Feb 6 Reversal Market Update and Bull Bear Stock Scan

Feb 6, 2015: 1:40 PM CST

Markets are never boring!  That’s for sure.

What started as a strong, bullish session has now reversed – from negative divergences – to a Rounded Reversal.

Let’s update our key levels, highlight the divergence, and of course note trending stocks today:

On the Unemployment Report, stocks started the session trending higher on a short-squeeze but ended the rally just above the 2,070 level on a lengthy negative Market Internal Divergence.

The afternoon shatter of the 2,070 level set in motion a sell swing and reversal down to create (so far) a Rounded Reversal pattern all the way under the opening price.

The short-term level to watch is 2,060/2,055 which puts us back in the consolidation level of yesterday’s session.

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

Breadth rapidly turned negative on the reversal, shifting from a positive stance to the current negative one.

Only one sector – Financials – is positive today (above the 50% Breadth level) and all others are underwater.

The Utilities Sector has no stocks at all trading positive today – which is strange on a bearish session.

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

If the market holds support, look to play strength in Verisign (VRSN), Linked-In (LNKD), FLIR, and BWLD.

Potential downtrending candidates exist in stocks showing relative weakness today:

YELP, Brixmor Property (BRX), TripAdvisor (TRIP), and Scana Corp (SCG)

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2 Responses to “Feb 6 Reversal Market Update and Bull Bear Stock Scan”

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