Here’s today’s swing-trading watch-list:
Short American Airlines Group (AAL)
The Alcoa Analog (read about it here) was one of the cleanest trades I’ve suggested all year. It preceded a virtually uninterrupted plunge lower. I assumed that once it reached its long-term trendline, it would find support and gain strength. Nope – check out the chart below. The price fell well below the trendline, and, wouldn’t you know it, the trendline is now acting as resistance. It looks like Alcoa is going to remain quite ill.
I remember a trading bud describing the tape in the strong bear move in 2011 as angry badger tape. We’ve been seeing that again this week and I think we could see yesterday afternoon that the badgers are still angry. If you’re trading this intraday then you really might consider taking today off. If you are swing trading then watch the key levels carefully.
What are the key levels today? There is only one really important one today on SPX and that is the open gap from yesterday morning. That was retested and held in the wild move yesterday afternoon. As long as it holds and bulls make new highs today we should at least test 2000. If that support breaks then the bull case here falls apart and I would draw your attention to the nice looking double top setups on SPX, Dow, TRAN ……….. Scan 3x 15min SPX INDU TRAN charts:
I am struck by the similarity of almost all the indexes and ETFs I am looking out. Simply stated, the relief rally that I anticipated (exactly one day too soon, it turns out!) is raging away, and we’ve tacked 1300 points – THIRTEEN HUNDRED! – on the Dow in just a few days. The amount we may have left to go varies somewhat from index to index, but I’ve tinted below what I consider the major overhead supply zones for a variety of them. Enjoy!
I’ve been shorting again today, taking advantage of market strength. Here’s a new one:
After the market pullback that we’ve seen, of late, I thought I’d simply post the following Year-to-Date percentage-gained/lost graphs of a variety of world markets, to illustrate (at a glance) which ones are still “up” on the year (as of their close on Wednesday, August 26th)…presented without individual comment.
They can be monitored to see if they strengthen or weaken over the coming days/weeks, as a possible gauge of general sentiment for the remainder of the markets, particularly, those markets that have lost the most ground this year. (more…)