May 28 Ranging Trend Intraday Trading Update

May 28, 2014: 12:46 PM CST

Price continued its uptrend with a rising range session this morning.

Let’s take a look at our key S&P 500 levels, Sector Breadth, and trending stock candidates for the day.

With a weaker open, price traded down to the 1,908 support level into a positive dual divergence (7:45am PST) which preceded a strong rally back to – then above – the 1,912 high.

Another negative dual divergence undercut the rally and we see price trading within a rising range back to the session highs under 1,914.

Today’s Sector Breadth sends a bearish or cautious message:

Money Flow (Sector Strength) is strongest in the Defensive names of Utilities and Health Care, with Industrials and Energy not far behind.

Our weakest sector today – Financials – was yesterday’s strongest sector (it was a bullish message yesterday and a bearish one today).

Potential uptrending stock candidates include:

Stryker (SYK), Delta Airlines (DAL), ConocoPhillips (COP), and St. Jude Medical (STJ).

Possible downtrending/sell candidates include:

Ebay (EBAY), Rio Tinto (RIO), GlaxoSmithKline (GSK), and DSW Inc.

Caution may be the best strategy as opposed to blind bullishness at the highs.

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Corey Rosenbloom, CMT
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