Trading Notes for Today – May 15th

Solid break higher for the S&P 500 index and the markets overall. The move continues to find rally points to push through any resistance and continue make new highs. Protect your risk and keep moving forward.

Sectors to Watch:

  1. Healthcare sector followed through on the upside break. XLV, XBI, IBB, IHF, XPH, IHE, & IHI all breaking higher for the sector and continuation of the uptrend.
  2. Agriculture (MOO) consolidating near the $55.25 mark and ready to move higher? Look for break to add to position as trade.
  3. Small Cap (IWM) is showing the rotation towards growth. The challenge with the sector overall is the softness of the economy. Upside remains in play.
  4. Technology is consolidating near the high short term. Didn’tĀ participateĀ on the upside and we are looking for confirmation of the current levels. Tighten your stops and watch how today, plays out.
  5. Utilities (XLU) – broke the first level of support at $40.30, held at the key level of $39.65. Looking for a bounce play and opportunity to add to the position. $39.95 move marks for opportunity to add to the position. If this breaks down and clears the 50 DMA short to $38.25 is in play.
  6. Energy – (XLE) tested the breakout at $80. Followed through on Tuesday and looking for the defined leadership. This is a sector to dig in and find opportunities. XOP (break above $60.60) and IEZ (break above $59.30) both offer plenty of interesting stocks. The following are just a couple I am watching near term. NFX – The break above the $23.35 level is an opportunity. CHK – break above $19.65 is positive (accomplished on Tuesday – lookingĀ forĀ confirmation). DO – break above $75 resistance. Look for the upside to follow through short term higher.
  7. Pattern Setups For Today: 1)Ā  V – Pennant pattern and looking for a continuation of the upside break on earnings. 2)Ā  BAC – Pennant pattern set to break to new near term high. (Nice break higher for the stock) Ā 3)Ā  ORCL – Break above $33.95 resistance and fill the gap left on missed earnings. June 17th next earnings. 4) BSFT – cup pattern breakout at $25.70 5) UNG – bottom reversal? Need to see break above the 21.75 mark.

Market continues to set new highs and money flow remains positive. This is a market you ride the upside and see what happens, but the longer it goes the downside risk that builds. Watch, manage and protect your money as this unfolds.