TradingMarkets.com
What I Saw Today: Bullish Gap, Intraday 'Bull'
Friday March 12, 6:12 pm ET
By Chris Tyler
What do you get when you throw together an oversold market that gaps higher and then consolidates in a narrow trading range for two-thirds of the session? Well speaking personally, I'd rather take more oversold, because even though it was nice to see the Nasdaq Composite and S&P 500 rally--the intraday trading in this cautious bull's opinion was treacherous at best. Kind of ironic how the market's opening gap--much of it placed on Oracle's glowing earnings report--was able to hold itself together, while Larry & Co. finished at fresh Year-To-Date lows. Do you think the Oracle saw it coming? On the day, the major averages did end up between 1.25% to 2.10, while finishing near their best levels. The bad news for you IBD'ers out there, is the fact that volume was much lighter and below-average. Hmm, funny how this scares the same people that were so enthusiastic about January's institutional accumulation. Oh well, you don't have to agree with me on today's action, but hopefully we can all agree on the fact that T.G.I.F. is finally here.
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As mentioned, today was not my best. Gaps of this nature coupled with consolidations make my style of trading very easy targets for getting stopped out. There was enough volatility in individual issues to knock out the usual .15 to .35 stops quite consistently. The semiconductor sector (SMH) has triggered on the intraday charts during the past two sessions as a reversal long, after testing the very, very top of a support zone between 38 -38.80, but the sloppy nature of the intraday charts has made it difficult to maintain any longs in the realm of my intraday universe. The position players are probably faring a little bit better at this point with their own reversal longs as stop loss management is given greater leeway. Oh well, that's OK by me-- because this cautious bull still knows that over the long haul, disciplined, consistent daytrading tactics is the best way to play the greatest show on earth.
Volatility Readings:
Volatility Index Close Net Change Signals/Direction % Above/Below 10 Day Moving Average Significance
VXO (CBOE:^VXO - News) 18.72 down 2.99 cvr 2,3,6 buy 14% above at extreme
VXN (CBOE:^VXN - News) 25.23 down 1.35 cvn 2,6 buy 6% above not at extreme
Hottest Sectors : Semiconductor (AMEX:SMH - News)
Weakest Sectors : Gold/Silver (XAU)
Monday's stocks to watch:
Technical Strength Top of Range. Stocks are scanned from TM's Proprietary and Technology 10 Momentum lists on the Indicators page, as well as being hand selected, based on the most recent technical action. This may include some or all of the following: abnormal volume, price patterns, as well as bullish action off of technical price supports or clearance of technical resistance in that day's session.
Name Symbol Price Technical Strength Average Volume 000's Today's Volume
Integra Lifesciences (NasdaqNM:IART - News) 32.25 Extended 60-minute chart lateral consolidation above key MAs 234 117
Serologicals (NasdaqNM:SERO - News) 20.67 High of day close, holding daily b/o pivots on pullback 508 529
Technical Weakness Bottom of Range. Stocks are scanned from TM's Implosion and Technology Implosion Lists on the Indicators page, as well as being hand selected, based on the most recent technical action. This may include some or all of the following: abnormal volume, price patterns, as well as bearish technical action at key support, or resistance levels based on closing prices.
Name Symbol Price Technical Strength Average Volume 000's Today's Volume
Royal Caribbean (NYSE:RCL - News) 42.20 Bottom of range consolidation on above average trade 1,436 1,668
Nordstroms (NYSE:JWN - News) 38.70 Pullback from daily lows into resistance zone 1,205 924
Stock Reversal Setups Closing Basis. Stocks that are setting up on a closing basis as potential long or short reversal pattern candidates. Candidates listed may have triggered on a closing basis, or close to triggering ( my general rule is to list the pattern setup if it is within +/-.15 of trigger price). Patterns include basing patterns (Slim Jims, 1,2,3s, Double bottoms) consolidations, and triangle reversals. Background technical supports in the form of Fibonacci levels, EMAs (DEMA=daily ema), RS, and former price action are used in the decision making process.
Long Reversals Closing Basis. Name Symbol Price Technical Strength Average Volume 000's Today's Volume
Chinadotcom (NasdaqNM:CHINA - News) 8.93 High volume test of daily technical support zone 5,117 8,184
Semiconductor HOLDRs 39.62 Inside day on above average volume, holding daily chart support zone 13,479 21,337
Short Reversals Closing Basis. Name Symbol Price Technical Strength Average Volume 000's Today's Volume
NA NA NA NA NA NA
Institutional Favorites and Institutional Laggards. The following stocks are selected from the Nasdaq, S&P 500 & 600 Indices, and HOLDRs. These are normally heavily traded, liquid issues that are exhibiting relative strength or weakness, patterns (consolidations or Slim Jims) , or last hour volume surges, indicative of follow through in the very near term.
Institutional Favorites Name Symbol Price Average Volume 000's Today's Volume
Juniper (NasdaqNM:JNPR - News) 25.81 16,077 14,741
Adobe (NasdaqNM:ADBE - News) 35.71 3,432 3,301
Institutional Laggards. Name Symbol Price Average Volume 000's Today's Volume
Oracle (NasdaqNM:ORCL - News) 12.06 42,212 109,831
Johnson & Johnson (NYSE:JNJ - News) 50.71 7,691 10,039
Best of luck to everyone. Please use protective stops on all trades.
P.S. You can find more analysis from me at www.tradingmarkets.com.
Chris Tyler |
