“Now how many times have we seen the markets break the uptrend line and then gap up above the obvious stop-loss level for the shorts (Blue Arrow)? Futures are up today, so do not be surprised to have SPX gap up above 1,142 at the open tomorrow.”
SPX didn’t gap open, but it went straight up most of the day and recaptured the Blue Line. No doubt the shorts were squeezed...
QQQQ held support and is back at the top of the recent trading range. I have stops in to buy a breakout. QQQQ has been a laggard over the last few weeks and I would not be surprised if it took over leadership again if the markets can break out of these trading ranges to new highs.
Developed International (EFA) has been lagging, but is now trying to break out of a 4-month trading range. I have seen a lot of laggards suddenly turn into leaders and will have stops in on to buy EFA.
The S&P 500 (SPY) is sitting in a 10-day trading range. I think it will outperform RSP if QQQQ takes over leadership and am looking to add to it.
Large Stocks are still more interesting to me, because we are so far into this rally and I want to own stuff that is very liquid.
I like several Large Individual Names like Visa (V), Hewlett Packard (HPQ) and Johnson & Johnson (JNJ) if they can break out of trading ranges. I have an entire page of other companies that have good potential. I also like how the Emerging Markets and commodity-based Countries are working out.
I am keeping an eye on The Euro (FXE) and the Long US Treasury Bond (TLT). Big moves may be coming real soon in these names, with big potential consequences for stocks.
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