By: Scott Redler
Make sure you’re not there when they “TURN OUT THE LIGHTS.“
Last week I pointed out some concerning action. It started when some old leaders broke their upper levels. Then, some of these leaders pierced their 50-day moving averages. Overall, we had 2 distribution days last week. Although it usually takes 4 to break an uptrend, we must take notice. On Friday, the market could have applauded Intel (INTC) and JP Morgan (JPM), but instead sold them.
Add these little tidbits up together and the result demands CAUTION! Hopefully you were ahead of the curve in anticipating this action by either selling covered calls, buying puts for protection, or just cleaning up your positions.
This will be a stock picker’s market ALL YEAR–there will be times to be long, times to be short and times to be neutral and on your toes.
Big Cap Tech:
- Amazon (AMZN) started it off by putting in a double top. The stock then broke its 50-day moving average. Now it’s testing BIG support at $125ish.
- GOOG broke its upper range, then broke its 50-day on the China news. It technically looks a bit broken right now.
- Apple (AAPL) is desperately trying to hold its upper range with earnings around the corner.
- Baidu (BIDU) was a monster last week based on the premise that they could expand if/when Google leaves China.
The Rundown:
- Financials–Goldman Sachs (GS) was like an elevator–a great long from $165-176, but now it’s had a round-trip and is back below it’s 50-day–that’s “not good.” JPM sold off on its decent earnings. Bank of America (BAC) and Citigroup (C) are both not compelling right now.
- The casinos had a great run and need a break.
- Oil went from overbought to oversold in just five days. The Oil Service Holders (OIH) needs a break here.
- China Agritech (CAGC), China Automotive Systems (CAAS) and RINO International (RINO) all broke out and then came back down to Earth quickly–this shows you that you have to be on top of your positions.
- The shippers suck–anytime they run it seems like the market is near a short-term top.
- The ags are very sloppy and need some time.
BIG SUPPORT in the S&P is in the 1,124-1,126 area. Then we’re looking at 1,119-1,121. The 50-day moving average is at 1,110.
This week we will have A LOT OF EARNINGS–make sure you know the schedule and closely follow the recent trading activity of your positions.
GO SCOTT BROWN–if the Republicans can take the Mass Senate seat, it shows how disappointed Americans are with the “policy” of this new administration.
I try not to think about it, it gets me LIVID!!!!!!!
