ChartSmarter Monday Game Plan 2/6/17

Markets put in a very impressive session Friday, in fact it was the Nasdaq’s fifth consecutive Friday advance. Remember the saying it is not how you start but how you finish and as a trend follower I am more enamored with CLOSING prices. The benchmarks are making a habit of starting soft and ending firm, hallmark bullish characteristics. The Nasdaq rose .5% Friday and the S&P 500 added .7% and for the week they eked out fractional gains with the Nasdaq and S&P 500 higher by .11% and .12% respectively. It certainly seems like the averages like what the new president says, attempting to be as apolitical as possible, as the indexes registered firm gains Friday and had plenty of opportunity to weaken through the day. Of course they were energetic with the jobs numbers early on, but they failed to retreat. They actually added to early gains marginally, and four of the five sessions this week CLOSED in the upper half of the daily range. One can make the case that weekly bearish candles were recorded, but the candles have been more accurate in forecasting bottoms than tops. I would have to admit the best acting day this week was Thursday with a strong start, a midday retreat that had the feel of a sell off coming and intraday day it did, but the bulls ended on a positive note with a late rally. The big tech behemoths reported earnings this week and as meatloaf would confess two out of three ain’t bad. AAPL and FB impressed on Tuesday and Wednesday but AMZN failed to deliver Thursday afternoon and Friday it slipped almost 4%. Talking about AMZN we all are aware of what they have done to the retail sector, but are the risks to other groups being under weighed? It surrendered 3.5% Friday as it looked poised to break above a cup with handle trigger of 843.94. Anyone who attempted to “front run” the trigger is going to be in for a painful weekend. Although the stock took a pause Friday one has to wonder if it will to the same to other sectors going forward as it did to retail. Just look at some of the drops in names like DECK RL and HBI and you get the picture after they each reported earnings late this week. Will AMZN inflict pain to the transport sector as UPS failed miserably this week after reporting numbers? They have announced plans to try and improve their services and UPS may have foreshadowed some of that with a weekly drop of 9.4% after an earnings disappointment. Cyber security names look as if they are responding to the wishes of the new administration. FTNT reported a solid release Friday rising by almost 14%. Below is the chart of peer PANW and how it was precisely presented in our Friday 2/3 Game Plan. The flag was taken out and bulls are feeling there is smooth sailing ahead to a measured move of 171.