I hope everyone had a great weekend! To start off this Sunday's Weekly Watch, take a look at yesterday's write up about our expectations for the coming week. As we stated, we have high hopes for what December brings. While the Fiscal Cliff is still looming, I believe that this will get settled and the market will test new highs before the end of the year. Enough of the fiscal cliff, though. Let's get to the more important stuff...the charts.
To start, we'll take a look at the futures. S&P futures are slightly higher as of now, up about $1.50 to 1416. We did dip to 1413.15 earler in the evening, but ripped higher quickly. If this is any indication for Monday's open, we could see a gap-up to 1420. This area is pivotal, and could be a gap and go, or a fade. I lean toward the gap and go, but stay on your toes regardless.
The SPX chart is holding in well, but is still slightly extended from its moving averages. What would be ideal, is a low volume sell-off to start the week. Possibly test 1400 and then rip higher. Granted, what the bulls usually want doesn't happen like this. Long story short, as long as we are holding higher than Wednesday's low, I think this bullish trend continues. Setting up a trading plan for all situations is your best bet, you can't be over-prepared.
Now as far as the rest of the market is concerned, there have been SO many great moves last week - it really almost depends on which sector you follow and which stocks you know the best, and you could have made good money. If you check last week's Weekly Watch you'll see that all of those securities made you money at some point in the week, if you were patient. The two that I was most involved in last week were FB and FSLR. I am now out of both of these trades because I feel they are somewhat extended and I can take my profits now and get a better entry later on.
In addition, we saw some great action in AMZN, GOOG, PCLN, EBAY, and XLU just to name a few. At this point AMZN is just a very tough buy, and I have actually been looking at it for a possible short. I will most likely be staying away until there is some type of dip.
For those of us watching the market on Tuesday, the 27th, we saw that GOOG showed relative strength when compared to the SPY's. If you watch the market on a daily basis this was a HUGE indicator for a potential big move. As the rest of the high beta stocks were crushing it two weeks ago, GOOG did not participate one bit. However, we saw a very big difference on the 27th - which eventually led to a 30 point move in the next two days. As day-traders this is the most basic thing we must be aware of - the relative strength in relation to the rest of the market. On the other hand, PCLN had an enormous day that no on expected on 11/28, with decent follow through on the 29th. We are now slightly extended on all of these stocks, so buying at this levels will be tough. But, for the bulls, we are hoping for a down open tomorrow and leading us into buyable levels.
Coming in to tomorrow I am preparing for a big week, however I am not going to front-run this by getting greedy. For instance, in the AAPL chart, I am waiting to buy at the 578-580 area. This is a very low risk/high reward play. If bought at 578, I will use the 11/28 low of 572 as a stop, and be watching the upper range of 594 to trim any gains. This may take a day to develop, but I HIGHLY suggest waiting for your setup, just to confirm any opinions that you have. Remember, your opinions don't mean anything until the market confirms them.
For the last couple months, we have seen the Financials as well as the Homebuilder's leading the market. The XHB index is currently holding higher and has a nice 6-day consolidation. If we can't hold 25.90 (then 25.70) I might become a little weary, but for now let's watch and see how it breaks out of this range. The XLF index, on the other hand, seems to have already pulled in to the moving averages and looks like it wants higher. I'd say this is a buy above 15.90.
Check below for some more charts, and, as always let me know if you have any questions/comments.
SPY 60-minute - at the apex of the broadening formation, watch for a breakout
SPY 15-minute - bulls showing control on Thursday when Boehner spoke
FB - tough to enter at this point, wait for a dip
AAPL 60-minute - buy on the dip!
FSLR 60-minute - needs a breather
LNKD - will be watching VERY closely this week
AXP - inside day on Friday
C - into support, buyable at 34ish with lots of potential upside if the financials participate
BAC - it WILL get through $10, it's just a matter of time. Add this to your portfolio if you are trading on a longer time frame.
