ONE EGG Scan for June 22nd

Selling on Friday was in response to Greece default with the emergency meeting on Monday. Noise, not much more. The US markets are getting comfortable with the idea of a Greece default and when it happens it may be more of a relief than tragedy.

Leadership is still after thought for this market and each attempt… sector by sector has failed to produce enough to lead the markets higher. That said, we still see some opportunities, but we have to approach each with the understand of the current market environment and manage the risk accordingly.

Result for the Daily EGG Scan: 

Potential leadership results our¬†scans produced for today…

  • BIB – biotech breaks from the current trading range leading the upside.
  • CURE – healtchare breaks higher as well clearing the current trading range.
  • SOXL – bottom reversal still holding faint hope of follow through.
  • TQQQ – NASDAQ 100 index made solid move to the upside to lead the major indexes Thursday. Test Friday. Today?
  • TNA – Small caps make the break to new high and needs to take on the leadership role.
  • 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. Nice follow through on the upside.

Moves of interest trailing ten days:

  • TNA – nice breakout on the upside to new high to follow through on the move higher.
  • FAS – financials are making headway on the upside as the money rotated into the sector on interest rate hikes. Positive for lending and bottom line.
  • YANG – short side of China is in play with some consolidation near term.
  • BIB – biotech at resistance and break higher is of interest.¬†Nice break on the upside as the leader.
  • 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. Hit our entry at the $124.85 level and it followed up with move higher. Entry was $$125.10. Stop $124.50. Cleared the high of $126.53 and made the break higher on Thursday and looking for the upside move. Raised stop.

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.