Market Read & Weekly Watchlist 041811-042211

SPY- I spy an Inv H&S "The Captain Obvious" setup forming here on the daily. Talked about this likely development in last blog entry http://blackmarkt-trader.blogspot.com/2011/04/weekly-swing-watchlist-041111-041511.html.We shall see if this pattern follows through with all the event headline risks coming to the fore from earnings, Washington's budget showdown, crude showing no slowing down, housing rolling back over & finnies confirming this trend, GDP downward revisions, the end of US QE, etc...

If we can't clear 132.4'ish (23.6% Fib) & break out of the box think we chop around in this range a lil more. If we clear probably going to retest 133 & then above that 134.

QQQ

RUT- Starting to look like yet another higher low and continuing to act as a bullish leading market indicator.

USDX/Dollar (DX_F)- The Carry trade continues as crude, gold, silver, other commodities remain strong. Coming up on 74.40;ish lows from Dec 2010. Will probably test that this week. Think we see a bounce there.

VIX: Back in the basement.

McClellan Oscillator- No real edge here.

Absolute Breadth- Stockpicker's market.

Crude (CL_F)- Spectacular summer weather hit this weekend in SoCal and seeing more cars on the road headed for the beach or just moving around. Seasonality now beginning to drive crude higher. Don't expect Libya to resolve anytime soon as NATO leaders have formally announced that it's do or die Gaddafi.

Crude VIX- Crude "No Fear" HT @stevenplace

Copper (HG_F)- Probably due to China's recent PMI report and investors anticipating continued tightening to cool inflation.
http://online.wsj.com/article/SB10001424052748703712504576235612939920034.html?mod=googlenews_wsj

Weekly Watchlist
*Earnings season is upon us so be sure to check announcement dates & other sector related names for their dates.

AAPL- Sitting on long-term TL. All indicators in the basement of oversold for this market leader. Reports 4/20/11 A/H.

SWKS- Watch for a reaction from SWKS once AAPL announces. If its positive this stock could really bounce off this 26 support. Targets on the chart are fib ret & TL res. Looking for 30. Reports 4/28/11 A/H.

APKT- Recycled name from previous weekly watchlist. Still setting up Tight consolidation. My May bull call spread still working. Reports 4/26/11 A/H.

JDSU- Looks like its basing above 18. 20MA and TL (see the 30min chart) are resistance. Trigger is around 19 with a stop if it loses 18. Looking for a move to at least 22 (38.2% Fib Ret) which is also gap resistance or TL. Reports 5/5/11 A/H.

GOOG- Knife catch here. There's a long-term ascending triangle TL support line coming up soon around 520 & then 510 is a support level. Already reported on Friday 04/15/11.

AEM- Similar to JDSU looking for this 64 level to hold and get a bounce. 20MA is res & then you have TL. Would like to see it spin sideways and build a base. Reports 4/28/11 P/M

VRTX- Nice pennant/wedge forming on the daily, BB pinching, top of watchlist. Reports 5/3/11 A/H

CRR- Nice push off the 50MA on Friday, like to try to get in this on a dip to 128.5 if it comes that low. Stoch cross, Stoch RSI & RSI all beginning to turn up. Reports 4/28/11 P/M

UA- Nice pennant/wedge forming on the daily, 75 is my trigger with maybe a 1pt stop looking for 80+ first target. Reports 4/26/11 P/M

MGM- This casino has 14.5 written all over it if can clear 14 on volume. Stoch, MACD and RSI support higher prices. A clearance above 14 has less congestion. Going to have to wait until after WYNN reports on Tuesday 04/19/11. Looks like they're jamming WYNN to all-time highs into earnings. MGM reports 5/5/11 P/M

BTU- Support bounce play here off the 100MA & TL sup. Reports 4/19/11 P/M. Will wait until after earnings to see which way it break either that's a bear flag or a base setting up. 

CAT- Support bounce off the 50MA. Would like to see it base down here for a few more days between this short-term 106-108. Looking for a dip back to 107-106.5 with a stop just below 106 looking for at least 110+. Reports 4/29/11 P/M.

FOSL- Breakout play here with nice range consolidation at the highs. Looks like 95 is resistance with 91 bottom of the range support. Think if this goes see the 100 roll soon. Certain retail names have continued to show strength. Reports 5/10/11 P/M. 

Weekly Swing Watchlist 041111-041511

SPY: Play the range until we break out or down. If we break down still watching for possible inv H&S on the daily (130 & 131) which also coincide with Fib levels

possible Inv H&S on daily:

QQQ or NDX-X: We see a possible inv H&S forming on the daily on both the triple Q's or the Nasdaq 100:

IWM: Small cap stocks are rolling over and we could see a pullback to breakout setup forming here. MACD, Stoch, OBV, RSI, last 2 days volume, etc... are all pointing to a dip.

USDX: The dollar still looks weak and likely to retest Dec 09 lows around 74.23.

CL_F: What can you say? Bullish but...

As @stevenplace pointed out that we did an accompany spike in the crude vix as it looks like crude longs are now wanting protection into this strong upmove.

HG_F: Copper futures broke out of pennant/wedge and closed above 4.5. China is now looking stronger as well as EEM's. Dollar weakness contributing to carry trade continuation.

Weekly Watchlist

JDSU: Still watching for a 18 bounce or if we get above the 20MA and hold may look at a long with 19 as the stop. Still looks vulnerable but could be basing and through time could be ready for a bounce.

CSTR: Stalking for that gap fill. Entries are above Friday's high 49.36 on volume or around 47.5-46.5 (P/B to B/O) above that consolidation range. Already into thinner air or the "vacuum". May also look at a May 50/55 call spread.

