Let’s take a look at the current action in the SPX and what I’m looking for today.
Sorry for the messy chart, but try to focus on a few major points
· First and foremost – We finished the day on significant horizontal support. If we fall below these levels today, I’ll likely be short biased.
· Weak volume. That’s not exactly what I would call much conviction to buy after a huge fall on Friday.
· MACD is swinging bearish
· We’re still in an overall downward channel
Now let’s take a look at the weekly. Same story. You can clearly see the falling channel here.
In this scenario (downward channel with strong moves from one side to the other), it’s still a scalper’s environment. However, keep an eye on these resistance and support levels. There may be some swings on moves through resistance and on bounces off support.
I would really like to see a move above 1082 before I consider too many swing moves to the long side. Until then, I’ll probable stick to scalps and news generated from earnings reports and economic data releases.
Careful with small and micro caps.. money has been running out of these lately in favor of mid and large caps. If you go small cappy, be cautious and you might want to reduce hold times.
Note: Housing Starts Data out today.
Here are a few low-dollar stocks I’m looking at for possible scalps.. again, not likely to go long unless we get a major move that takes the market out of the channel.
SSN – Lots of volume lately with large intraday swings.. may be some good scalping mojo in there somewhere.
OMEX – If OMEX holds SMA50, I’m interested. Ideal scenario – It pulls back to 1.17, then holds, then bounces for a scalp.
JMBA has horizontal support here at 2. Worth watching if the market recovers and we get some bids. I’m worried the MACD may turn negative and drag it lower, however, so be careful.
NVAX is coiling up just under SMA20. I would like to see a volume move north of SMA20 – maybe about 2.22 – for possible scalp.
VG tagged and bounced off of SMA50 today… It’s done this in the past. We could see a nice recovery soon for 20 cents, or so, in a scalp. I’m not interested if it falls below SMA50.
ARIA is about to test some resistance at 3.10. There will probably be some profit taking there, so I’ll be watching to see how it behaves. Since I’m not in, I’ll look for a move above before considering a position.
That’s about it for now. Let’s be realistic – the market has no direction and most individual stocks don’t either. I’ll spend more time this evening scanning mid/large cap stocks and less time on the currently loathed micros.
See you in the boom factory tomorrow.