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SPY managed to grind to new highs last week testing the 108.20 upper daily trendline. The daily stochastic crossed up so a pup breakout towards the upper bbs at 209.96 is in the cards unless bears can take out the daily 5 and 15 period moving averages at 207.28 and 206.48 respectively. The daily 5 period ma will likely test at some point and if it bounces off or back up through the 207.70 level then the daily stochastic can also wind up for a mini pup thereby increasingly the probability of upper bbs being hit. The volume is very light and continuing to thin out as we head closer to the holidays as the algos take more control with the declining in participants into year end.
Key daily SPY fibs/bumpers this week: 213.24, 209.97 (daily upper bbs), 207.28 (stinky 2.50s levels and highs), 204.83, 201.98, 201.24, 198.15. What appears to be the resolution of last week’s make or break should be a pup breakout with the stochastics crossed up but the bulls don’t appear overly eager to chase here without some kind of catalyst. Same story all year, bulls buy the dips forcing the bears to cover the rips.
<> Stocks to Watch <> : A lot of these are contingent on the SPY. If SPY forms daily mini inv pups, then SCRATCH the LONGS or cut down to shorter time frames. To be safe, make sure that the 60 min stochastics peaks out before taking short positions and short the RETEST FAILURES of the short area bumpers listed. DO NOT SHORT RIGHT INTO THE FIRST TEST if the 60 min is in a mini pup grind up. Get the 15/5 min to slip and 60 min to STALL at least on the stochastics and then position with a good 1 min stochs reversal down. Remember all stocks are anchored by the action of the SPY (or noodles) and contingent on the SPY movement unless there is a strong fade effect in place. * Don’t play breakout longs if the SPY is in a breakdown and vice versa *
*** Most stocks are mirroring the SPY intraday as well as daily. Therefore, track the SPY closely. Make note if your stocks are diverging or not as this could mean it’s a laggard that will ultimately revert to SPY or a fader that will magnify the move once the SPY reverses.
T Long – T testing the lower trendline. 32.70 is the super fib support level. 33.41 is the daily lower bbs. Longs trigger on a slip to 32.70s-32.50s with a 31.98 trail stop for a coil back to the 33.70s-34.30.
JNPR Long/Short– JNPR has a similar breakout on the daily pup with 23.21 upper bbs. Longs trigger on pullbacks to daily 5 period ma at 22.16-22.03 for a daily towards monthly 15pd ma and daily upper bbs at 23.20. Shorts trigger in the 23.30-23.45 range for reversions back to the 21.83 daily 15 period ma if upper targets are hit, both with a - .37 trail.
Key Long/Short Bumper and Fibonacci levels:
SPY – 212.67, 209.74, 207.86, 204.90, 204.24, 203.50
FSLR – 51.74, 42.84 fibs
GPRO- 90.48, 83.50, 71.78, 63.54 -key fibs
BABA – 115.17, 111.09, 108.21, 103.24, 99.70, 98.21, 96.90. 94.70, 93.1591.61, 89.40, 88.10 – key fibs
YHOO- 47.68, 45.82, 44.59, 42.05, 41.01, 40.10, 38.57, 37.50, 36.42 – key fibs
AAPL- 111.32, 109.39, 107.17, 104.59, 103.17, 101.92, 101.04, 99.29, 98.69, 98.08- key fibs.
FB- 80.60, 78.66, 77.57, 76.72, 7636, 75,.53, 7512, 74.78, 73.97, 72.78 – key fibs
TWTR- 51.19, 50.51, 48.82, 47.95, 47.63, 45.38 – key fibs
Earnings Reports This Week:
Mon: postmarket: PLAB, HRB, DMND, PBY
Tues: premarket: CONN, PTRY, BURL, SAIC, AZO: postmarket: CENT, HELI, KKD, ALOG
Wed: premarket: TOL, HOV, FRAN, LAYN, TITN, VRA, COST: postmarket: AVNW, CASY, SIGM, WTSL, SMTL, SURG, MW, PPHM
Thurs: premarket: CIEN, MEI, LULU, RSH: postmarket: NDSN, DDC,ESL, ADBE
Daily SPY has set up a pup breakout as it is right at a tipping point. This market doesn’t make it easy so a sharp pullback then a spike off the daily 5 period ma 107.28 is a possibility as the stochastic testing the 80 band. Allocate lightly this week as dimishing volume and liquidity is expected to continue. - J