Thursday, April 7, 2005
Issue Contents:
| 09:14 | Swing Trade Setups Featured charts for Thursday April 7th |
| 09:34 | The Day Ahead Economic releases and news |
| 16:15 | TrendVue Trader Talk Today's transcript. |
| 17:34 | Swing Scanner Results Thursday April 7th closing data |
| 17:35 | Market Statistics For Thursday April 7, 2005 |
| 19:43 | Swing Trade Setups Featured charts for Friday April 8th |
Featured setups from Wednesday April 6, 2005 closing data symbol scan
Jump to: Long Setups | Short Setups | Special Situations
Notes for the Day
My apologies for the late posting – yesterday Murphy hit us bad, keeping the site down for hours while the data center messed about (nothing serious in the end), and to top it all off, I had a thoroughly unsatisfying dentist appointment and have to go back, again, on Monday.
After almost two weeks of sideways chop, we started to get a sense yesterday that the buyers are giving up supporting this market. Too many trips to the range high without any real attempt to break higher will eventually wear out the hardiest of bulls.
I’ll still keep an open mind on the long side but as noted the other day, I’ve been tightening up stops on all my longs and letting profit stops take me out slowly but surely. This may mean I have to get long in a hurry if some well of buying power is found – ETFs are ideal for this.
Long Setups
General common strategy: Unless noted otherwise, buy stop just above the “high” value, with an initial protective stop at the low value of the bar, not below the bar.
Retracement or Pause in Up Swing / Up Trend
XOM is one of the few oils which did not scream totally higher last few days – a chance to add.
TTWO – software, games – goal is to revisit Dec 2003 highs, but also note that a failed test of top is so far in place on the weekly chart so if filled here, only hold if/while it remains strong. The weekly chart has not pulled back so far as to make this an untenable long trade in the big picture.
Test of Top – Continuation
Short Setups
General common strategy: Unless noted otherwise, place a sell alert at or just below the low of the setup bar, and look for the first failed intraday bounce after the low has been broken. What we are looking for is price to push down, bounce a little, and fail again – this is where we want to get short.
Retracement or Pause in Down Swing / Down Trend
QQQQ
SPY – S&P 500 ETF
GIS – food stuffs, bear flag bounce to overhead resistance
AON – insurance, lately hard hit. This can also be stalked as a long using the 3 Inside Up setup present here – my inclination is to pass on the longs and take the short if it works. There must be better long charts out there than this one…
Test of Bottom – Continuation
PMCS – semis
Special Situations
ATML – step in the manhole, inside bar to set alerts above. Aggressive, intraday-capable traders only.
Good morning, its Thursday April 7th, the 97th day of 2005.
The Bank of England and the European Central Bank both held interest rates – for the 8th straight month in the case of the BOE and the 22nd straight month for the ECB.
We’ve been waiting for this expected announcement to see if the US Dollar got any lift today – so far, no, and the US Dollar Index trades down 1/3 of a percent at this writing. Golds may continue their minor move up today yet the sector is likely to be pushed around by any strong or weak economic news now that competition from other major currencies is off the table for another month if not longer.
Reports from Walmart signalling further weakness in that sector and persistently high jobless claims week in week out seem to be weighing on the greenback today.
US Market Calendar
- 7:00 am: BOE Announcement1
- 7:45 am: ECB Announcement2
- 8:30 am: Initial Claims – Apr. 2nd week3
- 10:00 am: Wholesale Trade – Feb.
- 10:00 am: Treasury Secretary John Snow to testify on reforming the government sponsored enterprises to the Senate Banking Committee in Washington.
- 11:00 am: Chain Store Sales
- 12:30 pm: Philadelphia Federal Reserve Bank President Anthony Santomero to speak to the National Economists Club.
- 3:00 pm: Consumer Credit – Feb.
Canadian Market Calendar
- 8:30 am: Building Permits – Feb.
- 10:00 am: Ivey Purchasing Managers’ Index – Mar.
Earnings and the Federal Reserve
For earnings highlights, please see today's WSJ Earnings Calendar.
For a list of upcoming speeches, congressional testimony, Federal Open Market Committee material, and statistical releases, please visit the What's Next page of The Federal Reserve Board website. Recently released Federal Reserve Board material, including market moving FOMC decisions and speeches by members, will be found on their What's New page.
1 BoE holds rates at 4.75 percent
2 ECB holds rates at 2% as eurozone gloom deepens
3 U.S. Initial Jobless Claims Fell by 19,000 Last Week to 334,000
Today's transcript.
