The Trader Daily

 | Mar 27, 2014 | 7:37 AM EDT  | Comments
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Stock quotes in this article:

twtr

,

goog

,

pcln

,

c

,

wfc

,

jpm

,

bac

,

FB

,

feye

,

bbry

Let's begin by acknowledging the horrid price action throughout the major indices. The price action in biotechs (both big and small), small-cap speculative names (fuel cells) and past momentum favorites like Twitter (TWTR), Google (GOOG) and Priceline (PCLN) has gone from bad to worse. The bottom line is that we've reached a point where either the Russell 2000 or the NASDAQ are going to drag the S&P 500 and DJIA lower, or the S&P 500 and DJIA are going to save the day.

A quick glance at a weekly chart of any of the major indices would lead one to believe that a bullish stick save is in order. I simply don't see anything particularly enticing on the long side. Not yet anyway.

I believe it's best now to recognize that the (short-term) bearish price action in the IWM and QQQ encourages day timeframe participants to adopt a sell the rip mentality in those markets. The SPY and DIA, however, are still stuck in horizontal development (sideways chop). And as such, a notably more responsive approach (fading both strength and weakness toward the multi-day extremes) still makes sense in those markets.

As you can see on the SPY volume profile chart below, I plan to use 185.44 to185.54 as my intraday pivot. As long as the ETF is trading beneath that 10-cent range, I'll be looking for sellers to hammer the stock down toward 184.80, 184.47 and 183.75.

 

5-Minute Volume Profile Es
eSignal

 

Shortly after Wednesday's equity session closed, news broke that Citigroup (C) had their capital plans rejected by the Federal Reserve. Ordinarily, you might assume this is terrible news. Depending on your timeframe, it may in fact be. However, those focused on the day timeframe should consider looking for signs that C is washed out. As long as C doesn't get hammered through 46, I plan to stalk the stock on the long side.

As far as the other major banks are concerned, everything came up roses for Wells Fargo (WFC) and JP Morgan (JPM). They're trading closer to multi-year highs. I will be watching for any early session strength in those names to quickly evaporate. Take a few minutes to review the notes I've made on the multi-bank chart below.

 

Weekly Chart of Four Major Banks
eSignal

 

Since we're talking banks, I want to remind everyone of the massive wall of supply lurking incrementally higher on Bank of America (BAC). Before you get too bullish on BAC, take a gander at the chart below.

Monthly BAC
eSignal

Another stock in the news is Facebook (FB). While I have no interest in dissecting the logic or reason behind the company's recent acquisition of Oculus VR, I do think it's worth noting that the stock has begun to breakdown. I don't actually expect committed bulls in the name to begin panicking until buyers fail to rally around the 52 to 54 area. Several things need to occur for the chart to reverse its currently bearish momentum. And those things are noted on the chart below.

 

 

FIREEYE (FEYE) made its way into this morning's report as a favor to a RealMoney reader. I was asked for a general read on the chart, and so one has been provided. Hint: I hate the chart.

 

 

Our last chart for today is Blackberry (BBRY). This was another reader request, but since it's been on my watchlist as well, I figured it was worth a second look. The bottom line here is that while the stock is currently stuck in the mud, I do believe it has bullish promise.

 

Daily & Weekly BBRY
eSignal

 

Any trading or volume profile related questions can be posted in the comments section below, emailed to me at parkcityyeti@gmail.com or posted to my twitter feed @ByrneRWS

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