Wednesday, January 18, 2012

Thursday Game Plan

Markets were higher once Wednesday with the Nasdaq outperforming. The Nasdaq was up 1.5% on solid volume. The S&P 500 rose 1.1%, closing above the much hyped 1300 level. Keeping abreast of leading stocks which is essential to gauge authentic market health, saw CBI break out from a 42.02 cup with handle base. KLAC took out a flat base trigger of 49.85 as well. A lot more however broke out on volume that was insufficient, below the 40% minimum average daily volume threshold. They included ORLY DLTR V COH AET AAPL. Volume could confirm in the near term, but I prefer to see it on the day of the break out itself. The Nasdaq was certainly helped by the semis today as the SMH roared ahead by 4%. A well received earnings report by LLTC, set the group blazing ahead with TXN up 8.5%, XLNX 6%, MCHP 5.5%. XLF was 1.5% higher as GS rose 7% on monster volume, as its earnings report was cheered on Wall St. JPM rose almost 5%, and it set for a clash with its 200 day MA just above. XLE retook its 40 week MA today, as apparently the 5th time it attempted to break through was successful. CVX shrugged off a downgrade, EOG NBL both have carved out bullish cup with handle bases, and MUR reclaimed its 200 day MA. Stocks currently building their right sides and that are to be included on watch lists are FDX TRN CAT DOV JEC RS CE MRO SGY CPO AVT DE. X had a bullish outside day today. PM dropped 3.5% today, losing its 10 week MA in the process. Perhaps that is an indication of risk on appetite progressing. Is TIF a value play? I do not usually get involved in these situations, but a triple bottom looks to be developing here. Earnings come tomorrow from heavyweights INTC UNP GOOG IBM.

Stocks near specific buy points include cup with handles QCOM 58.07, CBS 28.72, VRSN 36.55, TROW 60.86, PXP 39.47, NBL 100.08, EOG 107.37, TYC 49.71, HXL 26.17, TMK 44.93. Cup bases are KMT 45.76, BUD 64.63, IP 33.11, OMC 49.65, BIIB 120.76, ASNA 35.35, KMX 34.91. Double bottoms are BBBY 63.48, HLF 57.55. XOM 86.77 in a double bottom with handle base. RAI 42.05 in a flat base buy point.

Stocks that can be bought as they retake their 40 week MAs and their buy stop spots are MMM 85.75, JPM 37.40, TD 78.25, SOA 19.20, WLL 53.10, TPX 60.95, FCX 45. COP MUR SGY all retook their 40 week MAs today.

Stocks that can be bought at 40 week support are BLL 36, COST 81. Stocks that found 40 week support today were KBR TAP COST CPX UA NEM.

Stocks that can be shorted at 40 week resistance are JOY 85.50, NTRS 42.10, COG 68, TGT 50.55, TIBX 26. COG TPX KO FCX all met 40 week resistance today.

Stocks that can be bought at 10 week support are DEO 85, ABT 54.55, GBX 22.90. APC KEG DGX all found 10 week support today. AMZN can be bought with a buy stop above its 10 week MA at 191.50. CNI RL VFC NUS all retook 10 week support today.

Stocks that can be shorted as they lose 10 week support and their sell stop spots are BIDU 125, RAX 42.50, DGX 56.75. PM ED both lost 10 week support today.

Stocks that can be shorted at 10 week resistance are SWI 30, ANN 24.15. AMZN DPZ both met 10 week resistance today.

Good luck.

The author owns WFC CL. Short DPZ KO. We bought WFC this morning as it held its 29.73 double bottom buy point. Bought WFC at 29.81. We bought CL at 90.30 as it retook its 10 week MA.

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