The Closing Print live trading and financial blog during market hours.

Consiolidation this week?

Considering the recent gains in domestic equity indices, we are anticipating some consolidation this week. In addition, the watch list should give you an opportunity to get a good entry without chasing. Most of these stocks should perform as anticipated. To put it another way, we have no intention of chasing stocks this morning; use the TD setup instead.

SPY Daily – Anticipating Consolidation

As long as TICK cumulative climbs, we are bullish. Until the trend ends, we will follow the lead of institutions and their buying habits. TICK tells us they are buying more stocks on the uptick. MACD has crossed and shows bulls are in control and they are doing so on above average volume. We expect that to continue. Price action is above all moving averages (support) and VBP support is building just below, near the 242.00 zone.

Watch List for the Week

The sector heat map is trending towards green, therefore more sectors are viewed as buyable. Currently, the indices and sectors are working together. Arthur Hill put it this way……

“Trading and investing are all about putting the odds in your favor, and chartists can increase their odds with one key assumption: the trend will remain in force until proven otherwise. Coming from the writings of Charles Dow, this assumption means a trend in motion is expected to stay in motion. In other words, assume that the trend will extend, not end. Using a top-down approach, you can incrementally increase your odds of success by starting with the broad market trend, and then extending your trend analysis to the sector, the industry group and the stock. This article will show an example using two classic moving averages to determine the big trend.”

All we need now is for financials to show some bullish flow. Look for these winning stock picks to perform as indicated.

We started a new position in Shopify (SHOP) last week. Pre-market action is trading above recent highs. We will look to add to this position, using the TD setup.

We will wait for the Opening Range, so that we can plot a course for the day. Until then, we are only guessing what institutions plan on doing. In other words, no chasing.

Have a great day.


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