We bounced today – not too surprising saying how potent and strong yesterday’s down move was. The essential thing to do now is ‘measure the commitment’. What I mean by that is see if we can continue to show strength or if there is early weakness tomorrow and this truly was just a bounce  Do not be in a hurry to short or buy tomorrow morning – wait for the price action to tell you what to do. I will say, if we do trade higher tomorrow look for the hold higher on Monday (that’s the key). If we do see early weakness tomorrow, we could break some lows put in a couple days ago and this sell off may not be over. 

So we have two scenarios for tomorrow – a trade higher squeezing the shorts, or a trade lower as today was just “bounce”. We shall see.

The banks were pretty strong today, but they are still BELOW resistance (hard to buy), so again – wait til the action truly tells you what to do. There will time. Patience is key. 

The tech is still pretty weak. I will go over a couple of the big names below – 

Apple ($AAPL) looks to have formed a BEARISH flag, and if the market roles over tomorrow – short this stock,

Google ($GOOG) also look like it wants lower below the 50 SMA. Nice looking bearish flag there as well. 

Facebook ($FB) went higher today, and then closed lower and formed a very large doji. I do not like to buy off dojis. It is something to monitor though going forward.

Two quick set ups I see for tomorrow IF the market does trade higher — 

Home Dept ($HD) looks like it go to all – time highs if as it has show strength this week. Nice bullish flag.

Monsanto ($MON) Also looks to have formed a nice flag, has shown strength, and is not extended. Looks like it can go higher — if the market holds it together. 

Sorry for how late this is coming out, I have been in NYC today and just got back. See ya tomorrow. 

 

4-4-2013 SPY

Patience – Daily Analysis