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Thursday, December 31, 2009

Thursday New Highs

There were 227 new highs today, here is the list.


These are the high volume advancers from the relative strength list.



These are the high volume decliners.

This weekend things should be returning to somewhat normal. Saturday I may or may not have an IBD 100 post, as the guy who delivers IBD to the local outlets is notorious for not making deliveries on holiday weekends, so it all depends on whether or not it is available. The relative strength scan will most likely be posted Saturday, as I am taking advantage of the long weekend to expand my database, and I will be doing the scan tomorrow, but want to leave extra time in case of screw-ups. I will also have at least one rant this weekend, and maybe even some fun stuff off the net. Enjoy your weekend, and Happy New Year.

2009 In The Can

On a day like today, with a well defined range and just about everyone gone for the New Year, what could possibly go wrong? Whoever it was, somebody big decide that the last half hour was time to get out in a big way. The drop was breathtaking, and happened so quickly I just sat and admired it. It;s been so long since we've seen a big volume bailout at the last minute, it was truly a sight to behold. 1121 fell rather handily, putting us in a new range as the year end, and putting a somewhat bearish tone to start the new year with. Will it make a difference? We have 3 days to forget about it, so it probably won't. But somebody seems to be anticipating a January sell off.

Despite the last half hour, this week's close was the second highest of the year. MACD continues to bend but not break, and unbelievably stochastics still point upward.

The Dow industrials show more signs of weakening than the SPX, and getting higher here is going to be much more of a struggle. On the bright side, the CNBC anchors may get another chance to wear their DOW 10000 hats.

The Nasdaq is completely confused here, with MACD whipsawing and stochastics not sure which way to go. It has retraced last year's crash and is now in the 2008 price congestion zone.

The Russell 2000 may have an ambigous MACD, but the stochastics leave little doubt that the upside momentum is stronger here. This has a good chance of retracing the crash, with a target around 675.

The poor Transports, after spending almost 2 months leading the market up, must feel like they've been kicked in the teeth. The indicators are reversing yet again, but it is still above the 10 week moving average, and the bears are kust blowing smoke unless they can break it.

2009 has been an interesting year, and a disappointing one for me. Had I followed the O'Neil system religiously, I would have made a hell of a lot more money than I did. 2010 may give us another chance at it.

I will have the new highs update shortly.

CRMT


Breakouts were a little sparse today, especially among leading stocks. One that did break out and held on to it's gains was CRMT, which formed a deep base. Despite a big drop during the base, CMF only went slightly negative and quickly recovered. The price relative is on the weak side, but it did get a big price move on a modest increase in volume.

Today's Leading Industry


Today's leading industry is dairy products, a 6 stocks group that is moving on the big gains from it's biggest stock, WBD. Above are the top four in market cap, WBD and DF beint the gorillas of the group, the rest under $1 billion in market cap. The group as a whole is in a down trend, but WBD is buckking that with a ferocious uptrend.

Options Data


Today's unusual options treading, from whatstrading.com.

Breakout Candidates

I guess I wasn't kidding when I said that there weren't many good breakouts today. Here are the top 4, ranked by relative volume.

Thursday Morning Update


Despite better than expected numbers for initial and continuing claims, the market has opened on a down note. 2009 is coming to a close, and while I'll probably have a retrospective on the year some time this weekend, my initial reaction was much the same as I had in 2007; disappointment, because I could have done a whole lot better had I not underestimated Bernanke's capacity to put short term pain ahead of long term gain. We avoided the short term pain of markets finding their real bottoms by reflation, but only to make the next collapse that much worse. We are still playing the 1121-1131 range to near perfection, oscillating around the 1126 pivot. XLF is leading today, with relative strength in XLE and XLY, with XLK and XLI lagging. Despite the weakness of XLK, the Nasdaq is holding it's own, but the Dow is lagging today, with the Russell 2000 showing some relative strength. Gold and oil are both up a bit.

There are 159`new highs today, with few high volume breakouts, but some to look at include TKTM, VIMC, FSIN, and AEIS. Once again, it is all quiet on the earnings front. The new earnings spreadsheet will be uploaded later tonight or early tomorrow.

