ONE EGG Scan for March 12th

It is Thursday all ready and the sellers have control, but I will say it is modest control and the buyers are still engaged and not forgotten. It is still a choppy market that has no clarity on direction relative to the Fed and interest rates, the economic growth picture in the US, economic growth in the global markets and a strong dollar that has gone vertical. We will have to move the worries out of the way if the upside is to resume.

Thus… the leaders are on the downside over the last 3-5 trading days.

Result for the Daily EGG Scan: 

Leadership outlook…

DUST – gold miners fall as GLD tests the $111 support. Wednesday rumors of M&A and buyouts was on the analyst lips and the buyers stepped in despite the downside move again in gold… worth watching. Side note we hit the stop on the trade.

YANG – China bear fund moving higher as economic data validates issue with the growth and interest rates rising. Move above the $11.40 mark is of interest as trade opportunity.

ERY – Short energy sector as the price of crude fails to hold any move on the upside. $75.30 target on XLE. Hit on Wednesday and could continue lower based on the price of oil and negative sentiment in the broad markets.

DTO – short oil trade is in position to break through resistance at the $100 mark. IF oil continues lower this will offer short term trade opportunity. Hit the $100 entry and nice move. Watching the price of crude on downside short term as it is at support.

SDS – Short S&P 500 trade set up on the move lower Tuesday. $21.85 entry next level on move higher. Hit closing at $22 and still looks ready to move. But… let it unfold and set your stop.

UUP – dollar continues higher gaining strength as global picture remains weak. EUO has gone vertical.

Treasury bond bounce Tuesday is worth watching as well. TMF followed through on Wednesday as money rotated again to safety.

Watching IWM as small caps made nice move on Wednesday versus other indexes.

Some short side momentum in sectors worth our attention, but need to be patient and gain some clarity near term on direction.

Current EGG Position:

I was looking for confirmation on the sell side Wednesday, but didn’t really evolve. We did add a partial trade with SDS on the upside follow through. We watched the open and did get some acceleration late morning, but stalled right after the entry hit and closed flat on the entry. Today will be key on the follow through, but it could very well shift to positive. Either way we manage our risk and take what the market gives.

Small caps were a surprise in the afternoon moving higher as money migrated that direction. A confirmation of leadership in the sector would act more as a positive for the markets overall. Worth some attention today.