Themes I’m Wacthing

I haven’t been writing much lately due to being swamped outside of trading. Trading comes first, and what little free time I’ve had has been dedicated to my homework sessions and trade management. However, I am looking to start writing more frequently again in the coming months. Here are a few themes I have been watching.

The markets have been correcting over the past few weeks, but the intermediate term uptrend ($SPY) remains intact, with a higher high in September (vs April), and as of yet, no new lower low (vs  June). With the market oversold on many indicators and everyone expecting a flush, the market could easily surprise with a strong bounce.

Gold and Silver look like they are starting to resume an uptrend after a very lengthy consolidation. Below is a $GLD/$SPY ratio chart showing that Gold is starting to outperform the general stock market. Notice the ratio is starting to make higher highs and higher lows. This mirrors the action on $GLD and $SLV daily charts. However, it is key that the metals clear their September highs (ratio chart already has) in order to confirm the move.

The giddiness in Biotechs appears to have run its course, but as with all sectors, there are some that still have potential. In the diet pill wars, $ARNA has held up much better than $VVUS and is worth watching. $SRPT is another one worth watching as it consolidates in a very tight range. Watch to see if it attempts to clear the tight range that has formed over the past week.

As we head into the holiday season, $MA and $V are in pretty good shape technically. They have not given up too much ground on recent market weakness and remain near all time highs. Below is a chart of $MA showing it holding above its September breakout as it consolidates. Any strength above $477 could lead to a breakout.

While I am expecting a strong environment to close out the year, I could easily be wrong. That is what trading is all about though, and I think the odds favor a few long shots soon.

Good Trading,

Joey

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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