Sunday, December 11, 2011

Monday Game Plan

Markets enjoyed a nice up day Friday, but for the week both were higher by less than 1%. They continue to struggle at the 40 week MAs. The markets demeanor would look much better with a push above those lines this week. The lines in the sand for the S&P 500 lies at 1263, less than 1% away, and the Nasdaq's is 2665. The Nasdaq did manage to find support right at its 10 week MA Thursday. Both indexes remain down YTD a small 0.2%. Crazy after the volatility we have noticed this year. I must say I was surprised by pouring over hundreds out charts this weekend, how many are consolidating above their 10 week support lines and forming valid bases. I remain a cautious bull, as some sector rotation has been transpiring quietly here in the last few weeks. Moving up steadily are groups such as transports, chips, retail, while disappearing from top ranks are utilities and alcohol. A look at some of the strengthening groups is in order. IYT finished flat for the week as it, like the indexes do, battle with its 200 day. Put in a buy stop above 90.45 and buy a one way ticket to par. Favorites in the group are TRN JBHT KSU CNI. KSU has been the undisputed leader and it may trade back to its 62.86 cup base buy point it broke out from 10/27. That would also be 10 week support, and remember its absolutely normal for leaders that have broke out to go back and retest that previous buy point. XRT in my opinion, maintains one of the best ETFs charts out there. Still sporting its 55.02 cup with handle buy point. Components within the group are WRC, (which believe it or not is having issues with its 200 day!!), is carving a 54.05 double bottom with handle buy point. Give the handle one more day and perhaps a "speedo" revolution can occur! Dating back to 9/08 on the weekly chart WMT is displaying a 59.50 cup with handle trigger point. Very bullish. WSM has the inverted head and shoulders base on top of its cup with handle buy point of 40.17. NKE VFC both have flat base buy points. VFC 142.60, NKE 97.78. With jobless claims showing some of their best results this week some of the employee equities perked up. PAYX RHI both retook their 200 day MAs this week and RHI now has a valid double bottom buy point of 30.26. Other groups that surfaced while I charted were the smaller auto related stocks. Nice base building and accumulation being exhibited by the likes of SAH LAD PAG ABG. Let us be careful as always and this could be a nice week IF benchmarks break above their 40 week MAs and more leading stocks break out from their trigger points described in the next paragraph.

Stocks near specific buy points include cup with handles CNC 39.17, BEAV 40.14, BA 72.86, CNI 80.54, TYC 48.62, AAP 71.10, SAH 16.32, WMT 59.50, WSM 40.17, INTU 55.53, PXP 37.01, NTGR 38.57, BUD 61.08, MRK 36.35, DGX 59.54, WFC 27.30, MKC 50.19. QCOM 58.07, BYI 39.46, RAX 45.56. Cup base buy points include ABG 22.10, SCSS 22.29, ADP 55.12, ABV 36.40, EFX 40.00, 61.00. Double bottom with handle buy points include DKS 42.21, JOYG 93.94, CBI 42.02, CXO 102.07, NOV 76.15. Flat base buy points are NKE 97.78, DEO 86.10, ABT 55.71, ED 59.99. Cup with high handles are HXL 26.58, RCII 37.47. FE has a 46.20 double bottom buy point and KEX still remains in a 4 week tight pattern with a trigger of 65.56.

Stocks that can be bought as they reclaim their 40 week MAs and their buy stops spots are WRC 52.75, CY 19.25, RTN 46.20, SPR 20.30, FDX 85.60, TRN 30.40, EMR 51.90, MWV 30.25, ARO 17.45, ASNA 30.25, AKAM 29.60, OMC 44.90, TRV 56.50, CAT 98.40, CBE 56.50, PH 81.90, CE 45.80, KEG 15.20, OXY 95.50, TWI 23.25, FISV 59.15, RJF 31.80, DE 81.75. Stocks that retook 40 week support Friday were PMTC COP EXXI KO.

Stocks that can be bought at 40 week support are BA 69.20, KMX 30, CTCT 25.30, ROK 75.55, VAL 35.10, EOG 99.55, XOM 79.05, HP 58.50, AET 40, VAR 62.60. Stocks that found 40 week support today were MENT JOY HP NOV DFS TROW CPO QCOM ABX MON.

Stocks that can be bought at 10 week support are CNI 75.50, KSU 68.26, COST 83.20, LKQX 28.50, SBUX 42, RATE 18, NUAN 24.15, COG 77, BIIB 108, EL 105. Stocks that found 10 week support Friday were COH VFC CY ASNA DKS ACN SAP TIBX ATU APA AAPL NEM.

Stocks that can be bought as they reclaim their 10 week MAs and their buy stop spots are DECK 105, DSW 49, CELG 64.10. NUAN BHP PII all retook their 10 week MAs Friday.

Stocks that can be shorted at 200 day resistance are ARMH 27.85, AMZN 202, LULU 50.75, TIF 70.40, BIDU 136, CERN here. WRC TRN EMR MWV SAPE PH KEG WDC all met 200 day resistance Friday. You can put a sell stop in at 35 for JAZZ, as it loses 200 day support.

Stocks that can be shorted at 10 week resistance are AVGO 32.45, ALXN 66, HLF 56. RL DECK both met 10 week resistance Friday.

Good luck.

The author owns JEC ROK GIS.

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