1/15 Watchlist: The Blue Chip Bears

Blue chip stocks (SPY) are showing a bear signal and have dropped 1.3 percent from the opening price. The price has stalled at very near term resistance. This comes amid falling interest rates on 20- and 30-year Treasury bonds, and falling prices for gold and oil.

In terms of other technical analysis on the blue chips, the stochastic has crossed below the 80-line, a bearish signal. The macd remains in bullish territory. The price was approaching the upper Bollinger band, and the bands were widening, which can be taken as signaling continuation of the upward trend.

The blue chips have been in a strong upward trend since March. This signal is countertrend, and not a trade for me. Especially with so many mixed signals.

Here's what's interesting among high-volume . . .

. . . exchange-traded funds (ETFs): XLF, which tracks the financial sector, shows a pps bear signal amid a sideways trend that began last July IWM, the Russell 2000, bear signal XLE, Energy sector, bear signal in a rising trend DIA, the Dow Jones Industrials, bear signal as a companion to that of SPY XRT, retail sector, bear signal in a rising trend XLU, utilities, bear signal in a downtrend that began in mid-December; its trading above the 50-day moving average but below the 20-day; the price is now at very near term resistance, and it stands only 1.5 percent above major resistance. So, not a trade for me. XLI, industrial sector, bear signal, uptrend

None of the funds are a trade for me today. XLU was the only candidate, where the signal matched the trend. The others are countertrend.

. . . corporate stocks:

• WFC, bear signal. The trend is sideways, but it's a bank and is expected to face taxes so the feds can recover the cost of bailing out the financial sector, so I would count this as being with the trend. It stands 1.7 percent above near-term resistance and is sort of bouncing around a major peak set in December 2000. I probably won't take the trade; financials make me nervous because of the revenge-laden political atmosphere

Lots of counter-trend bear signals, suggesting the possiblity of some topping going on. If these establish new downtrends, then I'll be interested.

My two holdings that expire today, KO and LVS, will be profitable. (yay).

Among the February expirers, MRVL has dropped below its stop-loss and my bull position needs to be closed. The CVS iron condor remains in profitable territory and is behaving just as I hoped it would. ORCL is retracing yesterday's range.


New to Private Trader? Check out the Reader's Guide.

Topics:
S&P 500, SPDR, Spiders, CVS, pharmacies, drugs Coca-Cola, Las Vegas Sands, gambling, resort, Marvell Technology, Oracle, financial sector, Russell 2000, energy sector oil natural gas, Dow Jones Industrial Average DJIA, retail sector, utilities, industry industrial factories, Wells Fargo.