Today was a good day in the market for the major indexes as the $INDU (DIA), $SPX (S&P 500) broke out to new highs. The $COMPQ (NASDAQ) rallied, as well as the $RUT & $WLSH indexes.  This means that the major markets shook off the sell off last week and look to continue their march higher.  This comes at the expense of the commodities, as the commodities index ($DBC), Gold ($GLD), oil ($USO), and even bonds ($TNX) stay at or near all time lows.  With the main stock markets bullish these “safer” bets will stay beaten down. Where is the money going?  It is going into everywhere but Basic Materials (highlighted by the falling commodities prices).  This is good in that rising water float all boats, and its bad because its hard to focus on one trend to profit. Case in point; although technology was good today, thanks to the strength of $GOOGL, $FB, $MSFT, etc. Over the last month technology has been near the bottom.  Also, keep an eye on biotechs, they are strong, as the $IBB approaches new 52H.

(Ref the picture, some companies may not be were you expect them like $AAPL is consumer goods, and $AMZN is services, etc.)

The good news from these rising tides is that the sector losers should be tanking hard with so many other good options, traders may be “jumping ship” from the sinking ships to the rising ships. However, use caution and take profits early because a rising market does raise all stocks.  On the flip side, with only one major sector down, shorting the turds of that sector should be extra profitable as no trader or investor wants to be losing money when EVERYONE else is making money, i.e. why risk timing the bottom of a stock when the runners keep running. Remember, the trend is your friend. 

 

 

$CLDR, Short<17.40 (previous days high) Back testing IPO price, looking pretty weak here. Not normally my short, with it $2 above the low. However, it has tested and failed the IPO price of 17.80. The candlestick is a hanging man, which means, if it gaps down all those who bought today expecting the breakout will be rethinking their buy and all those holding from the IPO hoping for the bounce. Just as major vol came in when it fell below the IPO price, volume could come in & it could fall back to $16.  This is a critical day.

 

$ETP, Short <19. This remains a nice steady winner. As I said last week; “the heavy downtrend continues and with oil prices dropping big, this dropped. As I said Monday, this could easily go below $20.”  it continues to make new 52wL, having pierced mid $19s SUP and now testing $19 this is a major milestone not seen since 2012 (not counting the 2016 Jan panic). Volume is lower and we have a spinning candle that is slightly green, a push below $19 could cause another panic like early June when $22 fell. 

 

$ENZ, Long >$11, broke out of the ascending triangle trading near the $11 level. Watch for b/o >$11 with vol. It hasn’t seen this level since 2008. 41.8M float with 2.5 Days short ratio. With an ATR of 41c,and avg vol of 280k, would need more volume to really breakout strong. When it went from low (’s to mid 10’s it had more then doubled the vol. 

 

$NK: Long >7.12. Had a sell off in the morning that made me take my eyes off it and then it took off. Finished strong. Looking for it to continue with $8 then $10. 30M float and 8.4 days short ratio. With Biotechs strong ($IBB) approaching new 52H this could continue. 

 

$OMER: Long >25.10. Some massive moves, from $15 to $25, no red days. Looking for it to consolidate around here. POSS move to $30 if it does push through 25.10. Has 41M float, and 10.3 days short ratio.  With Biotechs strong ($IBB) approaching new 52H this is one to keep an eye on. 

 

$RMP: Short <16.90. down over 30% at one point. With this sector already down trending this could easily fail and drop some more. Prev low was 18.05. 73M float. ATR@1.11. aVol@475k, short ratio of 6.80 days. 

 

$SORL; Short below $5.98, the 50MA. The real move was the break below $7 yesterday. With this sector overall down trending, this could have follow on movement and a break of the 50MA would be a major negative.