ONE EGG Scan for June 12th

Held the move from Wednesday and that was a small victory for the buyers. The follow through is still needed to validate the move off the lows, but for now the buyers have the microphone. Looking at the scans from Thursday’s trading not much changed near term. The shift in momentum is the focus, but that will require some patience and a trend strengthening event. Some say Greece… not. Some say sentiment data out this morning… doubtful. It will have to be a combination of things to convince buyers that the risk of ownership short term is worth the risk that is currently perceived in owning stocks. Too  much correction and bubble talk in the headlines creating some discomfort along with a list of worries that will make you sea sick. Watching how today unfolds on the final trading day of the week is the goal. Tough to establish new positions on Friday… but, we will take what the market gives.

Result for the Daily EGG Scan: 

Potential leadership results our scans produced for today…

  • UNG – jumped to establish a bottom reversal trade on Monday… watch. BOIL 2x leverage ETF for trading the commodity. $43 entry on upside move follow through and reversal. Nice pop on Tuesday to add to the reversal. Manage your exits.
  • UCO – crude made move higher again? Watch the volatility of this move. Followed through to resistance on Wednesday. $46 stop on the move lower on Thurday.
  • DUST – short gold miners back on the list with break above the $15.20 level. watch for opportunity. Testing the move higher. Followed through nicely, but tested. Moved higher on Thursday and move stop to break even.
  • KWEB – China internet stocks moving higher again and worth watching. Nice follow through last two days.
  • KRE – regional banks get big pop on upside move with jobs report strength.
  • VNM – Vietnam break higher off double bottom… needs follow through on new push higher.

Moves of interest trailing ten days:

  • UWTI – upside in crude showing up in the 10 day scans. Watch for break above resistance in commodity.
  • EDZ – five day jump puts it in the top ten. 13% gain. short emerging markets. confirmed again with the move higher. Downside is still at risk short term.Stops managed as this hits resistance of the 200 DMA. Reversal and stops in play.
  • BIB – biotech at resistance and break higher is of interest. Consolidation at the high.
  • TMV – short treasury bonds continues to play out on the Fed threat to raise rates. Playing out nicely on the upside. Tested lower on Thursday.
  • KRE – regional banks taking on leadership role for the broader markets. Nice follow through on upside move.
  • SRS – Short REITS as interest sensitive assets still moving lower. Raise your stops on risk of this playing out short term. Tested on Thursday.
  • FAS – financials are creeping up the leaders column. banks are leading the charge.
  • Some rotation in the two week trend cycles. We want to capture the move that meet our criteria.

Current EGG Position:

IWM was the watch for Wednesday as the small caps have held up well in the midst of some selling in the broader indexes. Look for entry at the $124.85 level on the day. Got the move early on the day and it followed up with move higher on the day. Entry was $$125.10. Stop $123.70. Modest move on Thursday and looking for the upside follow through to clear $126.53.

This is clearly a news driven market making trading a challenge. Swings trades are struggling to follow through and creating to many whips in and out. No trends or continuation of trends. Testing is the trend and it has extended into a sideways market. The week started out similar to last week… no direction near term. News is driving the day to day activity and the insecurity is showing in investor 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 the current environment.