JNY ADP XRAY CMCSA LLTC CBOE PX NBL RDSA WYNN CMI. XLNX lost its 200 day MA today having a bearish outside day in the process.

Stocks that can be bought as they reclaim their 50 day MAs and their buy stop spots are KO 68.60, AA 10.95. BHP RIO JPM WFC CVI X all retook their 10 week MAs. Stocks that can be bought near 50 day support are ED 57, SO 42.25, BUD 53.35, DLTR 76, SBUX 39.60 (earnings Thur) V 89.10, ALXN 63.75, BMY 31.05, ARMH 27.40, BBT 22, CRZO 26, SLB 69.25, X 25, WY 16.95. FCX EBAY DE CELG BMY all found 50 day support Wednesday. Stocks that can be shorted as they lose 10 week support and their sell stop spots are LULU 53.75, ROVI 45.75. WFM IACI NVDA EXPD all lost their respective 10 week MAs Wednesday. Stocks that can be shorted at 50 day resistance are AMZN 222.50, HSY 58.50, WPI 67.95, HFC 32. HANS BAX AVGO HAL all encountered 10 week resistance Wednesday.

Stocks that have gapped up and can be bought within that gap up as long as it remains intact are MCD 91.25, ORLY 75, SWI 27.

Good luck.

The author owns FCX DE ORCL.

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