ChartSmarter Friday Game Plan 9/2/16

Markets once again finished off session lows but the directional stagnation continues. The Nasdaq closed higher by .3% on the session and the S&P 500 was UNCH. The S&P 500 bounced off its 50 day SMA recording a doji candle and the Nasdaq is taking on the look of a bull flag formation. For the week headed into Friday, the Nasdaq is up .2% and still consolidating near the weekly highs over a year ago the 2 weeks ending between 7/17-24/15 at all time highs. If tomorrow holds around here it will be the fifth consecutive week with a CLOSE in the low 5200’s. The S&P 500 is higher by .1% through Thursday and if that does not hold it will be a three week losing streak which has occurred just 3 times this year. Each time it happened the following week was higher with the weeks ending 1/22, 5/20 and 7/1 rose by 1.4, .3 and 3.2% respectively. Thursday the energy sector saw a late day bounce and at one point was the worst performer with the XLE lower by .9%. The ETF finished down .2% and sliced its 50 day SMA intraday but managed to CLOSE above it. The banks took a rare day off today with the XLF down by .5% after weak economic data was reported making the likelihood of a rate increase softening. The materials were the best behaved group today with the XLB up by .4%. Retail names are beginning to look a bit weak and with crude slumping that is not what one wants to see. Looking at names that have fallen recently following earnings announcements is a long list. There have been some nice upside reactions such as BBY and URBN to name a couple but many have taken a hit after reporting. Names losing double digits recently include GIII, ANF SIG, DSW and DLTR slumping 20.7, 20.3, 12.6, 10.3 and 10%. Leader ULTA dropped 6.1% on 8/26 as well. Below is the chart of TIF and how it was profiled in this Wednesday’s Game Plan this week could offer a good risk/reward entry here following the gap fill today off the round 70 number.