Sunday, February 14, 2010

Some Thoughts for the Upcoming Week

I am dead tired after working all weekend painting and doing trim work in the basement as that project comes to a conclusion (just waiting for the carpet) so no video this weekend. I just got through my scans and here are some thoughts for the week ahead.

Bullish Thoughts....
I see some of the old Chinese momentum names starting to form possible bottoms - they are moving higher and look to be rounding out rather than just forming bear flags from which to break down. Example - TSTC has put in quite a run the past two weeks (mostly on heavy volume) and now looks like it wants to form a cup pattern. Other examples - CAGC, HEAT.


The Russell 2000 has outperformed the other indices recently and is the index that looks most like it wants to keep rallying here. It has not formed a bear flag like the others. I always like to see the small caps outperform.


Semiconductors (SMH) has also been a little stronger than the rest of the market and it looks like a possible bottom has been put in place.

The dollar tried to break to new highs Friday but couldn't. If it pulls back further, it would be bullish for stocks.

Watchlist for longs: NOA, VCBI, PCYC, PEIX, CAGC, TCBI, ANN, HUM, CSIQ, ZSTN, FINL, SUTR, RXII, AHD

Bearish Thoughts...

All of the other indices I see still are forming bear flags - S&P, Nasdaq, Dow, NYSE, Transports, Retail, gold, OIH, XLE, and most importantly financials. The charts look like they want to go lower.

After numerous chances to do so this week, the financials could not climb above key resistance, even with the market putting in several days of large gains. This is certainly a negative divergence.

All charts from Telechart, Courtesy of Worden Brothers, Inc.

I don't see a ton of really attractive setups - some are OK but none have me super excited.

Watchlist for Shorts - HXM, SWN, CSIQ, GES, PWRD, GT, OII, UA, OIS, AMZN, DAN, SNA, SNDK, MA, AMSC, MSTR, PNC

Predictions for next week....

If I had to guess, I would say we move higher from here because it seems to be the one that seems the least obvious, and that's just how this market is. I am 100% cash, so I really don't care what way we go - I would just like us to get going already so things would get a bit easier in terms of swing trading. I will keep an eye on things but can't say I will be heavily invested one way or the other. Keep your eye on those financials and go from there I guess.

Good luck this week.

1 comment:

MarshalN said...

Yeah, XLF looks like it wants to hit 13.