APKT: Was on my weekly watchlist 2 weeks ago. Booked a double on my April call spreads looking for a reload here clear stops under 20/50MA. MACD still looks bullish, volatility pinching, looks like a nice launchpad. Right here right now looking stops out if it loses 69 or 50MA: VERTICAL APKT 100 MAY 11 77.5/80 CALL @.80 LMT. Has earnings on 4/16/11 AH.

TOS Analytics:

FNSR: Nice rounded base, flagging out, would ideally like to see it consolidate and see accumulation below the 27.19 gap fill B/O level. 

TCK: Flagging out in-between 50 & 61.8% Fib Retracement levels. Would like to see a dip to the 20MA to get involved with a target to 63.

RAX: All eyes on RAX probably the best looking setup coming into this week. Hasn't flinched during the choppy range action in the markets. Like this on a volume break above 43.5 & then above 44.19 with stops just under the consolidation range around 42. I like the VERTICAL RAX 100 MAY 11 46/47 CALL @.30 LMT. Probably a fire & forget options trade.

Josh Brown @thereformedbrokers take on RAX:

TOS Analytics:

CHK: Chart says it all. I'm in it to win it.

TRLG: Would like to see it flag out and consolidate. Watching

SGG: Support bounce play here. Watching to see if Sugar holds 25 (see futures chart below)

AAPL & GS for moves into earnings season

AAPL: reports on 4/20/11 AH. Has run into earnings for the last 2 yrs

GS: reports 4/19/11 PM. Also has a pattern of running into earnings

Trend Down Days are my Achilles Heal

If there are days when I get consistently beat up they are trend down days. Every single time without fail I am unable to recognize this pattern intraday and fight it every step of the way. With every single bought dip I think this is it this is the bottom which usually works on inside or range-bound days but not trend downs. These kinds of days usually catch me by surprise in an strong uptrending market because they are unexpected having been put to the back of my mind.

So one big question I wrestle with is: Why am I unable to recognize this pattern during the day?

The most painful occurrences come on Fridays and ruin my weekends manifesting in loss of sleep, nightmares repeating the bad trades and make me hesitant to do my weekly review and homework for the upcoming week.

So I've spent yet another weekend thinking how do I prevent myself from getting caught again  and end the vicious cycle:

- Trade only "In Play" stocks: As SMB states stocks with fresh news typically trade independent of what the overall market is doing.

- Make my trading bias more flexible: I am bipolar when it comes to trading. I am usually hot or cold. I have a hard time switching back or forth.

- Enforce daily max pain thresholds: I have risk management built into my Lightspeed day trading account but I am going to enforce this in my IBKR accounts. I could always reset this but at least the break would force me to step back, breath and re-approach the market.

- Trade less on Fridays: I usually follow this rule but not with great consistency. So I may employ a rule to drastically cut my tier size on Fridays and under a certain amount of shares. This goes double on Opex Fridays.

- Trend checks throughout the day: Every day at 11AM I write down what I think the overall trend is in the market. Maybe I need to do this throughout the day maybe every hour or every 2 hours.

- Put the AAPL crack pipe down :-)

SPY

AAPL

Weekly Swing Watchlist 040311-040811

Didn't find a ton of good setups this weekend. Don't think trading will be nearly as good as last week's watchlist http://blackmarkt-trader.blogspot.com/2011_03_01_archive.html

SPY-  My bias is that we don't make it through 1338 and hold. Instead I think we fail and pullback to around 1310 or 1300 to form the right shoulder of the inv H&S. But must be prepared for anything especially bull traps.

Copper (JJC)- Copper in a down channel. RSI, MACD, & Stoch RSI are all turning down. Again copper is lacking the overall market but has been a fairly good leading market tell. But as Steven Place at IWO stated this could do with China and the continuing issue of rising interest rates to cool inflation.

Crude (CL_F)- WTI broke out on Friday but gas prices don't matter to the US economy until they do.

Dollar (DXY0)- On Friday after a positive jobs report the dollar was strongly rejected from 23.6% fib retracement level. Let's see if it can hold here and start making a higher low and possible uptrend. Lots of QE forever, Yen intervention, Europe insolvency crosscurrents.

McClellan Oscillator (T2106)- Good breadth during this rally but getting close to +200 level. Not a primary or even secondary trading indicator but just something that's cautioning me to go heavy long after this move.

Watchlist

SHAW- short idea looking for a retest of 36 with a 30-50c stop looking for a quick failure from that level & the 20MA. Downside targets are 32-34.

KEX- trannie still setting up for a B/O. trigger is 57.4 with a 50c stop looking for at least 60.

DECK- Like trying to get into this one on a P/B to 20/50MA convergence around 84 with a stop just under that trying to catch a P/B to B/O setup. Looking for top of channel or possibly 100. Also setting a 2nd alert above Fri's high 88.28 looking for volume confirmation if it does go.

CHRW- Like this on a clean break above 100MA or Fri's hi 75.37 with a stop below Fri's low or 1pt trying to catch a run to 80. Not my fav setup but looks like it has put in a bottom & now above that base.

GES- Like the gap fill play here on a break w/ volume of Fri's hi/20MA 40.8 may take some for a swing with a stop under Fri's low 39.69 looking for possible 48-50 retest. TA analysis: bullish MACD cross, Stoch turning up, RSI trying to put in a bottom

ASH- Looks poised for a move out of wedge & BB pinch to pop. Bullish volume, MACD convergence, RSI Stoch is tightening. Not the cleanest chart but may take a feeler above 58.5 with a stop under the 20/50MA's under 57 looking for a move above the recent high 62+ or top of channel.

RIMM- Relatively weak tech play here. If market can't get above 1338 & we make our way down & tech continues to lag like this short if it loses 55.77 with a 30c stop looking for 1+pts.