A few ideas

$PZZI announced their CFO replacement today (who already works for the company).  The stock has settled after the shake out with a possible .50 double bottom in the works.  This may just kick off the next leg higher.

GDX has been whipsawing traders of late.  I've been a believer that the metals may be going through a major bottoming process, but it's very possible this is/was just a market rotation that is now over.

We do have a possible 4 point double bottom (I mis-marked the chart) on a daily time frame.  The first low did break, but it didn't pass the BS line.  26 is major resistance.  If it holds and we break the low at 24.65, then the whole gold miners trade will have to be scrapped.  Gold miners would turn from a top five industry group to a bottom five group instantly.  

Last week I shared this DRIV swing trade idea on twitter/stocktwits.  The stock had a false breakdown on investor day.  The stock is slowly but surely working for us and today it broke the black resistance line.  I'm moving my stop up to break even (16.90) and giving it room to work.  

CRR is a very heavily shorted stock in the energy space, it's making very small candles at the spring highs after a sharp sell-off.  The MACD is also making it's first test after a positive cross.  Maybe this can turn around over ~97.  We need to find some reversal signals or we're just knife catching.  

Patience pays

As bullish as the Summers news may be, we are seeing some signs that make us cautious on the markets in the immediate term.  

Smoothed NYMO is nearing the top of the range, but may still have room on the upside

The 5 day new high - new low index continues to lag.  Can this take out the high from July or will it continue to diverge?

Although there are lingering doubts about the rally, big bullish options bets have been made.

TRIN is screaming that the market is getting short term overheated.  The reaction post gap will be telling.

Although this remains a stock pickers market, we need to let things at least cool off before looking for more equity exposure.  If we do this, we have a better chance at creating our own luck. 

Note: did some editing work to improve readability 9/16/13 3:48pm

Top groups update: Financials OUT; Gold Miners IN.

 Shortly after we started the top groups list, Financials have shown relative weakness.  In the last two weeks, it's become clear the strong relative strength up-trends have ended.

XLF confirmed it's relative strength (RS) breakdown, but price is still holding it's uptrend.  Given that and the slope of the RS uptrend, financials still appear to be fine investments long term.  
 

The KBW Insurance index is holding a key pivot line, while breaking a long term RS uptrend.  Again, we see money is flowing elsewhere and it's not worthy of a top group recognition at this point.

The KBW bank index is at a key level after forming a rising megaphone pattern.  Generally these forecast a trend change.  The RS support line will tell us a lot.  Maybe this will just muddle along for awhile?  Regardless, we know it's not top group worthy.  

So what do we replace financials with??  There are some good candidates out there as emerging markets in Asia and South America are starting to see some investment inflows.  The old adage investors make bottoms appears to be playing out again.   

That said, we're going with gold and gold miners.  You can see both have broken sharp resistance lines and are ALL forming price and relative strength head and shoulder bottoms.  We'll gladly trash this idea if gold miners lose the rising support line around the 25 level.  

You can play this a ton of ways.  NUGT is the 3x bullish gold miners ETF.  ABX, NEM, KGC, AUY and AEM basically track GDX.  The best stock play in the whole group might just be AGI.

This is one of the few gold miners above the 200 day moving average and it's traded sideways while other miners pulled in.  Note ~20 is heavy resistance, but that's nearly 20% away. 

Good Luck out there!