Click on the title above to expand this document.
Thursday April 7th closing data
Click on the title above to expand this document.
Statistics for Thursday April 7, 2005
Note: Statistics are compiled based on our custom symbol universe of the most heavily traded stocks.
| Symbols in Up Swings | 460 |
|---|---|
| Symbols in Down Swings | 293 |
| Up/Down Swing Ratio | 1.56 : 1 |
| Advancers | 70% |
| Decliners | 28% |
| Unchanged | 2% |
| Up Bars | 39% |
| Down Bars | 30% |
| Inside Bars | 13% |
| Outside Bars | 13% |
| Close > 20EMA | 70% |
| Close > 50SMA | 43% |
| Close > 200SMA | 58% |
| 20EMA > 50SMA > 200SMA (trend up) | 30% |
| 20EMA < 50SMA < 200SMA (trend down) | 30% |
Featured setups from Thursday April 7, 2005 closing data symbol scan
Jump to: Long Setups | Short Setups | Special Situations
Notes for the Day
Price managed to stay above the key dividing line discussed – so for the time being we’ll assume direction is up. I remain concerned over weakness in banking sector in both US and Canada (big sell off today in many Canadian names) and the very timid price action given price had broken out above resistance intraday.
Lets see what overnight news brings – check the web site for any additional featured charts in the morning.
Note: See also Sector Focus – Electric Utilities – at bottom of today’s listing.
Long Setups
General common strategy: Unless noted otherwise, buy stop just above the “high” value, with an initial protective stop at the low value of the bar, not below the bar.
Test of Bottom – Reversal
AMTD – first retracement following a test of bottom. Get to break even stop fairly quickly once filled – the two day high should be easily cleared if its going to work.
Retracement or Pause in Up Swing / Up Trend
EMC we discussed in Trader Talk, has characteristics of selling exhaustion in March – trigger at 2 day high.
Short Setups
General common strategy: Unless noted otherwise, place a sell alert at or just below the low of the setup bar, and look for the first failed intraday bounce after the low has been broken. What we are looking for is price to push down, bounce a little, and fail again – this is where we want to get short.
Test of Top – Reversal
HAL – oil services, dark cloud cover. Even if one doesn’t care to short the amazingly strong energy sector, at the very least this can serve as a caution. Despite being a ‘bearish’ formation, bear in mind its still by definition an “up” bar. Unless a retracement into the range below gets too deep for HAL and oil services (RIG, etc) we may be stalking these long soon enough. You’ll note a number of oil / oil service related names in the dark cloud cover scan results today:
Retracement or Pause in Down Swing / Down Trend
Banking / Finance Sector, bounces to overhead resistance
MER – finance
BAC – banking – this is a fairly complex trade setup more akin to the Grail Sell than our typical 2–4 bar retracement. Three doji/spike days in a row bouncing to overhead resistance suggests its worthwhile stalking here now, hold only if short closes weak and profitable.
KEY – banking. Stealth bear flag within range on both daily and weekly charts.
AMAT, hanging on by a thread
Special Situations
Today a collection of charts that may be bottoming out here. Higher risk, potentially longer term holds if filled and profitable. Personally I don’t hold anything at a loss beyond my initial stop, ever. Even a longer term prospect is still, in the early days, merely a trade for me.
FLEX – long – tied to NT, watch both. Fills gap left by small gap up two days ago.
QLTI – long – also on TSX QLT:C had a fair chunk of volume yesterday but little price moment – caution or opportunity only time will tell.
A:C (ABY on NYSE) – A:C and DTC Domtar have been dogs for some time – following a test of bottom here’s the first retracement. I have low expectations for this but will be stalking a long regardless. Just look at Alcoa and Alcan for examples of what can be missed on a test of bottom (sadly I removed Alcan from my watch list a few weeks ago!).
Sector Focus – Electric Utilities
Lost among the shouting in oil and gas have been electric utilities. Lets have a look.
ILA – electric utilities – I’ve noted a number of electric utils moving up recently, bouncing no doubt following some sense that rate increases may not rise as rapidly as first feared following the recent FOMC meeting. Just the same all interest sensitive stocks including utilities will be under pressure on any strong economic news, so caution required. ILA has been slowly creeping off the bottom for months now and is probably worth stalking now and in the future for other opportunities.
AES – electric utilities – not a beaten up name, provided here for comparison, and offers a ledge to stalk for a long as well.
TA – (also TAC on NYSE) electric utilities.