ONE EGG Scan for September 25th

Buyers like the housing data and decide to buy the dip? As I have stated more than once the last six weeks this is a choppy make yourself crazy trading environment. If you are a day-trader this is great. Swing trades are last two-three days and anything beyond that is just too choppy. Nice bounce today in the healthcare, consumer discretionary, consumer staples and basic materials sectors to lead the upside. The NASDAQ and Dow posted solid moves and the Russell 2000 Small Cap index was positive as well. Drinks for everyone as the market holds support.

I stated last night the¬†¬†week following options expiration in September historically has not been positive. That had been valid up to today, but we still have two more days of trading on the week.¬†¬†I still and looking for¬†a¬†pullback of 3-5% that we¬†discussed in the update. Stops are a must if you are still long short term positions. Longer term holding need to be evaluated in light of the moves. Manage the risk before the anxiety of selling makes you reactive versus being proactive. This dance isn’t over yet.

Running the EGG Scans¬†– First the daily winners…

Nice bounce off support for the broad indexes! Still cautious as news is driving the move.

Biotech (BIB) is back on the leader board with solid move on the upside Wednesday. Back to the previous highs and looking for a follow through on the upside move.

Gold Miners (DUST) back as a leader today on small test Tuesday. Downside still in play for now.

Philippines (EPHE) nice jump back from the short term selling and holding the uptrend intermediate term.

NASDAQ 100 (QQQ) bounced 1% on the day and posted as one of the leaders on the day. Held support from the selling and we will see how this unfolds short term.

Dow (UDOW) bounced 1% as well and hit the leader board for the first time in awhile. Watching to see if it resumes the previous leadership.

Small Caps (IWM) bounced on the day, but still show weakness overall.

Continued Watch Points: 

Gold miners (DUST) short side is exerting itself as the selling gains momentum once again. Gold and silver continue to push lower and little optimism in terms of the upside on Tuesday. The short trade is working well for now. Small test as gold moves on politics… tight stops on this trade if you have position.

Gold (DZZ) short side continues in the uptrend established off the August lows. (High for gold) Watch base to build short term.

Healthcare (CURE) bounced back to a new high and resumed the uptrend.¬†Tested on Monday and Tuesday, but nice bounce back to highs on Wednesday… still a leader.

Russia (RUSS) short side of Russia back as the pattern attempts to complete a move and establish the short trade for now. Watch bounce on Tuesday. It did follow through on Wednesday with the buyers stepping into the country ETF.

Technology (TECL) Testing lower and back towards the bottom of the current trading range. watching for some clarity short term. No clarity on Wednesday, but we did bounce back near the high of the trading range.

Semiconductors (SOXL) testing the conviction of the buyers currently. Watch. Nice bounce on Wednesday.

Financials (FAS) testing the move higher and causing questions. At support again? Small bounce on Wednesday.

As I stated in the market notes… patience and let this unfold.

Trade Considerations: 

DSLV – Short Silver ETF steadily climbing as the commodity falls in price.

Current EGG:

Financials tested the last two days and led the downside move on Tuesday. Nice bounce on Wednesday, but not enough to show leadership. If we cannot hold near term support we will take our exit and watch how it unfolds. I like the sector, but the negative is coming from a stall in interest rates. Patience is what we will exercise as we start the trading tomorrow.