NFLX - finally dipped lower, and closed VERY strong on Friday. Will be watching this one very closely as well.
KORS - on our watch list last week for a break out, and we got that on 11/28. Watch for more volume and a move higher
The ET Team
To start, we'll take a look at the futures. S&P futures are slightly higher as of now, up about $1.50 to 1416. We did dip to 1413.15 earler in the evening, but ripped higher quickly. If this is any indication for Monday's open, we could see a gap-up to 1420. This area is pivotal, and could be a gap and go, or a fade. I lean toward the gap and go, but stay on your toes regardless.
The SPX chart is holding in well, but is still slightly extended from its moving averages. What would be ideal, is a low volume sell-off to start the week. Possibly test 1400 and then rip higher. Granted, what the bulls usually want doesn't happen like this. Long story short, as long as we are holding higher than Wednesday's low, I think this bullish trend continues. Setting up a trading plan for all situations is your best bet, you can't be over-prepared.
Now as far as the rest of the market is concerned, there have been SO many great moves last week - it really almost depends on which sector you follow and which stocks you know the best, and you could have made good money. If you check last week's Weekly Watch you'll see that all of those securities made you money at some point in the week, if you were patient. The two that I was most involved in last week were FB and FSLR. I am now out of both of these trades because I feel they are somewhat extended and I can take my profits now and get a better entry later on.
In addition, we saw some great action in AMZN, GOOG, PCLN, EBAY, and XLU just to name a few. At this point AMZN is just a very tough buy, and I have actually been looking at it for a possible short. I will most likely be staying away until there is some type of dip.
For those of us watching the market on Tuesday, the 27th, we saw that GOOG showed relative strength when compared to the SPY's. If you watch the market on a daily basis this was a HUGE indicator for a potential big move. As the rest of the high beta stocks were crushing it two weeks ago, GOOG did not participate one bit. However, we saw a very big difference on the 27th - which eventually led to a 30 point move in the next two days. As day-traders this is the most basic thing we must be aware of - the relative strength in relation to the rest of the market. On the other hand, PCLN had an enormous day that no on expected on 11/28, with decent follow through on the 29th. We are now slightly extended on all of these stocks, so buying at this levels will be tough. But, for the bulls, we are hoping for a down open tomorrow and leading us into buyable levels.
Coming in to tomorrow I am preparing for a big week, however I am not going to front-run this by getting greedy. For instance, in the AAPL chart, I am waiting to buy at the 578-580 area. This is a very low risk/high reward play. If bought at 578, I will use the 11/28 low of 572 as a stop, and be watching the upper range of 594 to trim any gains. This may take a day to develop, but I HIGHLY suggest waiting for your setup, just to confirm any opinions that you have. Remember, your opinions don't mean anything until the market confirms them.
For the last couple months, we have seen the Financials as well as the Homebuilder's leading the market. The XHB index is currently holding higher and has a nice 6-day consolidation. If we can't hold 25.90 (then 25.70) I might become a little weary, but for now let's watch and see how it breaks out of this range. The XLF index, on the other hand, seems to have already pulled in to the moving averages and looks like it wants higher. I'd say this is a buy above 15.90.
Check below for some more charts, and, as always let me know if you have any questions/comments.
SPY 60-minute - at the apex of the broadening formation, watch for a breakout
SPY 15-minute - bulls showing control on Thursday when Boehner spoke
FB - tough to enter at this point, wait for a dip
AAPL 60-minute - buy on the dip!
FSLR 60-minute - needs a breather
LNKD - will be watching VERY closely this week
AXP - inside day on Friday
C - into support, buyable at 34ish with lots of potential upside if the financials participate
BAC - it WILL get through $10, it's just a matter of time. Add this to your portfolio if you are trading on a longer time frame.
NFLX - finally dipped lower, and closed VERY strong on Friday. Will be watching this one very closely as well.
KORS - on our watch list last week for a break out, and we got that on 11/28. Watch for more volume and a move higher
The ET Team