Wednesday, December 30, 2009

Wednesday New Highs

There were 187 new highs today, here is the list.



The high volume advancers from the relative strength list.


The high volume decliners.

The Decade From Hell Winds Down

I haven't looked at the one year charts for a while, mainly because it give us no idea where any potential resistance might be. Since we recently hit a new hig, the trendline has changed again. Nomally a broken trend line signals a potential chnge in trend, but we've broken at least 3 trend lines since March without much happening. One thing of note here: The SPX has followed the dollar (or more properly, the inverse), until this month. The divergence is slight, but noticeable. Does it mean anything? Probably, but we don't know what until we start getting the big volume back. CMF has been in a decline since August, but the July ramp was so sharp that it is hard to draw conclusions there, either.

The Dow is showing basically the same thing. I put both the simple and exponential 200dmas on the charts, and they are converging. Again, that may or may not have any significance.


Unless this is an optical illusion, the trend line on the Nasdaq seems to be at a lower angle than the SPX. CMF is also intersting in that it corroborates the early strength of the Nasdaq (Marxh through July), and recent strength, sinc CMF has yet to go negative. The Nasdaq also does not have the December dollar divergence we see in the SPX and Dow.

I hate using the IWM as a proxy for the Russell 2000, but it's the only way to get an idea of what the volume is doing. Interestingly, CMF is quite strong of late, but, again, I cast a skeptical eye on ETF's. This also has a steeper trend line than the Nasdaq. I suspect that the strengthened dollar has helped this in recent weeks.


The Dow transports resembles the Nasdaq most closely. CMF is still positive, the trend line is about the same steepness, the only real difference is the price relative line with the dollar. This, the Russell, and the Nasdaq were relatively weak in the October-November time frame, but now are the relatively stronger. This kind of rotation usually occurs when the market is in an uptrend.

Finally, congratulations are in order to you taxpayers. You are now the majority owners of GMAC, the finance arm of the former Dow component, GM. Bailout Fever is not dead.

I will have the new highs update shortly.

DECK


DECK was one of the better looking breakouts today, breaking through a serious resistance at 100. Price relative is a little weak, but ok, but CMF is a bit odd: it has been declining despit the big volume gap up in October. CMF is not the most reliable indicator, but a descrepancy this big rings my paranoia bell.

ENTN

Since the attempted Christmas terrorist attack, stocks related to airport security have been getting huge bursts in volume. Had it not been for that, this was a pretty awful chart. Those guys who sold last week must be staring at this in disbelief. I'm usually pretty skeptical about news related breakouts, and this one is no exception.

ICXT

ICXT is another homeland security stock that for some reason got a much bigger boost in volume today. One thing that is interesting here is the top resistance line, which is the high of 8.48 from back in January. If you take the distance from that level to the lower support level, the middle resistance level is almost exactly half the distance. Probably a coincidence.

Today's Leading Industry


Today's leading industry is semiconductor - memory chips, a 9m stock group. The top four gainers are above, which include the top 3 stocks in market cap. SSTI is one of the lagging small caps that is making a big move. The other laggard, RMTR, is so far going nowhere.

Options Data

Here is today's unusual options trading, from whatstrading.com.

Today's Auction Results

Here are the results of today's 7 year treasury auction. As with the other auctions this week, indirect interest was low. This does not seem to be having much effect on the stock market, but yields dropped on the news.

IMAX


IMAX has been in a ferocious uptrend since March, pausing only to form a few well formed bases. This is probably now in the last stages of it's uptrend, but that doesn't mean it can't stage a pretty spectacular gain from here. With the recent increase in volume, it's quite possible this will run up to a blow off top, and who knows how long that will last.

The numbers are pretty consistent with a high growth stock. the float is too large for it to be considered for my earnings watchlist, which is why it escaped my attention before. 5 year and recent earnings growth are quite high, Finviz does not have a figure for ROE, but that can be found just about anywhere else. O'Neil believes that an ROE over 17% is the hallmark of a high growth stock, and my experience bears that out.

