ONE EGG Scan for April 14th

Early buying, late selling and the indexes closed on the downside.¬†Global continues to lead with plenty of concerns over China, bonds are pscycho over the Fed hiking interest rates, commodities are speculative at best, dollar is dominating the currency markets and US stocks are waiting for the proverbial shoe to drop on earnings… in other words nothing changed on Monday. Patience and disciplined approach are a must.

Result for the Daily EGG Scan: 

Leadership outlook…

YINN – China’s pushes higher again with the move going¬†vertical. Took some gains off the table on Thursday, adjust stops higher and watch. Nice gain on Monday, and¬†still in play with concerns overnight about the outcome.

RUSL РRussia is moving higher, but the volatility is a challenge for many. Upside is catching momentum again with the move higher. Took some profits early Friday, watching how it unfolds on the balance.

EDC РEmerging markets have benefited from the positive global money rotation into China. Solid rally with small test, but followed with a continuation of the move higher and back above the 200 DMA. Raise stops to $27.25 and let it run.

ERX – Energy is trying to push higher, but the volatility in crude oil is keeping the progress slow and steady. Nice gain on Thursday to recapture the loss from Wednesday. Trend off the March low still in play and $66 the target on the trade. $60 entry (on test) to add a position is attractive currently.

KRE – regional banks moved back near the previous highs with the start to earnings beginning today. Regional banks are favorable longer term if the Fed will follow through with rate hikes. $41.40 level to watch.

OIH – Oil Services, like the broader energy sector making move. The bottom range is now back at the high and in position to reverse the downtrend. Nice set up and entry at $36.50.

EUO – Euro moved lower and the short trade moved through the entry at the $27.05 level on Thursday with the target at $28.50. Still like this trade if it tests lower early.

Watching this week: RUSL, GASL, BIB, UCO, SOXL, EWZ, SPXL

Watching today: UCO, BIB, KRE

Possible EGG Position:

Sold lower on the worries in the US over economy takes energy sector¬†lower. Added ERX to the watch list failed to capture the trade Friday as the intraday pattern setup gave a higher entry point of $60.40. I am still watching for the test this week and entry. (tested Monday and watching to see what happens today.) I expect this to be a volatile position and we will give it more than normal room… thus, 1/2 position to manage the downside risk of the trade.¬†Entry $60 and we will take a 1/2 position. $56.20 is stop. $66 is the target.

Also looking at OIH in the energy sector as alternative trade. As stated above a break above the $36.50 give good entry point. Adding to the table as well to start the week.