ChartSmarter Tuesday Game Plan 5/27/14

Markets concluded the week Friday with string showings. Both the Nasdaq and S&P 500 rose for a fourth time the past week. The Nasdaq put in a very impressive weekly gain as it rose 2.3% reclaiming its 50 day SMA. Volume however remains tepid. The Nasdaq also looks as if it is climbing above a negative head and shoulders pattern and lets remember when formations break in the opposite way that they should, the potential moves can be powerful. The Nasdaq with this weeks gain is now positive YTD with a scant .2% move. The S&P 500 closed just above the round, psychological 1900 figure rising 1.2% on the week. To me it still looks like it is completing a bearish rising wedge pattern, but that remains to be seen. Perhaps a pop above the big round number next week, in traditionally strong holiday shortened weeks, could be a decent time to start paring positions. But then again I did think that about the Nasdaq. The bullish case can be made about the active option call purchases of the September $205’s. The moribund retail sector produced some decent results with earnings this week, making a case that may the consumer is not so strapped. TIF rose 9% Wednesday hitting all time highs and barely budged Thursday and Friday, bullish action. WSM rose 8% Thursday after reporting, and jumped almost 10% on 3/13 demonstrating good consistency. Now the question is are these just specific well run situations or is the group as a whole in play? AEO put up a weak number but did bounce off the round 10 handle, something to think about. But I remember the days not to long ago when names like WFM and PETM were thought off as best of breed. They now lie 42 and 29% respectively off their 52 week highs.