Thursday, January 19, 2012

Friday Game Plan

Markets edged higher once again Thursday as both indexes we follow are now trading comfortably above October highs and their respective 200 day MAs. The Nasdaq outperformed once again today, and volume backed up the move. The Nasdaq is now nearing its own round number of 2800. The S&P 500 has now traded consecutive days above its own big number of 1300. We had another breakout from a leading stock today brought to you by FFIV, which eclipsed a 117.40 cup with handle trigger after an earnings report this morning. Looking how others have fared post breakouts are holding up very well. BEAV is now 6% past its 40.10 cup with handle, WFM 4% since its 74.55 cup base trigger, AAP 4% past its 71.10 flat base trigger and ADP 3% past its 55.12 cup base trigger. CBI added another 2.5% today, one day after taking out a 42.02 cup with handle trigger. SWI has to be given an honorable mention with a 8% move reclaiming its 10 week in the process.

Looking at sectors today showed the XLF in focus as it printed a 14 handle, retaking its 40 week today for the first time since May. JPM NTRS TD all ran right into 40 week resistance today. GS continued its move after earnings Wednesday gaining 3% today. AMP looks better with each passing day, as it recently retook its 40 week 2 weeks ago. XLE has recorded back to back closes above its 40 week MA since August. FTI has set up a nice flat base, XOM took out a double bottom with handle trigger, albeit on very soft trade. COG has turned in a very short period of time from prince to frog. Lost 6% today after hitting 40 week resistance. IYT volume starting to kick back in as it rolls toward par. FDX is doing the same building its right side of its cup in a visually sweet way. UNP had a blowout quarter today, closing up 2%, but on session lows. XLU continues to trade below its 10 week after hitting resistance their today. SO is setting up a nice short trade, with a possible move undercutting its 10 week.

Of course there were many reports after the close. GOOG was sharply lower. ISRG was down as well. MSFT INTC IBM were all higher. The Dow may get a boost if IBM continues higher as it is a trade weighted index and therefore IBM has the biggest impact on that benchmark.

Stocks near specific buy points include cup bases FDX 98.76, R 60.48, CAT 112.53, KMT 45.76, BUD 64.63, BLL 40.66, IP 33.11, OMC 49.65, BIIB 120.76, KMX 34.91. Cup with handles arE TMK 44.93, HXL 26.17, TYC 49.71, EOG 107.37, NBL 100.08, PXP 39.47, JWN 50.94, VRSN 36.55, QCOM 58.07. Double bottoms are RL 152.10, BBBY 63.48, PII 63.16. FTI 54.98 in a flat base buy point.

Stocks that can be bought as they retake their 40 wk MAs and their buy stop spots are ATI 53.75, TD 78.10, TCK 43.25, SOA 19.20, FCX 45.25. JOY MMM TGT TPX all retook their 40 week MAs today.

Stocks that can be bought at 40 week support are DOV 58.50, KBR 31.25, MMM 85.10, STLD 14.15, MUR 59, COST 80.90. TAP COP SGY all found 40 week support today.

TIBX can be shorted at 26, 40 week resistance. JPM NTRS KO all met 40 week resistance today. NEM lost 40 week support today.

Stocks that can be bought as they reclaim their 10 week MAs and their buy stop spots are CPX 34.15. SWI AMZN both retook their 10 week MAs today.

Stocks that can be bought at 10 week support are X 26.25, APC 78, GBX 22.90. DEO RL SBH CL all found 10 week support today.

Stocks that can be shorted as they lose 10 week support and their sell stop spots are RAX 42.50, RAI 40, SO 44.15. BIDU lost its 10 week today.

Stocks that can be shorted at 10 week resistance are PM 75, MA 362, ED 59.15, TGT 51.90. IBM CPX VFC ANN DPZ all met 10 week resistance today.

Good luck.

The author owns CL WFC XOM. Short DPZ KO. We bought XOM as it crosses a 86.77 double bottom with handle buy point. Volume ended very soft. Will keep on a tight leash. Tried to short JOY today at 40 week resistance and ended losing $1. Cut the trade short as the catalyst was gone.

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