Daily Trading Journal 6/30/14

The major indices continue their “time correction” as small caps and the Nasdaq 100 grind higher while the large cap indices continue to flag above their prior breakout area and short term moving averages. Bias remains neutral/higher as long as we hold above these prior breakout areas in the major indices. Global equity markets were mixed on the day with Indonesia (IDX, EIDO), leading to the upside up nearly 2% and Russia (RSX) leading lower down 1.65% on the day. Bonds continue to base above last week’s breakout over 112.50 and looks like it will test the highs near 115 in the near term.

Leaders to the upside included gold miners (GDX), semiconductors (SOXX, SMH), oil services (PXJ, OIH), utilities (XLU), homebuilders (XHB), gaming stocks (BJK), and telecom (XTL).

Laggards on the day included aerospace & defense stocks (PPA), industrials (XLI), health-care (XLV), large caps (DIA), financials (XLF), reits (IYR), and consumer staples (XLP).
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Daily Trading Journal 6/27/14

Another day of updside for the major indices with all of them except the Dow printing a bull engulfing candle, while the QQQ’s closed at new highs above Tuesday’s topping tail. Bias remains neutral/higher above the 10/30 day SMAs. Bonds closed lower on the day near yesterday’s opening price but remain with a neutral/higher bias above support at 112.50 (TLT). Global equity markets were mixed with the majority higher with Norway (ENOR) leading to the upside up 1.04% on the day and Greece (GREK) leading to the downside at -1.36%.

Today’s leading sectors included oil services (OIH, PXJ), small caps (IWM), reits (IYR), mid caps (MDY), retail stocks (XRT), homebuilders (XHB), and aerospace & defense stocks (PPA).

Today’s lagging sectors included steel stocks (SLX), basic materials (XLB), healthcare stocks (XLV), agricultural stocks (MOO), energy (XLE), and the Dow (DIA)
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Daily Trading Journal 6/26/14

Today the major indices experienced some intraday volatility but moved higher throughout the day to close near the flat-line. Overall, we remain above the 10/30 day SMA so the bias remains neutral / to the upside. We may be experiencing a working off of overbought conditions through time rather than price moving lower. Technically Tuesday’s reversal day is still valid as we haven’t taken out the highs but we continue to hold up well and there is a lack of downside follow through so I don’t see a reason to run for the hills. Bonds closed up another .50% on the day with TLT targeting its old highs of 115 after yesterday’s breakout. Topping tail needs follow through to confirm to the downside but above 112.50 bonds remain bullish. Global equity markets were mixed on the day with Australia (EWA) leading to the upside up 1.4% and Polan (EPOL) leading lower at -1.55% on the day.

Leaders on the day included gaming stock (BJK), solar stocks (TAN), steel stocks (SLX), gold miners (GDX), oil services (OIH,PXJ), and coal stocks (KOL).

Laggards on the day included semiconductors (SMH,SOXX), consumer staples (XLP), financials (XLF), homebuilders (XHB), agriculture names (MOO), and aerospace & defense stocks (PPA).

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Daily Trading Journal 6/25/14

Today’s action in the US stock market indices was a prime example of why I choose to follow price and market behavior using technical analysis rather than using on analysis that relies on fundamental information or economic data. First off, consensus was well off with their estimates for US first quarter GDP growth leaving everyone surprised when the economy contracted, falling 2.9% in the first quarter according to the latest revision. Not to mention, economic data is constantly revised anyway which makes it extremely tough to utilize, but nonetheless, I’ll move on to the next point. Now that we know that the GDP print was horrendous, most people would think that after yesterday’s intraday reversal we may see some downside follow through today? right? Well, not exactly. When the cash session opened, on what turned out to be the lows of the day, the major indices rallied throughout the day to close on the highs, pretty much negating yesterday’s negative price action. These constant, seemingly unexplained market movements, is exactly why I choose to follow price and not obsess over why something is occurring. We, as market participants, must trade what is actually happening and not what we think should logically occur. The constantly reiterated lesson the market teaches me on days like today is to focus on probabilities and finding good risk/reward scenarios. Forget about why, focus on what and when. To each their own process and methods though, I just find following price works best for me.

Anyway, the major indices closed moderately higher on the day after opening on the lows of the day. The lack of downside follow through is concerning for any bears that took a short against yesterday’s highs and today’s action continues to support a possible time correction by continuing to move sideways in the major indices. Global equity markets were mixed on the day with Turkey (TUR) leading higher up 1.66% and Greece (GREK) leading the losers down 1.35%. Bonds (TLT) broke above 112.50 to clear the highs of the base it’s been forming and looks like it will test the recent highs near 115 as discussed yesterday. Bias in the major indices remains neutral/higher after yesterday’s topping tail reversal saw no downside follow through and we remain above both the short and long term moving averages.

Leaders to the upside included solar stocks (TAN), oil service stocks (OIH, PXJ), social stocks (SOCL), gold miners (GDX), healthcare (XLV), transports (IYT), and shippers (SEA).

Laggards on the day included consumer staples (XLP), reits (IYR), gaming stocks (BJK), financials (XLF), industrials (XLI), large cap biotech (IBB), and aerospace & defense stocks (PPA).
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Daily Trading Journal 6/24/14

Today the major indices traded above yesterday’s highs to start the session, but reversed and headed lower mid-way through the session to close down on the day. The VIX was up 10% to close with a 12 handle as the S&P 500 had its first 1% swing in roughly a month or so, but point is, it has been a while nonetheless. If you were looking for a good risk/reward short in the major indices today was the day to put it on as they printed significant topping tails and closed lower, leaving a clear level to stop out above for more aggressive traders. In addition, there have been negative momentum divergences accompanying this reversal, which provides additional support for trying a short here. Ultimately, we will have to see whether there is downside follow through over the next couple of days, or if we just work off these extended conditions over time by moving sideways. Global equity markets were mostly lower on the day with Greece (GREK) leading lower with a 3.17% loss on the day, while Russia (RSX) closed up another 1.5% today but printed a significant topping tail as well. Bonds, as measured by TLT, continued higher off the 10 day SMA after building a base of support above 111 throughout June. TLT looks like it will test the recent highs near 115 after working off overbought conditions and allowing momentum to reset.

Leading sectors on the day included large cap biotech (IBB), utilities (XLU), gaming stocks (BJK), healthcare (XLV), reits (IYR), and homebuilders (XHB).

Laggards on the day included solar stocks (TAN), gold miners (GDX), oil services and energy (OIH, PXJ, XLE), aerospace & defense stocks (PPA), coal stocks (KOL), semiconductors (SOXX), and small caps (IWM).
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