2/16 Watchlist

Blue-chip stocks (SPY) have moved up into a region of contegstion set in late January and early February. The exchange-traded fund is showing a macd bull signal for the first time in 17 trading days. The associated fear index, the VIX, is down slightly from Friday's close. A decline in the VIX generlly means a rise in SPY.

Treasury long bonds (TLT) have pulled back up from this morning's decline and are trading at the top of a three-trading-day range. It continues to show a macd bear signal.

High-yield corporate bonds (JNK) are trading at the top of the range set last week and have traversed 1.3% low to high in trading today. The macd is bearish, as it has been since mid-January.

Gold (GLD), which gapped up this morning, is trading narrowly at its new level. Oil (USO) also gapped up and is showing more activity, having traversed 2% today from low to high. The euro has strengthened against the dollar (EUR/USD), no doubt because traders now think that the EU will help Greece deal with it's debt. There has been much talk about the collapse of the euro under the weight of indebtedness by the less robust members of the eurozone. The forex chart never supported that. EUR/USD is trading at 1.3765, which puts the euro higher than it ever was from 1993 through 2006. The decline is basically a retracement of about 50% of the rise from September 2008 (collapse of capitalist finance) to December 2009. You would think that market writer's for the major publications would learn to read a long-term chart. Emerging markets (EEM) have moved up to an area of congestion set in late January and early February. The etf is showing a new macd bull signal.

Euan Sinclair covers the basics of volatility in options trading, but then goes a step further, as he describes how behavioral psychology can create market conditions traders can take advantage of-and how it can lead them astray.

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

. . . exchange-traded funds:

• Gapping up with macd bull signals, the broad-based big dudes: QQQQ (NASDAQ), EEM (emerging markets), IWM  (Russell 2000), DIA (Dow Jones Industrials)
• Also gapping up with bull signals, commodities: GLD (gold), SLV (silver), USO (oil)
• And also, SMH (semiconductors), XLE (energy), IYR (real estate), XLK (Amex technology), XLB (materials), XLI (Amex industrial), XME (metals and mining).

So today's upward movement is pervasive. Hint: If anyone tries to sell you on the notion that one or two things caused the rise, run away. It's not terribly credible.

. . . corporate shares:

• JPM, macd bull signal, up 3% today low to high and trading, around $39.77, in an area of congestion. Downside support is around $37, and upside resistance levels are $41 and $45. The trend is sideways.
• X, bull signal on a breakout above near-term resistance. Trading around $51.22, the next resistance is around $65. The stock has been in a long-running downtrend. This could be seen as the start of a new uptrend. Not an unreasonable directional play. AKS, another steel company, also opened strongly higher, on a macd bull signal. Trading at $23.28, resistance is at $26.75. The prices rose after AKS announced it was raising its prices.
• AAPL has gapped up slightly on a macd bull signal that kicked in Friday and strengthened today. It's in an area of congestion, trading at $203.25, and has major resistance peaking at $215.59.
• MRK, which I've seen credited in some news reports as the cause for the market rise, after earnings opened 2% above Friday's close, rose a bit, sank a bit, recovered a bit, and now stands half a percent below it's open. Not a major move, certainly not one to move the markets as a whole. It is showing a macd bear signal persisting since late January.

None of these really meets my criterial for  trend. AKS can be made into a decent iron condor bounded by support and resistance.

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Topics:
S&P 500, SPDR, Spiders, Treasury bonds, high-yield corporate junk bonds, emerging markets, gold, precious metals, oil, petroleum, NASDAQ, Rusell 2000, Dow Jones Industrial Average DJ30, silver, semiconductors, energy, real estate, Amex technology, materials, Amex industrial, metals mining, JP Morgan Chase, United States Steel, AK Steel Holding, Apple computing Macintosh iPhone iPod iPad Mac, Merck pharmaceuticals.