Many of the market indexes are currently hitting critical support levels. If these levels break, we could see lower prices. The recent decline after the presidential election is finally being digested. It was the worst decline after an election in history. Since many stocks are at critical support points, I am currently 100% in cash.
The DJ-30 finished with a doji at 12,815 meaning indecisiveness, but hit support at the critical 12,750. Next week should set the trend more on the direction.
The NASDAQ Composite (COMPQX) is also hitting critical support levels at 2,900.
US Dollar Index (DXY0)
The USD is still holding above that 80.30 level of support. Remember when the Dollar bounces, it effects energy and commodities such as X, FCX, GLD. UUP is another Dollar index.
ETF's are also at some crtical points.
The EEM's are consolidating in this basing pattern, but volume is pushing it to the negative side.
FXI (China index) is staying above the 35.50 level and seems to be supported okay for the time being, time will depend on how long the market corrects if this one can stay up.
QQQ Weekly chart is also pushing to the down side with above average volume - breaking the 200 day this week on heavy volume.
There were a few stocks that caught my eye on Fridays session. Many stocks as mentioned earlier are at those interesting levels and are pulling back fairly heavy. However, remember that when stocks pull back it creates great opportunities and new chart patterns. It is healthy for the market. Just don't ride the stocks down. Wait for the market to setup.
Cognizant Tech (CTSH) still holding above this support line, but pushing downward. It's possible it may look to fill the earlier gap from 8/6/2012.
Disney (DIS) tanked on heavy volume after it matched EPS estimates, but falls shy on revenue expectations. It was supported at the 200 day, but still very negative. Some people are setting up trades to get into the stock at 45 dollars with options. My opinion - let this one digest for a bit. Duke Energy (DUK) this stock is toast. The chart is broken, let the chart setup.
Ecolab Inc (ECL) - created a flag pattern, and pulling back slightly now. Something to watch though if it can hold. Hess (HES) after doing a consolidation the last month in this triangle pattern, it finally broke the support line Friday on heavy volume. I mentioned to watch this one early in the week.
Johnson & Johnson (JNJ) - pushing on the support line. We need to see what happens on Monday, but it has been pulling back the last few weeks after breaking out on 10/17/2012.
Limited Brands (LTD) - Holding at support but below the 200 day. Also at a critical point.
McDonalds (MCD) - continues lower after mentioning this one on Thursday. Again on heavier volume, looking for slightly more downside on MCD.
Marathon Petroleum (MPC) - After the pop 11/6/2012 this stock along with the other oil and petroleum stocks continue lower. Its pushing now to the negative, but still holding on to support.
Motorola Solutions (MSI) had multiple basing and flag patterns the last few months. Still holding its flag pattern for the time being.
Netflix (NFLX) - creating a flag pattern as well.
Precision Castparts (PCP) keeping up above the support level of 169
Travelers Companies (TRV) - Also at support levels. Watch it to break lower.
Alexion Pharmaceuticals (ALXN) - Holding up above the 87 level. One day does not make a trend though. Lets see what happens Monday.
Amazon (AMZN) - Dropping lower below this 230 support line. Im staying away for now.
Autozone (AZO) - Dropped back into this triangle pattern and was not able to be supported above it.
Chipotle (CMG) - Filled the gap but was not able to make it through the 280 level. Going back down to retest things.
Author: Sasha Evdakov
Sasha is the creator of the Tradersfly and Rise2Learn. He focuses on high-level education speaking at events, writing books, and publishing video courses on business development, internet marketing, finance, and personal growth.
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