THINKING AHEAD - POSSIBLE LONG PLAYS

[huh]

If indices pullback here like I think they may, I'd expect a squeeze back to around the highs after NDX tests it's 200dma and falls below its H&S neckline. This has been the typical squeeze point/pattern since this bull market began. Also, the amount that Naz has fallen since 03/07 is about equal to the anticipated amount of the Alibaba IPO. Could be MM's building cash for their IPO buys.

So I'm trying to think ahead as to what might be some good buys if/when that happens:

GOOG & AMZN: by the time that happens, if it does, both of these should have hit their H&S downside targets. They might be good for a long then & I would expect they will show signs of a bottoming pattern by that time. And about that same time, FB & NFLX should be under their necklines and on their way to their downside targets - possible good hedge plays.

FAS - hard to imagine SPX getting a bounce without banks tagging along.

TSLA - still would like to see this around its 200dma for the first time since, well, ever. Could set-up a bull flag (posted about this in another thread - and that would be the 2nd tag of the lower parallel channel and fill some downside gaps).

MNKD - one of my current favorite potential bullish set-ups. But hoping it can tag some of the lower supports first. (thread & charts here)

IYR - Posted about this and it's 75.75 target back in February. And so far the iH&S is playing out perfectly. I just seem to always lose track of this one when it does pullback.

AAPL - nice bullish breakout recently of a possible 1.5 year iH&S pattern. Not crazy about it breaking out before pulling back further and testing the shoulder test line though. So need to be careful of a possible failure of the pattern, but still a good long with a stop against that happening anyway. I posted a couple charts of this before, but instead of searching for them, here's a current one:



Any other bullish ideas out there?

[huh]

On the flip side, here's my concern if the market doesn't pullback here...

AMZN didn't hit it's downside target of the 6 month H&S pattern. And GOOG hasn't hit it's downside target of it's 3 month H&S pattern. But both are still trading below the neckline.

If the market instead squeezes higher first, I think the market will be doomed. That would be an obvious MM-Mulligan allowing MM's to dump higher before the targets are met. Basically a squeeze. That would be a bad sign. In fact, I think it would set-up for one of the worst summers on record.

GOOG & AMZN would set-up island tops, FB & NFLX would still be within bearish patterns;
IWM would complete the full Right Shoulder of its H&S;
NDX would likely do a head test, and even worse;
SPX would set-up for a parabolic top (hitting a rising wedge's upside target, consolidate, then go on to make a slightly higher high of 2-3% as a final top). That's exactly what GLD did in 2011 with it's high, and how I was able to predict AMZN would do the same last year. And it did. And how I was able to predict NDX topping in early March. And it did. This is also the reason I spent so much time talking about & studying this pattern in the AMZN & Parabolic Tops post.

[huh]

... and a squeeze from here would likely put AAPL's ~630 before failing it's iH&S, making it only a dead cat bounce (FIB retracement).

[huh]

If NDX doesn't close over the current HOD (>3599), then expect a pullback to around the 200dma. If it does, then the squeeze is on. The final squeeze IMHO.

[huh]

May 5, 2014 10:22:26 GMT -5 huh said:

If NDX doesn't close over the current HOD (>3599), then expect a pullback to around the 200dma. If it does, then the squeeze is on. The final squeeze IMHO.

And NDX was able to close over that 3599. This is significant because that is the 76.4 FIB retracement from the most recent 05/02 high (it's actually 3598.50).

I'm still waiting to insure that we don't see a gap'n'crap tomorrow morning, but only because DJI still isn't over the same FIB (sits ~16,562.75), SPX topped at it's same FIB today (1885.51) and COMPQX is still sitting just below the same FIB (4138.57).

Also, DJI still sits under that 14 year resistance, and most importantly NDX hasn't broken above the shoulder test line of it's possible H&S pattern - and it hasn't tested it yet (if it had, I wouldn't be concerned with it). Also, that shoulder test line in NDX sits right around the rising wedge upside target which has served as major resistance/support in the past. So I want to be sure these don't peak there tomorrow with a gap-up and then turn'n'burn (and after filling those other still open gaps from today in XLF & IYT).

But tomorrow is Tuesday, and Tuesday's have been the strongest day of the week this year by far (the last 7 Tuesday's have been green). If this market is going to breakout for new highs, tomorrow would be the most likely day for it to begin.

Here's a quick look at those FIBs marks for SPX & DJI:



...and also for NDX along with a look at the shoulder test & rising wedge upside target lines:

[huh]

Still watching all of these potential long plays. Keep an eye on TSLA. Still a good risk/reward long play anywhere between 172.90 & it's 200dma. The 200dma currently sits ~175.82.

[huh]

May 7, 2014 9:27:37 GMT -5 huh said:

Still watching all of these potential long plays. Keep an eye on TSLA. Still a good risk/reward long play anywhere between 172.90 & it's 200dma. The 200dma currently sits ~175.82.

TSLA reported earnings. So far, knee jerk reaction low AH's was 185.35.