Thursday, October 21, 2010

AM Musings

Markets paired gains somewhat yesterday in a light volume rebound recouping little more than half of Tuesdays losses. A weak dollar and benign earnings reports were responsible. Earnings season is obviously in full swing with both NFLX EBAY trading higher in after market action. Today you can expect earnings reports from a number of Dow components. Big reports today come from MCD T AXP CAT AMZN FCX CMG.

Stocks forming specific buy points include: WLT @89.33, SOA @18.17, CE @34.90, TKC @19.48, DOV @55.07, CAKE @28.44. All previously mentioned were cup with handle patterns. Now these next four stocks have cup with high handles: MUR @66.57, PXD @74.59, JNPR @32.94, BUCY @75.98.

GOOG had an intraday reversal closing basically UNCH. Strange action for a good day and was responsible for most of the paired gains on the Nasdaq yesterday.

MT prepared for its 200 day MA battle. Put in a buy stop over 36 if it can muster the strength to pull away from that line of resistance.

Laggards that can not hide their stripes and fell yesterday on a positive day include PBR URBN VLTR. Keep an eye on these to short if they trend back to resistance lines and fail again.

Good luck.

The author owns FCX ORCL RADS WLL APA SMG. Short AVGO.

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