Week of May 23, by John Person

Transcription

1 Weekly Thoughts Week of May 23, 2016 by John Person

2 Weekly Positive Thought: Choose a job you love, and you will never have to work a day in your life. - Confucius Market Thoughts & Observations: Welcome to the last full trading week of the Month of May! Congrats to those who picked up the buy trigger in the biotech ETF ($XBI) based on last week s analysis. Granted it s not a retirement trade but from the buy trigger on Monday at to Fridays close at it was a 3% gain. If you missed it here were my direct quotes Biotech s have not performed positively, at least not just yet, but you should be watching for a daily PPS buy in both $IBB as well as $XBI, the sector ETF s for long triggers. Also watch $XBI for a daily close above $52.70 to trigger a long entry. In addition to illustrating this on the chart I also pointed out from a seasonal trend perspective Biotech s ($IBB), Semi-Conductors ($SMH) and System Software Stocks tend to rally in the month of May. I encourage traders watch for intraday (60 minute) and End of Day PPS buy signals in ($AKAM, $CA, $AVGO, $CSCO & $INTU) just to name a few. The reason this is ironic is these were the more positive stocks last week, which we both covered during Mondays live Weekly Planning & Scanning session as well as Tweeted out on May 9th. I don t want to get your hopes up too much but we did form a weekly bullish High Close Doji long trigger last week as well. This could trigger a move back up to at least the $58.50 level by mid-july.

3 М M Since a majority of retail traders use MACD and Stochastics and now I see more institutional traders who have gone through the Market Technicians Ass. CMT program are giving more and more references to both Stochastics and MACD indicators. With that said let s look at what they would be seeing in the graph above. Clearly MACD has a positive histogram component and both moving averages are moving in an upward slope indicating a bullish bias. Stochastics is at the 50% level and this is where my work with George Lane back in 1980 pays off. Markets can launch from a %K- %D cross over from that 50% level and ignite a bullish buy signal. 50% reading is a neutral level. Bears should be on guard. My indicators reveal we have a high probability trigger to go long and seasonal studies suggest this is a strong period for this sector. What to do next? If bios and semiconductor s continue to impress a positive momentum move that the QQQ s will stand to see the move I m expecting, that s why I am still in the opinion based off of the technical outlook and my indicators and scans a daily close in the QQQ s above should give a momentum breakout trade as the next stop should be where there is a gap in the daily charts coincidently at the April 20ths lows as the graph below shows B

4 Crude oil can bounce around between and 50.00, with a chance for a move up to over the next two weeks or so. One reason is small speculators added to their short position last week. In addition, I am not looking for gas prices to ease ahead of the long weekend. I am expecting a bounce for equities, not because I am a contrarian but due to the analysis explained by the technical points below, plus two more observations, small specs are still net short in the Emini S&P s and more importantly, the High Yield Growth index ETF ($HYG) (as we have discussed in the trading room) appears more supportive (see chart below). If that s the case I would expect Stock Index s to hold up as well. Note the overlay of the S&P 500 as a black line on the candle chart of ($HYG). Now granted there s not a 100% correlation like for every tick up or down, but it does have a strong trend correlation. The technical picture on ($HYG) based on my indicators and the OBV looks like this market wants to reach the Persons Quarterly pivot resistance level at $85.75 area. That s would translate to test last year s highs B 1.23B Last week many sectors improved their respective price performance off of their weekly lows. Yes we did see a dead cat bounce in consumer discretionary sector namely apparel as expected, and more importantly Walmart s performance. But we are not in that really defined environment where you can blindly buy or sell any one particular stock or sector. Case in point is retail apparel has been decimated. But not all stocks, look at American Eagle Outfitters ($AEO) as they demonstrated with a 16% surged move up for the week. Now for this coming week we have a ton of consumer discretionary retail stocks out like Tiffany s ($TIF) and Signet Jewelers ($SIG) and Movado ($MOV) but we also have more apparel stocks out with earnings like Express ($EXPR) and Guess ($GES). Guess formed a daily HCD pattern and the weekly charts and seasonal studies show it can pop from here. So if I had to guess which stock might rally, even though I only remember the Brooke Shields blue jean commercials, I still have no idea who what or where they market too., then I would say this company has a shot for a surprise upside move. 19,32 19ю11 17ю M 4.485M

5 Technical Points of Interest: l All top 5 stock indexes are in a daily PPS BUY mode ($SPY, $IWM, $NYSE in HCD s) l All top 5 stock indexes are in weekly PPS SELL mode but $SPY, $DIA, & $NYSE formed Doji s. l All stock indexes are closer to their respective Monthly Persons Pivot support targets. l Only the $SPY & $NYSE Weekly Advance /Decline comp. levels are all above their M/A s. l Weekly McClellan Osc. at +159, the daily reading at -93 a daily positive zero line cross is bullish. l S&P 500 has 262 stocks above their respective 50 day Moving Average versus 256 last week. l We have Seven sectors now negative on the year compared to 9 for the last two weeks. l CFTC COT Data shows small specs short 11.7% of open interest in Emini S&P s

