Traders Corner   26 comments

Since February 13th, the S&P 500 has traded between 1823 and 1847. The problem with the markets right now is the technicals are too close to overbought, so every move up seems to push them into overbought territory. The Williams %R is still in overbought territory on both the daily and weekly charts. The McClellan Oscillator is still too close to overbought to allow for more than one strong bullish day. Even though the all-time high is only a 1% move from Friday’s close, it seems like miles away with the resistance at 1847.

On the other hand, markets don’t seem inclined to fall much either, with a firm support level forming at the 1823-1826 range.

With Janet Yellen’s Senate testimony coming Thursday, I would be surprised to see a break-out move before then. However, if her Senate testimony is anything like her House testimony, we may see more bouncing between levels, as bulls and bears hear what they want to hear. It is possible we may be stuck in this trading range until the next U.S. Employment Report on March 7th, unless Yellen says something to move the markets.

The S&P 500 levels to watch today:

UPSIDE: 1841-1847 (5 data points), 1849-1850 (January’s high, December’s high and the all-time high), and 1860 (top of the Bollinger Bands).
LAST CLOSE: 1836.
DOWNSIDE: 1835 (2 data points), 1830 (February 13th’s high), 1823-1826 (5 data points), 1815 (February 12th’s low), 1814 (50 day moving average), 1809 (February 13th’s low), 1798-1800 (3 data points and the 20 day moving average), 1791 (February 10th’s low), 1784 (February 3rd’s high and the 100 day moving average), 1774-1776 (2 data points and October’s high), 1770 (January’s low), 1767 (December’s low), 1758 (February 4th’s high), 1755 (February 5th’s high), 1752 (February 6th’s low), 1749 (150 day moving average), 1745 (November’s low), 1743 (February 4th’s low), 1739 (February 3rd’s low), 1738 (bottom of the Bollinger Bands), 1737 (February 5th’s low), 1729 (September’s high), and 1721 (200 day moving average).

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Posted February 24, 2014 by edmcgon in Daytrading, Investing, Market Analysis, Technical Analysis

26 responses to “Traders Corner

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  1. GTAT announced earnings this morning. While they were decidedly unexciting, they did state that they will be returning to profitability in 2nd half of 2014. Here is what CEO said:

    Our arrangement to supply sapphire materials to Apple is progressing well and we started to build out the facility in Arizona and staff the operation during the quarter,” said Gutierrez. “We are pleased to have Apple as a sapphire customer and to be in a position to leverage our proprietary know-how to enable the supply of this versatile material. While our primary focus during the balance of the year is to continue to execute on our commitments in Arizona, our aim is to position GT not only as an exceptional sapphire supplier to Apple but also as an unparalleled world-class supplier of sapphire material and equipment to a variety of customers.

    “Although we have significant opportunities in sapphire, the GT story is not only about our emerging sapphire materials business. In fact, our entry into sapphire materials may enable us to expand into other materials segments once we have fully ramped the operation in Arizona. The many diversification and investment seeds we have planted over the last several years in the LED, power electronics, advanced solar and industrial markets are expected to begin to bear fruit over the next 18 months. We are seeing significant interest in our new products and now expect equipment orders from these initiatives to be received during the latter part of 2014, with meaningful revenue recognition beginning in early 2015.”

    Everyone needs to do their own due diligence. And it is very difficult to know what the income will be from these initiatives. But to me, GTAT looks like a high growth story through 2016, and the market generally loves growth.

  2. Whoa – GTAT up 11% in early trading.

  3. As we start the day, still no weakness in the S&P. I don’t think we are close to being overbought.

  4. Silver is on the verge of a breakout. We’ll need a few days to confirm.

    • Hey Trader, what route do you take for investing in silver, AGQ? SLV? Something else? Thanks.

      • I use AGQ. When I play etf’s, I only use leverage. You have to determine your comfort level with risk. Nothing wrong with SLV if it helps you sleep at night.

  5. A few transactions today. I sold all my SBS. That is a Brazilian Water Utility. It is highly regulated and I did not like the way rates were losing ground to inflation. This was pretty much a break-even transaction for me, I bought at 9.54 and sold at 9.39. Then I bought PM (78.60) – people may recall I thought about RAI last week. PM is the Intl arm of Phillip Morris and pays a 4.7% dividend. Finally, I added to my AOD position (closed end fund) at 8.33. All three moves were part of my dividend portfolio, which are intending to provide income and be longer term stable positions.

  6. I added SPXU at $58.90, will sell it at $59.49 or best price later. I might carry it into tomorrow.

    • Good luck Ed. Seems like a high risk play for a small gain.

      • Trader,
        With Williams %R being overbought for over 10 trading days, and the RSI near overbought, and the McClellan Oscillator likely to be overbought after today (assuming the markets stay at their current levels), I consider it a fairly low risk trade.

      • Ed, you may get lucky. I don’t see the overbought conditions you see. Trying to catch a small down move in a market showing strength seems like a high risk move.

  7. Sold some March 9 calls on PRAN for 1.15. Still have more that is not covered. Too early to tell if it will break out from here.

  8. Also – just added to my KLIC position (about 15% add) at 11.52.

  9. RIP Harold Ramis, great writer of comedies.

  10. DLIA interesting spec stock rallying today on a SA article.

    http://seekingalpha.com/article/2042783-delia-s-is-poised-to-triple

    • Thanks for sharing. That poised to triple writer seems to be very successful. Certainly worth putting on watch list.

      • I bought into DLIA when they hired Tracy Gardner last year. Like the author stated she is considered to be top notch in fashion industry and brought alot of talent in also. Unfortunately she is trying to turnaround the company in what has been a horrible retail enviroment this last year.

  11. Latetom, you asked the other day (friday?) about RGR. I added 50% to my holdings today at 68.97. Karl

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