Breakout Candidates


Here are the top four breakouts in terms of relative volume, to my knowledge none are on earnings.

Wednesday Morning Update

Yesterday we tested the range 1126-1131, so today naturally we are testing the bottom, 1121-1126. We had a pretty nasty drop at the open, but a sharp reversal with the Chicago PMI numbers released this morning. Everyone believes that the economy is staging a miraculous and complete recovery, and they had better be right, because with artificially low interest rates, enormous budget deficits, and the largest companies in the country on life support, we will need a complete recovery, and I mean complete. Not the crap "jobless recovery" we had in 2003. I hope you like paying lots of taxes, because the bill is going to come due pretty soon. Anyway, today's leading sectors are XLK and XLU, lagging is XLY followed closely by XLB and XLF. We have a crrude inventories report due today (time unknown) which will undoubtably move crude oil prices, and the last treasury auction of 2009, a 7 year auction. Other than that, there isn't much moving the market, and I expect a lot of technical testing today.

I have 108 new highs so far, with breakouts in ENT, VIRC, RAME, and KTII. All is quiet on the earnings front.

EDIT: Crude oil inventories have come in, and inventories are higher than expected, which is going to put pressure on oil.

Tuesday, December 29, 2009

Tuesday New Highs

There were 311 new highs today, here is the list.


These are the high volume advancers from the relative strength list.



These are the high volume decliners.

Toxic Tuesday Summary

We seem to have a new resistance level at 1130, coflicting technicals signals, and just barely enough volume to make things interesting. MACD is looking like it is trying to reversse a longish down trend, but stochastics are looking like they are running out of gas. We are probably due for a decent drop, perhaps as low as the 50dma, but it won't likely happen fast.

The Nasdaq has a bigger fall to get to the 50dma, and I don't expect it to fall that far. Stochasticsts do not look as "tired" as those on the SPX, and MACD looks stronger, so this could outperform (drop less fast) if the market does drop.

The Russell 2000 could be hitting another wall here, as it dows appear upward momentum is weakening. A bounce off 625 would be incredibly bullish, but even a drop to 615 will not do much damage. About the only bearish scenario is a drop through 605, but by the time it gets there the 50dma will be there as well. There is just nothing suggesting the market is that weak right now.

Oil has made a sudden and sharp reversal off the 200dema, and after being initially repelled by the 50dema, broke through it. It has a pivot point at 79.50 that it is sitting just above, and has momentum to go higher, although that appears to be slowing down. We might get another small pullback here before another try at getting back to 82.


Gold is bouncing around nearly perfectly on the support and resitance levels it has established. The run up to 1200 was apparently overdone, and the subsequent correction brought us right down to the breakout point. We just got rejected here at the 50dema, but like oil, it may take another shot at it.

The SPX barely covered a 4 point range today. 2009 is going to go out with a whimper.

I will have the new highs update shortly.

GMCR

GMCR seemed to be giving up it's leadership role after topping in October, and went into a deep decline. It reversed suddenly and for no apparent reason early this month, and has been on a tear ever since. O'Neil does not like V-shaped bases, as they have a higher probability of failure on the breakout. This may need some more consolidation before it makes another leg up.

UQM

One project I have been working on (with not much success so far) is keeping track of stocks that get sudden icreases in volume, as UQM did in July. It is a good method of finding stocks that are likely to make big short term moves, as this one has. This is one of the few breakout stocks in recent days that has a strong price relative line, and has shown accumulation since CMF dipped back in September. If volume keeps increasing, this move will continue.

SPNC


SPNC broke out today on news of a settlement in a federal investigation of the company (I didn't bother to get the details). Except for the big volume today, this chart doesn't have much going for it, and the volume is not likely to continue.

IVAN


I once read an "expert" who said technical analysis doesn't work with stocks under $5 (his reasoning was that big institutions don't buy them). It sure is odd, then, how well IVAN has held support and resistance levels. The bottom support level, near 2.50, also happens to be the 50% retracement fot the move from the July low to the September high. I don't have a reason for today's move, but it has been getting a steady increase in volume since September.

