ChartSmarter Tuesday Game Plan 10/6/15

Markets rallied firmly Monday following through on Fridays strong session. The S&P 500 led the way with a 1.8% advance and the Nasdaq rose 1.6%. AAPL the Nasdaq’s largest component was in the red for the majority of the day, so the tech benchmarks resilience was important (let us remember the Nasdaq came nowhere close to retesting its late August lows). The S&P recorded its first 5 day winning streak of the year and it now poised for a test at the round 2000 number which aligns with a declining 50 day SMA. Energy and industrials were among the winning groups and perhaps we are seeing some rotation out of the biotech sector into those aforementioned groups that have been lagging. Some may question the validity of todays move based just upon that, and one looks through the energy names and sees many which have just been destroyed over the last year and change. Names that soared the best on a percentage basis today are stocks well below $10 that were once respected names. They include BAS, CRK, BBG, DNR, SGY and UPL to name just a few. But perhaps we are seeing trend changes and the XLE CLOSED above its 50 day SMA for the first time since May. The same can be said for the XOP and today completed its first 5 day winning streak since January. For those who think the markets are having too god of a time, perhaps the chart from our Monday Game Plan can shed some light on the topic. The stock had no hangover from the weekend Monday jumping more than 3%.