Monday, May 18, 2015

$ANTM $MLM & $REGN: A Wrestle For The Market

Bulls and Bears Wrestle For The Market 
I'm not sold on the commitment of institutions to the market right now.  For the past 3 months $SPY, $QQQ, and $DJX have been trading in a very narrow 2% range. It appears that bulls and bears are stuck in a wrestle for the market with no clear winner yet. For me, this is unsettling because institutional behavior gives me the signs I need to predict momentum.  Right now they are holding their cards close to their chest so finding quality growth stocks has become more difficult than usual.

Breaking Down Market Conditions
According to IBD, we've got a “Market in Confirmed Uptrend” as of Thursday May 14th.  The last two times we had a confirmed uptrend, the market went back to “Market under Pressure” within a few days. What's more, all three major US indexes closed at the same spot on both Thursday and Friday.
Volume on Friday should have been higher since it was the last day for May regular Options Expiration. Instead, Friday ended with lower volume than Thursday!  That's a red flag for me so I'm looking cautiously at the stocks on my watch list this week. None of my watch list stocks this week managed to meet all of my personal criteria for an ideal watch list candidate. That is a clear indication to me that the market is still not quite ideal for entering a position in an IBD style growth stock.

Here are 3 stocks that made my list this week.  Have a look at them for yourself and you'll see what I mean:

$ANTM
$MLM
$REGN

When possible, I prefer to get a clear confirmation of the intent of institutions.  Ideally, I would like the $SPY to trade above 213 and $QQQ to trade above 109.42.  Also, I'd prefer to see $DJX above 18,289. In addition, I'm looking for volume to be at least 15% higher for 2 days in a row on any of these indexes.  If I see this happen, I will sleep better at night because I'll know that the bulls have won the wrestling match.

Happy Trading!

DISCLAIMER



Do not take a position unless you are prepared to sustain a TOTAL LOSS. Your loss could include the money you invested as well as commissions and transaction charges.


The Information I provide is for education and informational purposes only. The Information provided is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The Information provided is general in nature and is not specific to you or anyone else.


YOU SHOULD NOT MAKE ANY DECISION, FINANCIAL, INVESTMENTS, TRADING OR OTHERWISE, BASED ON ANY OF THE INFORMATION PRESENTED WITHOUT UNDERTAKING INDEPENDENT DUE DILIGENCE AND CONSULTATION WITH A LICENSED PROFESSIONAL. You understand that you are using this Information AT YOUR OWN RISK.