After last Thursday's futures sell-off during the pre-market, the market has held up very well as the bulls maintain control. However, futures are currently testing the 1416 level during the Sunday session. If 1416 can't hold coming into Monday morning, the SPY's will be testing the 50-day. The last thing we want is profit taking headed into the new year, and I will be slightly worried if we see a sell-off on the shortened session Monday.
After reviewing the charts in the S&P 500, I have noticed that a majority of stocks that opened lower on Friday rebounded much higher and closing as doji candles on the day. It is obvious the market is hanging on by a thread awaiting for Fiscal Cliff news, and trading has become a very very difficult task these last few days. Coming into Monday it's IMPERATIVE on being extremely prudent and having defined stops. Holding overnight for the next two weeks is not suggested, as anything could happen between sessions.
There are a few setups that I'll be watching on the open Monday. One thing, and most obviously, is that the XLF's and XHB's are proving to be market leaders. Watch how these two hold up this week, if they fail then we are in for a long end of the year.
Other than watching the overall price action off the bat on Monday, there are a few sectors/stocks that do look like they may prove themselves this week:
IYT - Transports have been waiting for a breakout, keep an eye on this sector.
FAS - Financials have been amazing, BUY THE DIPS! (I still REALLY REALLY want this at 116)
BA - Defense is on the chopping block for Fiscal Cliff cuts, watch to see if it can hold up.
BSX - Closed well on Friday into resistance, flagging higher.
ISRG - Recovered well on Friday, big potential moves both directions.
USB - Flagging higher, holding 32.
HES - Flagging higher, watch for a move to 56.
NBL - Noble is at a very interesting spot here. 3rd time is typically a charm (monthly chart), so let's see if we can get a move through resistance (103-105).
APOL - I think a move to 116 is in the cards if it holds up in a down market
KSU - At highs, watch for a breakout
SIAL - Major resistance at 74-75, watch for a move through this area.
After reviewing the charts in the S&P 500, I have noticed that a majority of stocks that opened lower on Friday rebounded much higher and closing as doji candles on the day. It is obvious the market is hanging on by a thread awaiting for Fiscal Cliff news, and trading has become a very very difficult task these last few days. Coming into Monday it's IMPERATIVE on being extremely prudent and having defined stops. Holding overnight for the next two weeks is not suggested, as anything could happen between sessions.
There are a few setups that I'll be watching on the open Monday. One thing, and most obviously, is that the XLF's and XHB's are proving to be market leaders. Watch how these two hold up this week, if they fail then we are in for a long end of the year.
Other than watching the overall price action off the bat on Monday, there are a few sectors/stocks that do look like they may prove themselves this week:
IYT - Transports have been waiting for a breakout, keep an eye on this sector.
FAS - Financials have been amazing, BUY THE DIPS! (I still REALLY REALLY want this at 116)
BA - Defense is on the chopping block for Fiscal Cliff cuts, watch to see if it can hold up.
BSX - Closed well on Friday into resistance, flagging higher.
ISRG - Recovered well on Friday, big potential moves both directions.
USB - Flagging higher, holding 32.
HES - Flagging higher, watch for a move to 56.
NBL - Noble is at a very interesting spot here. 3rd time is typically a charm (monthly chart), so let's see if we can get a move through resistance (103-105).
APOL - I think a move to 116 is in the cards if it holds up in a down market
KSU - At highs, watch for a breakout
SIAL - Major resistance at 74-75, watch for a move through this area.