Stocks Falling Market Update and Trending Stock Scan March 13

Mar 13, 2015: 12:43 PM CST

Divergences can be extremely important in planning and trading intraday market reversals.

Momentum and – as I documented – TICK/Internal Divergences preceded both the support-bounce rally along with today’s sharp fall (sell-swing).

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

First, review Wednesday’s mid-day update for a real-time glance at the lengthy positive divergence at support and note the strong rally (here’s Thursday’s intraday update).

Members also had a deeper discussion of targets, inflection points, and likely price pathways that have been achieved over the last few sessions.

When price did as expected – moving up toward the 2,060 target (and actually peaking into 2,065), we were on guard for another market sell-off due to the lengthy negative divergences that developed into the 2,060/2,065 target points.

In fact, this is a screenshot of a post I contributed yesterday at StockTwits specifically highlighting the divergence:

Use this chart as a reference example of how to track price movements in relation to Market Internals (TICK in this case).

Divergences – and “TICK Channels” – are important in highlighting possible market reversals.

This week gives us great educational examples of this important concept.

Follow me – and many others giving real-time charts and comments – over at StockTwits each day.

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

Today’s Sector Breadth Chart reveals a strong bearish/defensive Money Flow pattern which is typical on sell-sessions like these.

The strongest sector – and by “strong” I mean 18% of stocks are positive right now – is Health Care.

It’s better to see today as a sell session where almost everything is weak – or at least the overwhelming tide is to the downside with selling/liquidation pressure with very few bright spots.

90% of S&P 500 stocks are negative and 97% of the Dow Jones is negative right now.

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

Herbalife (HLF), El Pollo Holdings (LOCO), Anacor (ANAC), and Freescale Semi (FSL)

Potential downtrending candidates exist in stocks showing relative weakness today:

Cameron (CAM), Allegheny (ATI), Continential (CLR), and Oneok (OKE)

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Corey Rosenbloom, CMT
Afraid to Trade.com

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Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).

1 Comment

One Response to “Stocks Falling Market Update and Trending Stock Scan March 13”

  1. Arthur Says:

    The worst possible thing is to go against the trend since it really destroy us in a way that we find it very hard to recover, so that’s why I always prefer to be sure of whether the movement is a trend of just moment and when I am sure I go aggressive and due to OctaFX broker’s low spread which is just 0.2 pips, I can fight easily due to been in profits very early and after that I can dictate things.