Monday Thoughts

Markets took a beating early but managed to cut their losses in half. A morning call by S&P to cut its long term outlook on the USA triggered the morning sell off. The S&P 500 and the Nasdaq both fell below their 50 day MAs. Weakest sectors Monday were basic materials, oil and gas, and healthcare. Leading stocks were generally soft, and earnings results were mixed. CAT, a long time leader, closed below its 50 day MA in big volume for the first time since last August. AAPL had a nice intraday reversal to the upside. On the earnings front, HAL finished higher, while after the close TXN was down nearly 2%. As we have noted recently the semiconductors lagged with the SMH finding seemingly never ending resistance at its 50 day MA. Now the energy group has joined the semis as the group has suffered. XLE has been having its own problems with its 50 day MA and on both the SMH XLE down days have come on big volume. When two leading groups play the disappearing act it normally signals caution at the very least. More concerning is where the rotation has been shifting to. Consumer and medical related companies. Both the SDS VXX are knocking on their 50 day MA doors and may soon pierce above them. In fact that is just what SDS did today. As always pay close attention to the indexes and the leading stocks. Earnings due on Tuesday include GS before the open and VMW INTC JNPR after the close. Housing starts also will be reported tomorrow.

Stocks near specific buy points include among he vast array from yesterday, cup with handles UPL 50.91, JWN 47.38, CPX 32.59. Double bottoms MJN 61.56, COH 56.81. Double bottom with handle is SIAL 66.35. 3 week tight pattern is VIAB 47.97. All these stocks performed reasonably well or found support at MAs, considering the markets pain.

Stocks near 50 day support are GPOR 30, HAL 46.50, OIS 74, SGY 29.75, SPN 38, WNR 16.60, WLL 67, CBE 64.50, BGC 43.10, ABC 38.05, HS 36.75, STJ 49.50, VPHM 18.50, WAT 84.25, INFA 49, IL 27.05, ORCL 32.75, SMTC 24.10, BLL 36, IP 28.15, ADS 81.25, DFS 22.75, PAY 50.25, EXPD 50, ACN 53, ADP 50.50, DKS 39.05, SBUX 34.95, TIF 62, WFMI 61, TWC 70.95, CBI 37.75, KBR 35.10, BHP 94, CPO 49. Stocks that found 50 day support today were CVX CPX MRO WLT MTW ROK SWK CE EMN PPG SOA WLP CBS DTV ARW DHR ADSK CTXS VRSN ARMH ALTR BX UNP BEAV FLIR EAT JWN SBUX EL KBR ARUN TTM SLW ROC RKT. Stocks which can be bought as they retake heir 50 day MAs and their buy stop spots are PXD 100.75, HOT 59.80, OMC 49.10. SPRD AKAM both retook their 50 days today on upgrades.

Stocks near 200 day support are ACI 29.50, CAM 48, HES 70, SUN 39.30, RIG 68, WFT 19.75, WCRX 22, AGCO 45.50, AGU 82, MON 63.25, MOS 69, POT 50, APH 50.75, AVT 30.50, JBL 17, TTMI 13.30, ATML 10.35, CY 16.05, KLAC 38.20, LRCX 47, MXIM 22.10, NVLS 31.15, SNDK 44.05, VSEA 36, XLNX 29, JNPR 34.75, RVBD 30, UPS 70, NUE 42.05, GR 81.80, AMX 55, WY 19.10, ADM 32.40, TRW 48, FCX 48.40, JPM 41.80, IBN 47. Stocks which found 200 day support today were NOG PBR TCK C SWKS MTL VALE BBD. MT X ALV AMT all lost their 200 day MAs today.

Stocks that showed strong relative strength today were BHI CPX HAL VMW WYNN MAR HOT OPEN QCOM TPX ABX MOBI. LULU MELI also hit all time highs Monday.

Stocks that can be shorted as they lose their 50 day MAs and their sell stop spots are COP 76.50, EXXI 32.75, FTO 27.25, IO 11.65, MRO 50, NBL 90.50, WMB 29.60, PH 90.50, ROK 89.50, EMN 94.75, LYB 39.25, DTV 45.25, FCS 17.50, TDC 48.50, FAST 62.50. Stocks that can be shorted at 50 day resistance are CXO 104.75, APC 80, BEXP 34, CHK 33, NOV 79, VLO 28.50, ATML 13.75, AVGO 32, COF 51, URI 31.50, EBAY 32, PAG 20. Stocks that lost their 50 day MAs today were APA CAT PLL AET WCRX BG DE BRKR BMC UTX TROW URI WDR CSX YUM APKT CMI CLF RIO. 50 day resistance was met Monday with XOM SM JOYG DOW ARBA FCS DD EMC. Relative weakness today was seen by MDR VPHM CRUS.

Good luck.

The author owns TTM RAX F.