3/1 Watchlist

The blue-chip stocks (SPY) have peaked today at $112, or 0.4% above the previous near-term peak on Feb. 22.

In terms of prices, the pattern has turned ambiguous. It can be seen as a lower high (if prices were to turn down from the $112 level on the daily chart), a continuation of a downtrend.

Or the price could continue up to above the next high, $115.14 set on Jan. 14, in which case a correction of six weeks or so has come to an end and SPY in the uptrend that began in March 2009.

XRT mfi overbought

The retail exchange-trade fund, XRT, saw its money flow index move into overbought territory, a bear signal.

The price has risen 9.7% since Feb. 5, with a couple of small pullbacks along the way.

The macd has been in bull territory since Feb. 11 and continues a full 0.2 above the zero line.

Today's upward push slightly overshot the previous high set in early October 2009 and puts the price at a resistance level set in August 2007.

2/11 Watchlist

Blue chip stocks (SPY) moved up sharply today, traversing 1.4% low to high. Shares hit $108.25, topping the $108.15 high set two days ago, and then pulled back slightly.

Treasury long bond (TLT) prices pulled back from their low but remained below yesterday's open. High-yield corporate bonds (JNK) rose to the mid-range of yesterday's decline.

The move in stocks positioned SPY near a short-sell point for swing traders looking to profit from the 3- or 4-day trend reversals. The move comes on the fourth day since the cycle low, $104.58, on Feb. 5, a point that also serve as support for the shares.

A significant pullback before the close today, as I see it, would indicate a bear entry point, either by selling shares short or buying puts. (Traders who hedge could sell a bear call vertical spread.)

Lacking a pullback, I would expect the uptrend to continue in early trading on Friday.

2/4 Watchlist

Conditions noted in the Morningline remain as I described them, except more so. The stunning movement comes with the U.S. dollar declining by 2.8% against the Japanese yen (calculated high to low), and rising 1.3% against the euro.

Reuters says it's because recent news has increased an aversion to risk. But I ask, in today's markets, how is it less risky to vote for the yen and for the dollar in trading on the same day? Either side of these trades, there's risk galore. As for the VIX . . .

2/3 Watchlist

Despite the apocalyptic headlines on some market stories ("U.S. Stocks Falter"), the distance between the open and close in blue chip stocks (SPY) today is at this point measured in a few cents. Not much on a stock trading for 109.84.

It's not yet the end of the world. But remember, 2012 (a level hit by the Dow 23 years ago) may be just behind the corner.

So relax! Don't worry!! Be happy!!!

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 . . .

1/12 Watchlist: SPY, many etfs show bear signals; Fear flies;

Blue chips (SPY) show a pps bear signal on a decline of 1.1% from Monday's close. The mfi and stochastic are falling toward their respective 80-lines. The macd remains in bull territory. The price remains above the 20-day moving average.

The decline is consistent with a minor pullback within an uptrend that began in early March 2008. A decline below the ma20 would suggest a larger decline, such as that seen in June and July last year, as well as in September, October and November.

The blue chips' bear signal coincides with a gap up and sharp rise in volatility (VIX, the fear index). It is trading 9.2% above Monday's close.

Gold (GLD) also shows a bear signal and a 2.2% drop from yesterday's close, with the 20-day moving average below the 50-day moving average but the price above the 50-day. Oil (USO) shows a similar pattern with a pps bear signal.

Bear signals all over the major exchange-traded funds. See below

Otherwise, the signals on indicators and currencies remain as described in the Morningline.

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

12/21 Watchlist

It's Christmas week, and I'll be scanning in holiday mode this week and next: I'll check out the indicators and currencies, and of course watch my holdings like a paranoid hawk.

But, for new entries, I shall be scanning only a few high-volume etfs, and most likely won't be opening any new positions. might be opening positions, if they're really compelling, as SMH seems to be (see below).

A new bear signal on the fear index (VIX), but oddly not on the blue-chips (SPY) whose volatility the VIX measures. The VIX is trading at 20.33, down 5.3% from the open. The signal comes two days after a bull signal amid a downtrend that began in January.

Treasury long bonds (TLT) shows a bear signal, two days after giving a bull signal. TLT is trading at 91.55, down 0.5% from the open.

Otherwise, no new signals on the indicators, the currencies or my holdings.


High-volume etfs (ignoring shorts and multiples):

• QQQQ (the NASDAQ), bull signal in an uptrend that begin in March. The etf has given three signal reversals in six trading days.
• XLF (financials), bull signal, strong uptrend began in March, and a less convincing retracement downward in October.
• UYG (financials), bull signal, uptrend began in March, retracement in October.
• XRT (retail), bull signal in a sideways trend since October, reversing Friday's bull signal.
• SMH (semiconductors), bull signal on a gap up, in an uptrend since March and a sideways trend since the beginning of December.

The SMH signal is the most convincing of the lot.

12/11 Watchlist

BMY rose again today after a bull signal at yesterday's close. It has been in an aggressive uptrend since late October and has about $2 to go until it hits upside resistance set in January 2008. (Yes, I pegged it as a sideways trend in yesterday's Watchlist. I broadened by view.) It's looking interesting as a possible play.
BAX, a bull signal yesterday that looked interesting but which I didn't trade, has shown a strong rise for the second day and has pierced resistance set in September.

New signals among other high-volume stocks and etfs, with the direction of the signal and the trend in which it has occurred:

• ORCL, bull, uptrend since March, sideways since October.
• SMH, bear, uptrend since March
• HD, bull, uptrend since March (trading at resistance)
• CTL, bull, uptrend since March (whipsaw from bear signal given three days earlier)
• BRCM, bear, uptrend since March (strong reversal at resistance)
• DIA, bull, uptrend since March, sideways since November (trading at resistance, whipsaw from a bear signal given four days earlier)
• XRT, bull, downtrend since October
• POT, bear, uptrend since October
• AXP, bull, uptrend since March (about $4 away from upside resistance, but this is the fifth signal given in 11 days, so clearly the stock in neither a bull nor a bear but a confused puppy)
  

Of those, AXP is interesting because of the distance from resistance, but the false signals worry me.

Holdings:

UNG, a covered call (-c9) that expires in eight days, has fallen to 9.53 and remains profitable.

Of the January expiry holdings, there are no new signals.

X, a bear spread (-c40/c41), which has moved contrary to my bearish position, is pulling back a bit but remains worrisome.

AET, a bull spread (p31/-p32) that showed a nice rise this morning, has pulled back to within yesteday's trading range.

HPQ, a bull spread (p49/-p50), is stalled at the cusp of profitability.

KO, an iron condor (p50/-p52.5/-c57.5/c60) remains above the range of max profit at expiration.

No new signals among the indicators.