It’s almost the end of what has been quite a week. The market finally broke out of its congestion range under SMA20 (SPX) on Tuesday reducing some of the market jitters and opening the doors for more speculative trading. The only concern was the volume associated with this move. Over the last two days, we’ve consolidated just above SMA200, with a repeat of low-to-average volume levels we’ve seen now for 5 trading days.. in other words – no conviction.. market is neutral into options expiration.
What I’m looking for Friday:
If you haven’t noticed, there has been some not-so-impressive economic news out lately. First, it was retail sales (not horrible, but not great), then employment numbers, then regional manufacturing, etc. On a positive note, Europe seems to be settling down somewhat.. but, we need more good news than that.
Overall, I’m still a little apprehensive. It just doesn’t feel like the market is very confident and we could easily see a dip below SMA200 again. However, with options expiration tomorrow, it’s really hard to say where we’ll go. I will likely NOT swing stocks into the weekend, but, instead, will continue to pick up scalps throughout the day and look for momentum pops. Technically, this consolidation is attractive and could setup the next bull move, so the message is generally mixed.
Here are a few stocks that look technically attractive and worth watching Friday.
NG – Another triangle. Same setup as the others. I like the volume improvement over the last few days. Possible entry above SMA100.
That’s all for now – See you in the boom factory tomorrow.