ChartSmarter Wednesday Game Plan 3/1/17

Markets never saw the green of day Tuesday, although the Dow was positive momentarily in the late morning hours. The Russell continues to make waves as the historic lack of volatility in namely the S&P 500, the Russell has now recorded nearly back to back days moving more than 1%. Today it surrendered 1.5% and almost recorded a bearish engulfing day. This type of action could be indicative of topping action, but the trend is in place and remember they tend to persist more than they reverse. For now the benefit of the doubt is with the bulls and the burden of proof remains in the bears camp. The Nasdaq chart is now beginning to emulate a bull flag pattern and a break above 5870 has a measured move of 300 handles. Not a prediction, simply a potential price projection. After taking a day off the utilities and staples groups reasserted their nascent strength with the XLU a clear leader advancing .9%. The week is obviously still young but one has to admire its resilience after last weeks robust gain of more than 4%. Expanding on our earlier talk about things in motion tending to stay that way, it looks like the recent retail strength may have been a dead cat bounce. Names that were hurt Tuesday included TGT which declined double digits after reporting earnings. Its cratering today should come as no surprise as it recorded an ugly 9 week losing streak ending between 12/2-1/27 and now sits 30% off recent 52 week highs (there has been some real destruction in the space as once respected VNCE which was trading near 40 in September of ’14 is now trading less than $2). If one feels pressured to enter a name in the depressed group stick as always to best of breed names. Below is the chart of BURL and how it appeared in our Monday 2/13 Game Plan.