Bears Claim Victory Market Update and Trending Stock Scan to End April

Apr 30, 2015: 2:14 PM CST

I’m seeing bears celebrate today’s sell-swing but this is actually the most logical/expected outcome given the divergences and weakness into the new highs.

Before the bears throw a huge party, let’s take a look at the intraday action and focus on a critical level.

Our key focal point is the 2,100 “Round Number” S&P 500 Index level and we see bears shattering this level today.

The initial morning weakness gave way to another intervention buy-swing back to the 2,100 level but this time bears were victorious and the remainder of the session was a continuation of the down-swing already in motion.

For background, here are a couple of quotes from last night’s Member Strategy Report ahead of the sell-off:

A Bearish Wedge – and lengthy negative divergences at the highs – continue to suggest that odds/probabilities favor a DOWNWARD resolution/breakdown here.

Thus we’ll aggressively be short/bearish (or defensive) under [2,100 and] 2,090.

For definition and planning purposes, we’re “dominant thesis bears under 2,100 and 2,080.

Members have daily recaps and strategy planning for the next day ahead.

Let’s see what our Breadth Chart reveals about current market strength (or weakness):

Like yesterday, today’s strongest sector is Energy, boosted by the breakdown in the US Dollar Index (see the prior post on the Dollar and Euro).

All other sectors are weak and under the 50% Breadth level which doesn’t bode well for the market in terms of bullish money flow which was the same picture as yesterday (only today’s session saw continuation of the morning sell-off instead of a true intraday bullish revresal).

Materials is the only other ‘strong’ sector with Energy as all others show strong bearish money flow today.

Be sure to reference the earlier post “What Sector Rotation is Saying so far in 2015” for background and an updated Sector Performance grid on a larger scale.

We have potential bullish trend continuation plays in the following stocks from our scan:

LKQ Corp, Oil States (OIS), Equinix (EQIX), StatoilHydro (STO)

Bearish downtrending candidates include the following stocks from our “weakness” scan:

Generac (GNRC), Yelp, Baidu (BIDU), and GNC Holdings

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Corey Rosenbloom, CMT
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1 Comment

One Response to “Bears Claim Victory Market Update and Trending Stock Scan to End April”

  1. Arjun Says:

    At the moment nothing can be said to be confirmed, as you can see things changing very quickly, so it’s completely possible that the Bulls might win it later, so we need to stay on our toes to keep on making profits. I am lucky to be trading with OctaFX broker, as they keep my performance on track with charging low spread of 0.2 pips for all major pairs; it’s very useful and allows me to trade anytime very comfortably.