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FOR THIS WEEK'S POSITION TRADE NEWSLETTER
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Daily
Editorial: |
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Friday's Decline Deters Strong Intraday
Trends on Monday
Good morning! After
last Friday's speedy plunge, the new week got off to a slow start on
Monday. Many bulls were too scared to jump right back into the thick of
things, while the bears didn't appear too certain as to just how much
further south it could go without at least correcting on the 15 minute
charts. This quagmire left the market to open near Friday's closing
prices and landed the indices right smack in the middle of a trading
range on the 5 and 15 minute charts that would persist throughout the
day.
The NASDAQ showed a little more relative
weakness in the morning than the S&P500 and Dow Jones Ind. Ave. A
rapid bout of selling in that index out of the 9:45 ET reversal period
led to a break in Friday's lows, while the other two held them. After
just 15 minutes the situation began to turn around. The indices bounced
back into the 5 minute 20 sma intraday, fell into triangle on the 5
minute charts and pushed slowly higher out of that triangle soon after
the 11:00 ET reversal period.
The steady but gradual upside into noon came
to a halt going into the 12:00 ET reversal period. This is a typical
time for mid-day pivots to occur and it held very well this time
around. The market had managed to make it back up into the middle of
that mid-afternoon range from Friday, which served as resistance, but a
lack of significant volume and momentum helped it stall and hold at
those levels. The reaction to the resistance was rapid and the indices
quickly fell past the 5 and 15 minute 20 sma with scarcely a second
glance.
As the day continued, the indices remained stuck in the range
established by the morning trading activity. Volume continued to
decline into the afternoon as the range narrowed. They ended the day
rather close the middle of the 15 minute range. The somewhat rounded
lows made on the 15 minute charts bring with them concerns from the
bears that the market will round off and turn back higher into Tuesday.
The pace without the range does not yet favor that, because the
downward moves within the range were slowing down.
Intraday along the charts look lower. They are forming nice triangle
patterns on the 15 minute chart. The rounded lows will also harbor
bulls who got trapped buying new lows and are just holding on. Pace can
also be in issue in terms of the reward for any breakdown, because it
increases the risk that the market will set a trap upon breaking the
trend channel of the triangle only to reverse and head the opposite
direction. I'll be keeping these things in the forefront of my mind
heading into Tuesday.
Note: As this earnings season progresses, be sure to pay closer
attention to when earnings are due for any open positions you may have.
While there are exceptions, it can be quite dangerous holding a shorter
term position into an earnings announcement.
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Economic
Reports and
Events:
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Jan 24: -
Jan 25:
Crude Inventories 01/20 (10:30 am)
Jan 26:
Durable Orders for Dec (8:30 am), Initial Claims 01/21 (8:30 am),
Help-Wanted Index for Dec (10:00 am)
Jan 27:
Chain Deflator-Adv. For Q4 (8:30 am), GDP-Adv. For Q4 (8:30 am), New
Home Sales for Dec (10:00 am)
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Earnings
Announcements of Interest: |
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Only stocks with an
average daily volume of 500K+ are
listed. List may not be complete so be sure to always check your
stock's earnings date before holding a position overnight. (A) =
Earnings after the close, (B) = Earnings before the open,
(?) = Earnings time not specified at the time of this writing
Jan 24: MMM
(B), ADTN (?), AGR (?), AAI (B), AKS (?), BJS (?), EAT (B), BNI (B), CA
(?), CTX (A), CKFR (A), COH (B), GLW (A), CSX (?), DD (B), EMC (B),
EXTR (A), GDW (?), HMA (B), JNJ (B), KMB (B), LAB (B), LXK (B), LU (B),
NFLX (?), NOC (B), PPP (?), RFMD (A), RYL (A), STLD (?), STM (A), SUNW
(4:30 pm ET), NYT (B), TMA (A), TDW (B), UTX (B), ZION (A)
Jan 25: ABT
(B), APD (B), ATI (B), ALTR (?), AHC (B), ABC (B), AMTD (?), AMCC (A),
ASH (08:00 am ET), ADP (B), AVT (?), BLS (B), BMY (?), ELY (A), CHIR
(4:45 pm ET), CRUS (A), CL (?), CNXT (?), COP (?), DRE (A), EXC (B),
FIC (A), FBN (?), GD (B), HRS (A), HXL (A), INGR (A), IFIN (A), JNPR
(?), KOMG (?), LEA (B), LSI (?), MXIM (A), NYB (B), NCX (B), NVLS (?),
PMTC (B), PMCS (A), PLCM (?), PX (B), QCOM (?), ROK (?), SAP (B), SLAB
(B), SSTI (A), SWKS (A), SSCC (B), STJ (?), SWFT (A), HSY (B), MHP (B),
VAR (A), WLP (06:00 am ET), XRX (B))
Jan 26:
AFFX (?), ALK (?), AMGN (08:00 am ET), ANDW (?), T (07:30 am ET), AVID
(A), BAX (?), BEBE (?), BDX (B), BOW (B), BRCM (A), BC (B), CAH (B),
CAT (B), CLS (?), CELG (?), CPWR (A), ED (?), CY (B), DHR (B), DTAS
(A), D (B), DOV (A), DJ (B), EMN (A), LLY (?), ELX (?), EQT (B), FII
(4:00pm ET), FDC (?), FDRY (A), BEN (?), GM (B), GNTX (?), GFI (?), HIG
(A), HON (B), ICOS (?), NDE (B), INFA (A), IR (B), IDTI (A), IRF (A),
JNS (B), KEM (B), KLAC (?), KLIC (B), LSCC (A), LEG (A), LMT (B), LYO
(B), MRO (?), MEE (A), MCK (A), MWV (B), MENT (A), ,SCC (?), MSFT (?),
MLNM (B), NWL (B), NE (B), NOK (?), ORI (?), OPWV (?), PKTR (A), PLAY
(A), POT (?), DGX (B), RBAK (?), COL (B), SNDK (A), SHW (?), SO (B),
SYK (A), SU (?), TLAB (B), TEN (B), DOW (B), TSM (08:00 am ET), UIS
(B), UPS (B), VSEA (A), VRSN (?), VZ (B), WDC (?)
Jan 27: BDK
(B), CVX (B), FPL (?), HAL (?), MAN (B), NUE (?), PG (B), UCBH (?)
Jan 30:
ATHR (4:00 pm ET), CHKP (B), CMI (B), EK (B), XOM (?), FISV (A), KFT
(A), MAT (B), RSAS (A), SGP (B), SII (B), SYY (?), TSN (B), UNM (A),
ZMH (A)
Jan 31: ACE
(A), ADPT (?), ASD (B), ARTG (?), CCJ (?), CB (A), CIN (?), CEG (?),
CAM (B), COCO (B), CFC (B), CYMI (A), ELN (B), ETR (B), FLEX (A), GOOG
(?), HLT (B), ITW (08:00 am ET), RX (B), ISSX (A), JBLU (B), K (B), MRK
(B), SEPR (B), SIE (A), SGTL (A), STN (?), SYMC (?), TE (B), ERICY
(01:30 am ET), ALL (A), X (?), VLO (?), WYE (?), ZHNE (A)
Note: All economic numbers
and earnings reports are in lines with those compiled by Yahoo Finance.
Occasionally changes will occur that are made after the posting of this
column.
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