Yesterday the market showed signs of the bottom falling out, today the market is acting like yesterday never even happened.
That creates a market that requires blind faith when buying and blind faith when shorting, because regardless of the support that is broken or the breach in resistance that is achieved, there really is no boundaries for the market in terms of consistencies in patterns it tries to form.
Instead the market can be compared to a feather that floats aimlessly while caught up in an afternoon breeze.
So focusing on tomorrow, there is just as good of a chance that SPX finishes up 1% higher as it does with finishing 1% lower. The edge in determining short-term market direction is absent yet again. With that said, I have provided some of my short setups, but I haven't acted on any of them, as the market is pressing the shorts hard today, and provides us with no reason as of yet to add any of the short setups below. The 2120-2122 range on SPX is going to be key going forward and if it can break back above it, there may be a slight edge for the bulls to play with.
Here's the list of short setups:Read more...
Short KLA-Tencor (KLAC)
Short Schlumberger (SLB)Read more...
This could be one of the worst collection of long setups I've put together in a long, long time.
And trust me, it's not me, it's the charts. The setups are simply getting destroyed out there today.
There are a few gems out there, like WDAY and QLGC, but WDAY reports earnings after the bell today, and quite frankly, if you are into the whole knife catching experience when it comes to this stock market, then by all means, go for it. But as for me, I am avoiding the long setups like the plague, and sticking with my lone short position that I have remaining in the portfolio right now.
Also worth noting is that there's probably a 50% chance that the bulls can put together some kind of bounce tomorrow in the form of a dead cat bounce. Today's technical damage is mind numbing, and there is nothing fake about it. The VIX is up 18%, T2108 (% of stocks trading above the 40-day moving average) is down a whopping 23% down to 38% overall.
So the weakness is there, and it is very apparent, and this just happens to be the first legitimate sell-off that we have seen since making new all-time highs last week.
So yes, I'm holding off on these long setups. They are nowhere near being ripe and need to mature a bit more before even giving consideration to them.
Here's the (sort-of) long setups for this week:Read more...
Long Transocean (RIG)
Long ArcelorMittal (MT)Read more...
Long Microsoft (MSFT)
Long Hasbro (HAS)Read more...
Long Packaging (PKG)
Long NXP Semiconductor (NXPI)Read more...