EGG Scan for June 12th

Wednesday was more chop and grind for the broad markets. The positive scan came up with only 150 ETFs versus the 300+ and shows the impact of the negative trading day.

Running the EGG Scans – First the daily winners…

  • RUSL, SOCL, PALL, FCG, JMF were the top five positions based on our criteria. Different look from what we have seen over the last three weeks.
  • GDXJ, RUSL, XSD, DSL and ERX were on our basic scan as leaders on Wednesday. With a couple of exceptions more in line with what we have been tracking of late.
  • VIX moves up slightly and put VXX on our watch list.
  • SKF shows up in the scan as financials have a tough day.
  • XME represents the miners with GDX and GDXJ moving up nicely the last couple of days.
  • SDOW showed the negative day for the DOW.
  • SIL – Silver miners have done well over the last week up 7.2% off the low. The break above $12 was attractive on Wednesday for trading opportunity with tight stop.

Putting it all together we get some rotation on emotions, but not enough to change the tide on the upside. Thursday may offer more insight on this topic, thus for now we will be patient and let it play out with more clarity.

EGG Model Watch List:

EGG Tracking…

  1.  XPH did break higher showing strength in the large cap pharma stocks. This is a better representation than PJP we have been tracking of potential upside. Move above $99 was the upside confirmation.
  2. BRCM – giving the best look relative to the semiconductors leadership. $31.15 entry last week was optimal looking back. Thus, a test of that level and hold, or a move through $31.50 on volume would be of interest for a EGG trade on individual stock level. Got the early move last Thursday (entry $31.50) and it followed through on Friday. News pushed the stock up 12% last week. Sold half at $35 and $34 stop on the balance. See how this plays out… the news wasn’t that earth shattering and willing to take my gift of gains. Nice bounce back towards the highs the balance of the week. Raise stop to $37 on balance of shares. Topping and volume falling back to normal tighter stops and watching.

Current EGG:

KBE 32.50 entry. Banks made the break higher and the market trend continues higher. The follow through move helps the upside in the broad indexes and we continue to look for the upside in financials as it attempts to take on a leadership role near term. Stop is $33.05. (watch to take 1/2 the trade off at $33.30 if we open with negative bias.

That is what we did – sold 3000 shares at $32.26 and holding 2000 with stop at $33.05. Watch how we open and make any necessary adjustments relative to the futures.