Today we had a consolidation day, do not over complicate it. Price closed flat with some low volume, that is what you like to see on consolidation days. We had a solid three day run, it is hard to buy on the third up day in a weaker momentum tape. As I said yesterday, it is going to be very difficult to short this market as we are in an uptrend and that is not going to change overnight, period – so don’t fight it. (Note to Contarians who are shorting: I do not know how you think you are being contrarian, it sure appears as if the market is powering higher – telling me that most are likely short trying to call the top. The top will come when there are no more top callers.) A plan for tomorrow is to likely do nothing as we need time to consolidate some gains of the past few days, a gap down to support (8 EMA) would be ideal to create a nice high level flag.

Apple ($AAPL) basically took everyone to the “woodshed” in the past 24 hours. If you did not know, Apple had earnings last night and was up as much as 6% before selling off to close negative for the night (in AH). This morning it was down over 3% pre market and then traded higher about 2% during market highs. Finally closing almost UNCH (unchanged). Alot of people were chewed to pieces today and I feel for those. However, the longer term picture is still NOT bullish. The downtrend is still there – do not ignore it.

Google ($GOOG) was strong today and has confirmed the 50 SMA cross. Would be bullish to see if hold higher here now. A hold above the $802 in the coming couple days would be very nice and create a strong momentum level to trade against. 

Banks ($XLF) were pretty strong today, nice action and strength. They could be emerging as leaders again after forming a new base on the weekly timeframe. Would still be better to see a hold above the key level (today’s lows and the 8 EMA) in the coming days to give a less extended price entry.

SemiConductors ($SMH) have been starting to come out of a multi-week base the past couple days and look like they could be ready for a new trade higher. Would like the $35.85 level to hold for 2-3 more days to give a nice bull flag entry.

In closing, alot of things look really well and are setting up for higher prices but currently things are starting to become a little extended and having a couple days of break would not be a bad thing. As always, you can email me (Contact Me page here) or Send me a message on Twitter or StockTwits. Have a good evening. 

4-24-2013 SPY

Consolidation Near Highs – Daily Analysis