Minyanville's T3 Morning Market Call: Rally Broadens on Fiscal Cliff Optimism

By T3Live.com  DEC 19, 2012 10:05 AM

Take a look at the movement in Apple, Western Digital, United States Steel, and more.

 


The market saw a spirited move higher after Monday's strong close as the market rallies on fiscal cliff optimism. All sectors closed yesterday in the green, but the oil services sector was a real standout as it closed the day up over 3%. The indices also closed the day in the green with the Nasdaq (INDEXNASDAQ:.IXIC) closing the day up 1.46%, the S&P (INDEXSP:.INX) up 1.15%, and the Dow (INDEXDJX:.DJI) up 0.87%.

Since the November 16 reversal, the S&P has been stair-stepping higher as it reclaims its key moving averages. This was a powerful two-day move in the indices and in stocks across the board. Most of the tight patterns have triggered and extended. It is hard to chase prices after a 30+ handle rally in the S&P so it would be prudent to sell some of your positions into strength and hold some as you maneuver hedges as we climb higher. 


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Apple (NASDAQ:AAPL) tacked on another day of gains after Monday's 80/20 "Red Dog Reversal."

Apple closed the day up 2.90% as it continued higher after Monday's 80/20 "Red Dog Reversal" entry at $505.58. Since breaking $700, this stock has been in a downtrend with tradeable pivots along the way. The most recent pivot occurred on Monday at $505.58 and the stock was currently up over 25 points last night. The next level of resistance is $536-538 and above that the next level is $555.


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Trades in Motion

Amazon (NASDAQ:AMZN) broke out above the trigger buy price of $255-256. AMZN closed yesterday up 2.58% after stalling at the prior all-time high of $264.11. Overall this stock is strong and saw a nice advance higher yesterday.  


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The financials also tacked on another day of gains on Tuesday. After a potent two-day move, it would be prudent to book some profits and hold some. Last week when Goldman Sachs (NYSE:GS) traded above the prior buy price of $119, traders could have initiated a Tier 1 buy and Monday, once it triggered out of a larger pattern at $121, traders could have gotten up to Tier 2. After this two-day move, traders could get back to Tier 1 and wait for a new entry/set-up before getting back to Tier 2.   


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Western Digital (NASDAQ:WDC) triggered at the buy price of $38.35-38.50. This stock closed Tuesday up over 4% after spending several sessions consolidating the prior move from $34 to $39. The next real level of resistance is $40-40.20.


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United States Steel (NYSE:X) tacked on another day of gains as it closed yesterday up 1.71%. X was highlighted last Tuesday as a laggard play with a decent lower pattern. The trigger buy price was $22.75-22.85 and this stock exploded higher above that level on Friday. The next real level of resistance for this stock is $25.50-25.80.


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Trades on the Radar

Facebook (NASDAQ:FB) has been a bit choppy since putting in a recent pivot high of $28.80. Overall, this stock is hanging around well as it consolidates in a new channel. FB could be basing for another move higher above $28.40-28.88.


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The Oil Services ETF (NYSEARCA:OIH) put in a potent bar to the upside today as it closed Tuesday on highs, up 3.21%. This sector has been largely out-of-play this year as it has not been able to sustain a move higher this year. Perhaps Tuesday's igniting bar could put this group in play, but it needs to build on yesterday's momentum.


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(Compiled by Vicki Haddow (on Twitter and Stocktwits @ChartgirlT3Live).)



No positions in stocks mentioned.