ONE EGG Scan for July 17th

Another positive day as investors respond to earnings. Upside is in gear again and with the Google news after the close we would look for today to be another positive at least for the NASDAQ which hit a new high on Thursday. Watching to see how the weeks ends on the news, but for now all is good and investors are showing signs of optimism at least for now.

Result for the Daily EGG Scan: 

Potential leadership results our scans produced for today…

  • CURE – healthcare moving back into the uptrend and hit new highs on Thursday. I continue to like this sector going forward.
  • INDL – India moves higher and breaks through resistance.
  • SOXL – not a leader on the scan, but the reversal is in place and looking for a follow through on the upside.
  • DWTI – short crude trade is back in play as the price of the commodity comes under pressure on the supply/demand side of the equation. Consolidating move higher. Stops in place. Analyst comments are helping build bottom in oil? Watching to see if the upside finds any legs.
  • SVXY – volatility gets taken out of the market on the buying to start the week. The index has now moved to 12.1 and posted a solid gain on the trade… overbought? raise your stops on this position if you own it.
  • BIB – Biotech made gap move higher and in position to test the June high. Nice follow through on Tuesday upside in play.
  • FAS – Financials gapped higher as well and looking for banks (KBE) to lead. Still moving higher, but bank earnings were a catalyst the last few days.
  • TNA – Small caps made follow through move to the start upside on Friday. Nice follow through this week and looking for the sector to regain leadership. Stalled at resistance and looking for follow through.
  • EURL – Europe broke above resistance on the bottom reversal. I like the near term at least technically.
  • Momentum is rising relative to the recent bounce on Greece and now the earnings data is kicking in to take the markets higher… at least for now. Need the fundamentals and data to take over is we are going to push through to higher ground.

Moves of interest trailing ten days: Big rotation in place near term.

  • DUST – short gold miners have been trending higher since the lows in June. It has some chop, but still worth the risk. Close above $21.50 to add positions and now managing the stops if it reverses at any point soon.
  • DWTI – short oil is now in a flag pattern consolidating the gains. A continuation is worth trading, but plenty of news/speculation on oil rallying? Caution on the commodity is a must. Watching the impact of the analyst comments on the upside for crude.
  • VNM – Vietnam moving back to the previous high and looking for the upside indicators. Nice follow through on Tuesday.
  • Big stall in the time horizon as the transition from selling to buying takes place on the charts short term. Not a big fan of the current volatility, but need to let this all play out as patiently as possible.

Current EGG Position:

Volatility has evaporated near term as the upside takes control of the direction. We have posted above trades that make sense, but still have not met the entry requirements relative to the EGG strategy. Five positive days helps restore some confidence and we will watch how this unfolds going forward.

This is clearly remains a news driven market which making trading a challenge. It has been challenging to hold trades and let them develop, but we have hit new highs on the NASDAQ and some leadership is showing in Financials, Healthcare and Consumer Discretionary sectors. We are essentially in an extended sideways market that is not attempting to break higher. News is driving the day to day activity. The shortened holding periods makes risk more imperative to manage. Not convinced that either side has control of the direction. Manage positions aggressively based on risk and discipline.