ChartSmarter Wednesday Game Plan 4/12/17

Markets never enjoyed the light of the day, ironic with the beautiful weather in NYC today, but they did make decent bounces off with the Nasdaq off just more than 1% in the early going. The tech rich benchmark did bounce nicely off its 50 day SMA Wednesday recording a bullish hammer candle, but one has to wonder if the market is fatigued here. The longer the averages remain near these levels without following through to the upside, the more negative the scenario. It is still early but the Nasdaq is lower by .3% heading into Wednesday and keep in mind this is a holiday shortened week which tend to be positive. If it does lose ground this week it would be the first time in 6 months that it registers back to back down weeks. The S&P 500 also posted a bullish hammer to CLOSE right at its 50 day SMA after threatening to finish below it. For both of the aforementioned indexes it is the second time in last few weeks touching the important line, and another test could prove difficult to hold. The VIX burst through its 200 day SMA this week, a line that was pesky resistance 3 times in last 5 months and its 50 day SMA is beginning to curl upward, a sign that markets can begin to become more volatile. Tech and financials lagged today with the XLK and XLF falling .4 and .3% respectively. The action in the semiconductor space may be sounding some alarm bells as the group lost .8% Tuesday. We all know how NVDA has been behaving but some of the less followed names have been losing their 50 day SMAs recently after trading above them for a a decent period of time. A couple names that come to mind are SANM or KLIC, and they are not far below the moving average and certainly can go on to recapture and look healthy again quickly, but the longer they remain below the more worrisome it becomes. Below is a good example of not front running a trade and why one should await price CONFIRMATION with the chart of SANM and how it appeared in our Wednesday 4/5 Game Plan. Those who tried to get ahead of the move have not been happy, yet.