EGG Scan for June 18th

Sluggish start builds momentum, and as we discussed on Friday, the bounce off support is the winner for now. The S&P 500 Index was the example with the test of 1925 on Thursday. Our choice was to bounce or continue lower. The obvious answer at this point is to bounce and make another run at the 2000 mark.  Scanning the sectors we still finding a mixed response as we have shown below with the lack of clearly defined leaders short term. This is hot money chasing momentum versus conviction over direction. We have to still be cautious and let this play out in the short term.

To make the point I left the last three trading days plus today’s results below. There are some parts surfacing and attempting to exert leadership, but the overall results are mixed.

Running the EGG Scans – First the daily winners…

  • Today’s leaders – TAN (Solar), PBW (Clean Energy), SVXY (short VIX), TNA (Small Caps) and FAS (Financials). Honorable mention KRE (Regional Banks) & KRE (Banks).
  • Monday’s leaders – UPW (Utilities), XBI (biotech), IHI (Medical Devices), TAN (Solar) and DIG (Energy). IHI benefited from the acquisition in the sector. TAN is EGG today.
  • Friday’s leaders – YINN (China), ERX (Energy), TAN (Solar), SOCL (Social Media), USLV (Silver) and RUSL (Russia).
  • Thursday’s leaders – UCO (Crude Oil), SIL (Silver miners), GDXJ (junior gold miners), TAN (solar power) UGAZ (natural gas), and DBE (energy).
  • Wednesday’s Leaders – RUSL (down 4%), SOCL (down 0.7%), PALL (down 4.5%), FCG (up 1.4%), JMF (down 1.3%) I stated they gave a different look, and that look didn’t last for more than one day.

Energy remains a leader and has now added the alternative energy sector to the upside move. Crude remains above $106 with modest adjustment today. Solar energy made the move to break higher and resume the previous uptrend. Russia is still retreating on the Ukraine news and the arguments are back on the front page, moved well below the stops at $20.05. So much for the selling scare from last week as the buyers remain willing to put money to work. We still are going to take one day at a time.

EGG Model Watch List:

EGG Tracking…

  1. 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:

TAN is the Egg Model at $42.30. Nice rise today as the interest on the break higher in the sector invited money into the sector with Solar City leading the upside gaining 18% and Ja Solar was up 9%. Solid move higher and we continue to monitor the position and adjust our stops.