Trading Journal 4/15/14

Today the major indices put in large bottoming tails on heavy volume and closed on the highs of the day. The elevation in the put/call ratio yesterday and topping tails in the vix suggest that today was the start of a bottoming process in the major indices. Although we are still below key short term moving averages, ¬†yesterdays reversals combined with today’s potent moves higher, the bias has now moved to neutral/higher. Global equity markets were largely lower on the day with the standout to the upside being Singapore (EWS) which closed up one percent, despite some intraday volatility. Bonds (TLT) are at a new high closing at 111.13 and grinding higher above rising short and long term moving averages. Large cap stocks continue to hold up better than small caps and technology at the moment and should see new highs first if this pivot low sticks.

Leaders to the upside included utilities (XLU), energy and oil service names (XLE, OIH, PXJ), healthcare (XLV), large cap biotech (IBB), financials (XLF), and transports (IYT).

Laggards on the day included solar stocks (TAN), gold miners (GDX), steel stocks (SLX), gaming stocks (BJK), coal stocks (KOL), and homebuilders (XHB).
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Trading Journal 4/14/14

Today the broader indices gapped and held higher after some intraday volatility. The leaders continue to be large caps as measured by the S&P 500 and Dow while the pressure remains on small caps and technology whom are now comfortably below the 150 day moving average. Global equity markets were mixed on the day as well with Russia (RSX) and Greece (GREK) leading to the downside closing down just over 3%. The Nikkei bounced a bit today, but remains in an short term downtrend and is below the key moving averages after breaking its intermediate term trend earlier in the year. Bonds (TLT) printed an inside day but remain above resistance in the 109 area and are back above rising short and long term moving averages. Despite the bounce in stocks today, we continue to remain below key levels in the major indices as the short term moving averages roll over and will act as resistance moving forward. Additionally, RSI still has room to the downside before reaching an oversold level that will catch investors attention. We likely maintain a neutral/downward bias on the major indices until we see further signs of a bottoming process develop. Active traders can take advantage of opportunity on both sides of the trade, but less continues to be more in terms of the sustainability of short term moves until we build out a base.

Leaders to the upside included oil service names and energy as a whole (OIH, PXJ, XLE), gold miners (GDX), steel names (SLX), semiconductors (SMH), and large caps overall (SPY, DIA).

Laggards on the day included solar names (TAN), gaming stocks (BJK), homebuilders (XHB), large cap biotech (IBB), social stocks (SOCL), and small caps (IWM).
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Trading Journal 3/25/14

Another day of a relatively wide trading range in the major indices with large caps outperforming small caps and technology as a whole. The story continues to be old tech stocks such as MSFT, IBM, HPO, etc… catching an aggressive bid and breaking out over the past few weeks. Bonds printed an inside day as they look to test overhead resistance in the 109 area in TLT. Global equity markets were higher across the board with the exception of Vietnam (VNM) and the Philippines (EPHE). Small caps and the Nasdaq 100 bounced on light volume off oversold conditions and trend line support, but remain vulnerable below the 8/21/50 day EMAs.

Leaders to the upside included oil service stocks and energy (OIH,PXJ,XLE), steel stocks (SLX), semiconductors (SMH), industrials (XLI), and healthcare stocks (XLV).

Laggards included solar stocks (TAN), retail stocks (XRT), social stocks (SOCL), gaming stocks (BJK), consumer discretionary (XLY), and small caps (IWM).

In the commodity space, platinum futures broke trend line support and remain below all the key moving averages. Need to let it base at these levels and setup again on the long side. Short opportunity below today’s low.

Heating oil closing back above the 8 day EMA and seems to be trying to setup a catch-play type long. Below 2.88, next support at 2.83.

Oats breaking down below the neckline at 410 and testing support at 400. Next support below at 380.

Natural gas bullish engulfing candle on light volume. See if it can continue above today’s high and close above the 8 day.

AUD/USD breakout continues. Resistance at .9240 and 94. Support below at the rising 8/21/50 day EMAs. Still looks great on the short/intermediate term.

Daily Trading Journal 3/24/14

Weakness continued in the major indices today as the Nasdaq 100 and small caps lead the market lower. Both small caps and the QQQ’s bounced off trend line support and the 50 day EMA and printed a hammer candle on heavy volume. This gives longs a reference point to trade against if playing for a bounce, but we remain vulnerable below the 8/21 day. Bonds were higher on the day as they look to test the 109 area of resistance in TLT. Global equity markets were mixed on the day with India and Greece leading to the upside while Colombia, Thailand and Turkey lead to the downside. I haven’t really had a chance to analyze the price action of the past few days, but at first glance it looks like we remain in a volatile range until we break support at the 50 day EMA. Today’s low provided a point of reference to trade against as we came into support and active shorts likely covered and tried some longs rather than pressing. Obviously you want to see a break above today’s high and close above the 8/21 day EMAs to regain bullish momentum.

Leaders to the upside included coal stocks (KOL), steel stocks (SLX), utilities (XLU), telecom (VOX) and financials (XLF).

Leaders to the downside included gold miners (GDX), large cap biotech (IBB), social stocks (SOCL), solar stocks (TAN), small caps (IWM), and healthcare (XLV). A lot of momo names have been very week in the past few days. The heavy volume and bottoming tails today in biotech and technology as a whole could be signaling some capitulation and a buying opportunity against the day’s low.

In the commodity space, gold pulling back further into trend line support in the 1309 area. Now solidly below the 8/21 day as they curve down. Next support at 1300 and 1275.

Silver grinding back to the downside as it moves into support around 19.80-20 though it is back below all the key EMAs.

Copper continues to build a range between 2.90 and 3.00. Watch for a close above the 8 day EMA that may provide entry for a short term catch play long setup.

Natural gas drifting lower with the 8 day EMA as resistance. Support 4.19.

Wheat testing its recent highs after holding the 8 day EMA. Like I’ve been saying, it remains bullish until we break and close below the 8 day.

Soybean oil trying to hold the 50/100 day EMAs at 40.90, but remains weak below the 8/21 day EMAs that are now sloping downward. Next support at 40.35, 39.90.

Corn closing in the upper part of its recent range testing 490, and looks to want to breakout soon after testing the 21 day EMA. Still remains a great chart on a short/intermediate and long term basis.

Palladium making new highs intraday with some negative momentum divergences. See if it can build this upper level base and work off these overbought conditions. Still think palladium looks good on an intermediate basis after last week’s backtest of the breakout area.

Platinum continues to hold trend line support at 1430.

Cocoa selling pressure increasing as it broke and closed below the 21 day EMA on Friday. Next area is the 50 day 2911 and 100 day at 2825.

Sugar continues to look weak below falling 8/21 day EMAs. Support 16.47, 15.90.

Soybean meal flagging above 455 as it looks to make an attempt at the intraday highs of 472.90 in the coming days.

Oats remain a mess. Head and shoulders pattern with neckline at 410. Below 410 support at 401, 380.

Soybeans continue to hold the 21 day EMA and look to want to test the recent highs after some more basing action above 1365. Closed at 1431 on the highs of the day (light volume).

Cotton bearish engulfing candle after being rejected by resistance at 93.50. Back below the 8/21 day EMA, immediate term bullish momentum is no longer there.

AUD/USD continues its breakout and looks like it will test .9237 in the short term on its way to an intermediate term price target of .94 as per the breakout of an inverse head and shoulders pattern.