ONE EGG Scan for June 18th

FOMC meeting set the tone on Wednesday, but the challenge remains somewhere between belief and reality. It is believed the Fed will hike rates, but the reality part is where the struggle still remains. Interest rates were flat on an announcement they wanted to hike rates twice before year end. Bank stocks fell on the new. The dollar fell on the news. All point to a lack of confidence in the reality of this happening? It was a¬†confusing response… but, it is what we have to deal with in a news driven market. Today should offer some clarity relative to the Fed and the markets reaction.

No need to speculate… just watch how this unfolds on the day and we will go from there.

Result for the Daily EGG Scan: 

Potential leadership results our¬†scans produced for today…

  • UNG – (UGAZ) jumped to establish a bottom reversal trade. Hit the stop on Friday as some profit taking surfaced from buyers. Watching for reversal and entry relative to the move higher. $2.45 entry for UGAZ.
  • 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 and move stop to $16.Hit the stop as the lack of confidence in the Fed bought into inflation talk if the Fed doesn’t act.
  • KWEB – China internet stocks moving higher again and worth watching.
  • KRE – regional banks get big pop on upside move with jobs report strength. Consolidation at the highs. Testing with some volatility.
  • VNM – Vietnam break higher off double bottom… needs follow through on new push higher.¬†hitting some resistance at the $18.25 mark.
  • YANG – short China showed up in the scans from Monday. Break higher shows the growing weakness in China. $63 entry looks good if the downside remains. Still selling in the country ETF.
  • SIL – bottom reversal move on Monday and worth watching to see if it unfolds.
  • IHF – healthcare providers moved back to the previous highs and ready to continue the uptrend.
  • TNA – Small caps attempting to break higher… watching.
  • RUSL – bottom reversal with solid move on Tuesday. Watching for entry point.
  • TMV – short side of the bond trade ready to move higher? Fed reaction?

Moves of interest trailing ten days:

  • UGAZ – sustaining the upside has not made the list as one of the leaders with momentum.
  • DUST – nice move higher and taking a leadership role on the downside micro-term. Buying in gold rocked the upside move… watch today?
  • EDZ – Short emerging markets. Consolidating near the highs. Stops hit. Resistance of the 200 DMA in place.¬†Watching for this to resume the upside.
  • 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¬†to end the week. Watch for resumption on the FOMC speculation early in the week.
  • KRE – regional banks taking on leadership role for the broader markets. Nice follow through on upside move.
  • ERY – short energy trade continues to trend higher. Uncertainty about oil prices has the sector stalled. Take it for what it is.

Current EGG Position:

IWM was the watch for 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 and it followed up with move higher. Entry was $$125.10. Stop $123.70. Modest move with solid gain on Tuesday to push back near the high of $126.53. Close and watching how it plays out today.

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.