Sunday, February 27, 2011

Weekend Warrior

Are the markets climbing the proverbial wall of worry? Contagion, oil prices, massive amount of European debt coming soon, Irish and German elections. I could go on and on. Just follow the price and volume action of the indexes and leaders themselves. Markets delivered some big gains, but they did come on weak volume. Leading stocks like DECK had a 6% intraday reversal after hitting an all time high after earnings. Not the type of action you would like to see during an aging bull market. TLT, a bond ETF, reclaimed its 50 day MA Friday. Could that be an ominous sign for equities? Fridays strong price action still left the major indexes with decent sized losses for the week. The S&P and Nasdaq finished lower by 1.7 and 1.9% for the shortened 4 day week. But that being said the indexes did find support at their 50 day MAs during the week. The SOX, one of the strongest sectors of the year, outperformed Friday and ramped up 2%. AAPL found formidable support at its 50 day MA this week. Thats why its important to keep an eye open for both long and short set ups. Simply because we can have our own bias to where the market is headed, but I really do not know, and I have news for you. No one really does. Earnings to look for Monday include JKS before the open, and RRC BID after the close. Pending home sales and the Chicago Purchasers Index are released Monday.

Stocks near specific buy points include. Cup with handles are NUE 49.34, NOV 82.08, POT 64.07, EBAY 35.45, NDAQ 29.81, JPM 48.46, GLW 23.53, AMAT 16.77, NCR 20.72, UA 70.53 (which cup goes back 4 years). Flat bases are MXIM 28.54, HES 86.22, WAG 43.28, FISV 63.98, CTSH 77.84. Double bottoms are ABX 54.03, FCX 57.74, BBD 20.89, SCCO 47.73. 3 week tight pattern buy points are EMC 27.48, ROST 72.80, ADP 50.05, ADS 80.07. MON 76.79 in a double bottom with handle formation and XLNX 34.22 in a 4 weeks tight pattern. Stocks that recently took out buy points are faring ok. APC is back above its 80.70 flat base buy point it took out 2/17. BHI back above its 70.09 3 weeks tight pattern. SLW back above its 40.10 double bottom buy point. RIO, however remains below its 73.10 flat base buy point.

Stocks that can be bought if they reclaim their 50 day MAs are MCP 49.30, TRW 58.25, MT 37.50, TKR 50.20, A 42.75, ACI 34.25, VALE 35.10, PVH 61.25, FFIV 128, SINA 82.75, AAP 64.25, LVS 47.40, BUD 56.80, FWLT 36.50. Stocks which reclaimed their 50 day moving averages Friday were APA PETM HUN ADSK ORCL WFC CBI. Stocks nearing 50 day support are ADI 39, ATML 14, CY 20.75, KLAC 44, LRCX 52, NVLS 36, NVDA 21.05, SPRD 20.50, TXN 34.10, RS 53.75, DHR 48, CAT 97, DOV 61.40, JOYG 90.50, BP 46.50, MDR 21.10, OXY 99, BTU 62, WLL 60, BHP 91, GFI 16.90, TDC 44.75, RTN 49.50, COST 73, JWN 43, RAI 32.90, AMP 60.50, BX 16, ACN 50.75, CHKP 47, CNI 68.30, ARW 37.75, RIMM 62.50, APH 54.30, CRZO 34, RES 18, ERJ 32, WLP 62, SHLD 79, COF 48, PAG 18, NWL 18.80. Stocks that found solid 50 day support this week were ALTR ATML CY SWKS BHP PAAS NKE OPEN MOS POT RAX LULU CMG PPG WYNN TROW LEN INFA SNPS VRSN KSU BLL AMT SWC CCJ GRA.

Stocks near 200 day support are F 14, MGA 45, MIPS 10.15, AEM 68.25, LOGI 17.10, NTAP 48, MCD 74, ABV 25,CHRW 69, EXPD 46.25, TSM 11, NXL 18, BEAV 32.25, CBD 37, WM 35, UPL here. Stocks that found good 200 day support this week were BRCM ORLY INFY RHT ROVI VMW EXPD BBD. TTM can be bought thru 24.75, reclaiming its 200 day MA. TGT can be shorted near 54, its 200 day MA which may prove to be resistance. IBN LO both back below their 200 day MAs. BUD TAP both languishing below their 200 days. Look at SAM, an illiquid stock, but an indication that the beer market has too much competition from the smaller and more nimble, local, crafty guys? Although BUD has under its umbrella of brands Stella Artois, Becks, Michelob, Hoegaarden among many others. Maybe you learned something about BUD there. I did.

CXO, a chart of beauty, is up $10 after recently breaking through par on Valentines Day. CVX PXD now both over par. AGU PX next?

Gap up stocks holding tightly still which is very bullish behavior are EL RL IBM HP AET CMCSA WMB MMC. RDC had a nice gap up Friday. Put it on the watch list.

Natural gas plays are getting firm again. CHK EOG RRC leading the way. RJF is my favorite financial play. A beautiful chart hitting an all time high this week. ETFs again exposing the old BRIC names that I continue to find fascinating. PIN, India and FXI both under their 200 day MAs, EWZ finding tenuous support at its 200 day MA, but RSX continues higher to 2 1/2 year highs. Tax cuts work. Whoever thought tax cuts and autocrats would go hand and hand? Even they get it.

Stocks showing weakness include UNP NOC GOOG AMZN MCD SBUX TIF FLR COH VALE X all of which hit 50 day resistance and could not perforate those lines. They could next week but to not to do on a strong Friday might raise a little caution. XOM was a notable energy laggard. Stocks that can be shorted at their 50 day and its proves resistance are TEN 42.25, BRCM 44, LLTC 35, MSCC 23, MTL 31.50, TEL 36.30, BBBY 49, CE 42, SOA 24, HOT 62, GR 90. Stocks that can be shorted if they pierce their 50 day MAs to the downside are FCS 17, PH 87.75, NFLX 200, UPS 72.50.

Leading stocks that I am looking to enter very soon are CLR SWC BHI DVN BTU. Patience and discipline.

Good luck.

The author is flat.

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