6 As a follow up on Gold it did form a bearish weekly Low Close Doji on heighten volume in a seasonally weak period. Monthly support is 1234, with the lows of April 29 at A weekly close below both these levels project a washout back towards area by mid July, which would equate to a 4% move Special Announcement: In the last two years I have experimented with alerting to specific trades specifically the HCD & LCD triggers. Many of you (especially those in the trading room or who have read my books) know that these two signals give the action to take for the entry, where the stops belong and the holding period to see expected results. Therefore I do not put out the actual entry, stop and exit price levels, mainly as many of you trade options and prefer either a stock replacement or option writing strategy, in addition we cover this in Mondays Planning & Scanning sessions. The reason to send Tweets was it was a great form of communication without interference from internet spam police or other technological issues. As we move forward in time, I will only be sending Tweets to alert of s as many of you have requested I go back to that form of communication. What we will be doing to make this a superior advisory service is to send test s and then you need to make sure they are: Timely and not hung up in cyber space Come through and not get hung up in your spam folder. I will be implementing this process by the end of the second quarter( next month) and therefore you will be getting these exciting trade alerts that have populated up all year. Case in point was Identifying all the computer software stocks a week ago and then the biotech s last week. So for example the Tweet sent on Monday the 16th at 3:12 PM that stated Traders observation; top stock indexes only rally back to 20SMA $SMH $IBB $XLK trigger PPS daily buy signal but $FB flashes daily PPS sell. What this would better accomplish to those looking for this information would be translate to mean Stock Indexes are at a resistance level but Semiconductors, Biotech s, and Technology ETFS are in a buy mode and Facebook generated a daily sell signal. This is a follow up of what was written in this weekly commentary and If given to the subscribers and trading room members you will be a better informed that what we wrote about is happening and now we can act to look at specific trades in order to profit. I guess it comes down to the fact I m keep the analysis contained in-house to subscribers only and I will communicate to you by . Thank you very much, I feel this latest development will be a great value and serve you best in the months to come. All the best to everyone this week, and here wishing all of you a very Happy Memorial Day Holiday. Please remember to give thanks, a moment of gratitude and a prayer to those who gave the greatest sacrifice to our country. Sincerely, John L. Person PS. Next week s issue will not be available until Tuesday due to the holiday.

7 Seasonal Spread Trades: Buy Dec. Cattle / Sell June Cattle: About 4-10 liquidate before 5-20 Buy August Soymeal / Sell August Soybean Oil: About 4-24 liquidate before Buy Sept. Corn / Sell Sept. Wheat: About 5/12 liquidate before 6-17 Buy Dec. Nat Gas / Sell July Nat Gas: About 5-14 liquidate before 6-28 Buy August Feeder Cattle / Sell Dec. Live Cattle: About 5-16 liquidate before 6-11 Buy March Cocoa / Sell July Cocoa: About 5-19 liquidate before 6-14 Buy Dec. Corn / Sell July Corn: About 5-21 liquidate before 6-29 Buy August Soymeal / Sell March Soymeal: About 5-23 liquidate before 7-11 Seasonally Strong Stock Sectors for May: $BKX, $XLV, $IBB, $XTL, $XLP, $XOP, $UNG Seasonally Weak Stock Sectors for May: $ITB, $XLI, $XLB, $IYR, $XLU, $IYT, $OIH, $XLY Bullish Weekly HCD Signals: Tech: $STX Bio Tech: $XBI, Insurance: $AIG Brokerage: $ETFC Energy: $WMB REPORTS & EVENTS: Monday: Crop Progress 4:30 PM Tuesday: German GDP 2:00 AM, Redbook 8:55 AM, PMI Mfg. Index 9:45 AM, Richmond Fed Mfg. Index 10:00 AM, API report 4:30 PM, Wednesday: Mortgage Aps. 7:00 AM, Int. Trade 8:30 AM, EIA Petroleum 11:00 AM, Fed Head speaks 1:00 PM, 5 yr. Note Auction 1:00 PM Thursday: Weekly Jobs 8:30 AM, Durable Good 8:30 AM, PMI services 9:45 AM, Pending Home Sales 10:00 AM, Nat Gas report 10:30 AM, KC Fed Survey 11:00 AM, Fed Speaks 12:15 PM, 7yr Note Auction 1:00 PM Friday: GDP 8:30 AM, Consumer Sentiment 10:00 AM, Janet Yellen speaks 10:30 AM Earnings: Monday: BLBD Tuesday: AZO, BBY, CSC, DSW, HPE, INTU, KIRK, TOL, VAL Wednesday: EV, EXPR, GES, LGF, NTAP, PLKI, PVH, TIF, WSM Thursday: ANF, BURL, CHS, DECK, DG, DLTR, FRED, GME, MOV, PANW, PDCO, SDRL, SAFM, SIG, ULTA Friday: BIG, JKS Bearish Weekly LCD Signals: REIT s: $HCP, $BXP Industrial: $MMM, $UTX Utilities: $PCG, $PEG Internet: $PYPL

8 For advanced trading training, resources and proven systems, visit personsplanet.com John Person President of John Person Inc dba PersonsPlanet.com worldwide known for his unique use of Pivot points and candlestick charting, also known as Person Pivots or PPS on TD Ameritrade / Tos platform, John provides online trading education for a beginer or advance traders with his University Program and daily trading room, John Person offers research for active stock and options traders with newsletters, trading software, trading seminars, forex trading systems, trading course, books using advanced technical analysis on candlestick, pivot points, fibonacci and indicators.