For the first time in a long time market participants are getting paid both long and short. I covered most my shorts yesterday around the 1185 area in the S&P and will start testing levels for a bounce. Be very stock specific, just as we were in the late stages of the rally, as groups are taking turns going lower and breaking levels. After a yesterday’s washout we have finally gotten the decent correction we were anticipating at some stage, and now this is a period to be light on your feet and prepared for anything.
Most high beta tech stocks broke their 21-day moving averages and some are already testing their 50-day. The S&P hit 1173 yesterday and we are oversold enough to get a bounce, but I’m not sure what type of bounce we will get from this area. My gut tells me a better bounce comes from the 1155-1165 area if we can pull into that level.
Tech.
Apple Inc. (Nasdaq:AAPL) broke the 21-day but is still holding above its 50-day. I’m not convinced that the 300 level will hold in Apple but we’ll see. I have it listed as a Red Dog reversal candidate through $299.32.
Baidu.com, Inc. (Nasdaq:BIDU) was a great short yesterday as it broke its upper level, and is now coming into bigger support. Watch yesterday’s low for a pivot in Baidu, it could also be an early short through that level and then a Red Dog reversal candidate back up through it.
Google Inc. (Nasdaq:GOOG) has much of the same story, it has been crushed the past couple of days and is a reversal candidate using yesterday’s low as the pivot.
Amazon.com, Inc. (Nasdaq:AMZN) was the first stock to break its 21-day but held firm above the 50-day yesterday. I would look to trade this one long versus yesterday’s low.
Riverbed Technology, Inc. (Nasdaq:RVBD) was a late addition to our go-to list after earnings, but take caution with it here as it is breaking down through its upper level.
Goldman Sachs Group Inc. (NYSE:GS) is still above its 21-day and holding up better than most stocks amid this broader market weakness. Goldman has reasserted itself as the cream of the financial crop, and it feels like the only bank worth owning at this point. If the market can get a bid, this seems like one that can be a first mover higher.
Bank of America Corp (NYSE:BAC) on the other hand has been a dog, with fraudclosure accounting for the latest bout of selling pressure. The only way I see Bank of America becoming a compelling long is if there is some more definitive resolution in regards to the foreclosure mess.
Wynn Resorts Limited (Nasdaq:WYNN) has pulled in considerably but is a bounce candidate in my mind as it has held far above its 50-day.
Las Vegas Sands Corp (NYSE:LVS) had a monster run, and the fall has been nearly as hard for the casino stock. A pull-in after such a strong run is healthy enough, now we are looking to buy 45-46.
Oil Service HOLDRs (ETF) (NYSE:OIH) has held up better than most with the oil group, and is still above its 21-day.
SPDR Gold Trust (ETF) (NYSE:GLD) is worth a look vs 129-130. Yesterday was the first day looking for a bounce, and I’m still skeptical that this is more than just a small bounce candidate for now.
