US Market Analysis June 12 2017

After the tech selloff last Friday, the US market is currently at some support levels which hopefully will be able to hold. The long term trend is still up for the 3 indexes. The sell off in tech stocks especially the FANGs have surprised many but those who utilize a simple trend following system would have been able to avoid these stocks.

Despite the sell off, quite a number of stocks are at their 50 day moving average. Which is why when the trading session begins, we want to consider carefully if there might be a bounce up. Some stocks are also conveniently at the rising 20 MA and we will also want to see if we could bottom fish for a quick trade.

Although I write my analysis here mainly using the daily charts and the 60 min charts, I think from now on we also need to insert in some trend following tools and also look at the shorter time frames such as the 15 min charts. Its a bit hard to put in 5 min charts as thing can happen so fast after I publish my research and analysis. But I think you could also do your own short term analysis once you read this latest article I have written How To Avoid Huge Losses In Stocks And Maximize Profits Using One Simple Stock Market Trick.

Its just a simple trend following tool which will help us be on the right side of the market about 75% of the time in the time frame that we want to look at. The combination of a trend following system and a trading setup/strategy will in the long run make a trader come out on top.

Let's take a look at some charts below and I will give you the summary of what to expect at the end.

Stocks that are at or near their 50 MA include:

  1. Apple
  2. ADBE
  3. ADI
  4. AMAT
  5. BIDU

Stock/sector that are at or near their 20 MA include:

  1. SMH
  2. AMZN
  3. ATVI

This is not a buy or sell recommendation but I often look at stocks that are at or near the 20 and 50 MA to look for possible trading candidates. I think perhaps you might want to go through the Nasdaq 100 or S&P 100 and find stocks near these MAs. Then you might want to see how the look like in the 5 min charts.

Here is what the charts above are telling us:

  • The long term health of the major indices are still good. The uptrend has not ended yet
  • The sell off in tech stocks is deemed as a correction and nothing more at the moment
  • The 60 min charts and 15 min charts tell us that it is not conducive to be long stocks for longer swing trades
  • However, the 5 min charts are showing us to look for a bounce which may be good for a day trade
  • Some stocks are at their 20 MA and 50 MA which we want to look at the 5 min charts to see if we can enter for a quick trade
  • Oil is in a 60 min downtrend but reaching an area of support. We want to see if it could go above the 20 MA and 50 MA to start a new uptrend
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