ONE EGG Scan for January 16th

Swiss add to the frustration of earnings and markets continue to sell lower. The are at key support levels and futures are pointing lower… A test of the low is the best case a break lower is more likely to end the week. The risk/reward of the short term trades is elevated due to the volatility and thus, we will be patient for now, but the short trade is being put in play on the break if it unfolds today.

Sectors Worthy of Attention: 

FXI is volatile, but working it’s way to a new high. It is one of those positions that is like riding a roller coaster. Still looking at the upside trade.

Gold minders are attempting to make a break higher as gold makes a move. Just when you think a sector will offer some trading opportunities in turns into the same psycho as the over all market has been the last couple of weeks. Watching to see if the downside continues to accelerate beyond the 5% drop the last two trading days. THURSDAY: bounced back 5% and puts it back in the upside move.

Downside views in S&P 500 index (SPXS) $21.10 entry is interesting. Hit the entry on Monday’s selling. Still showing downside vulnerability.

NASDAQ Index on downside is renew selling. QID $40.20 entry is selling continues. Hit the entry on Monday’s selling. Still gaining some downside momentum.

Result for the Daily EGG Scan: 

TMF – treasury bonds continued move higher on yields moving lower.

DUG or ERY – Short energy sector trades broke out on Monday and followed through on Tuesday. Some testing on the gains in crude on Wednesday, but that is likely a short opportunity on the rally. Watch.

VXX – Volatility index trade broke higher on Monday. Followed through on Tuesday and Wednesday.

SOXS – short side of semiconductors setting up.

SKF – short financial trade is setting up following the wreck on earnings this week.

Markets are still playing the worry game as the uncertainty is the name of the game. The selling this week has been mixed with investors still uncertain of trusting the data and oil price worries. Trading environment as long term views remain a flip of the coin with a bias on the downside. Risk/Reward remains to high on the risk side and willing let the volatility calm some and some confidence return on either side short or long.

SDS or SKF setting up to trade.