Today's Leading Industry


Today's leading industry in internet service providers, a 5 stock group that has been in a recent down trend. The 5th stock in the group, CTCH, is ironically the one with the best relative strength, but is negative on the day today.

Options Data


Here is today's unusual options trading, from whatstrading.com.

5 Year Auction Results


Here are the results of today's 5 year auction. Nothing unusual here, and it is not moving the market.

Earnings List Additions

I have finalized the additions to the earnings list for the coming quarter. Since I now have about 6 quarters worth of data, I am not only looking for rapid recent grwoth, also consistent longer term growth, which means that some of these will have unimpressive but steady growth numbers. I am also going to be firm aboout the 30 million shares floating limit for all new additions. Hopefully the combination if more data and better riteria will result in fewer deletions every quarter. The list is now up to 79 members, and ultimately i hope to have it up to 100 next quarter. The new additions are:

AMED, CFSG, CSKI, CTFO, CYAN, EMCI, ESI, ESLT, HOGS, ISRG, KMGB, KPPC, LL, LPHI, NEU, SBSI, SXE, TIS.

The spreadsheet will be updated on Friday.

Breakout Candidates


Here are the top four breakouts in relative volume. None are on earnings and none look particularly compelling.

Tuesday Morning Update

1131 was approached for the second day in a row, and for the econd day in a row it repelled the SPX. Volume appears to have the potential to be quite a bit higher than yesterday, but still should be low. We had a couple of economic reports this morning, the Case-Schiller home price index, better than last month but worse than expected, and the Conference Board consumer confidence, also better than last month but worse than expected. nether seems to be moving the market. Also of note today is a $42 billion 5 year treasury auction. After yesterday's disappointing 2 year auction, this could be interesting. Leading sectors are XLB, which s in front by a mile, and XLI and XLU, lagging are XLF and XLK. We have the Dow leading this morning, The Nasdaq and Russell 2000 lagging. I mentioned last night the we might start seeing some rotation again, and this could be the start. Also of not, the VIX has been just below 20 for several days now.

I have 197 new highs so far, with breakouts working out in UQM, UNAM, CZZ, TRGL, and GMCR. There is not much happening at all on the earnings front.

Monday, December 28, 2009

Monday New Highs

There were 488 new highs today, here is the list.



Here are the high volume advancer from the relative strength list.



These are the high volume decliners.

IS Anyone Home?


Recently we've been seeing big gains at the open, followed by not much else happening during the day, but today, whithin the first hour of trading, gave back the opening gain. From there we went negative, but volume just wasn't there to hold the market down, and it ramped up into the close. Treasury announced (on Christmas Eve, when no one was paying attention) that the government is essentailly giveing FRE and FNM infinite backstops, possibly setting the stage for the two zombies to buy up all the trash now on the banks' balance sheets. Treasury yields have been rising recently, which may be a sign they saw something like this coming. What this will mean for the housing market is unknown, but rising rates can't be good for it. Anyway, the SPX is now in a new range, to make it simple, a 40 point range right above 1100. CMF is going nowhere, as no one is buying into this market, but no one is selling either.


The Dow industrials are the weaker version of the SPX, just now breaking into new ground (for the year).

The Nasdaq, by contrast, has been the stronger of the indexes, and still has a CMF well into the positive. If recent history is any indication, at some point (probably soon), this will reverse again, with the Dow strong and the Nasdaq weak. Rotation happened about a month ago, and may be running it's course now.

The Russell 2000 was relatively weak today, but one day is not enough to reverse a trend. However, again if recent history is an indicator, this will weaken soon and underperform for a while.

About the only news today was the 2 year Treasury auction. The yield, already in an uptrend, went up through the 200dema. I thought that the number of indirect bidders was pretty low, although that could possibly have been due to the holidays. If that was the case, why the Treasury would issue $44 billion in debt at a time like this is beyond me.

I will have the new highs update in a bit.

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