- Stocks mull FOMC further, close with modest expiration gains.
- Indices hold gains for the week.
- Leaders test some, rally some, still look solid.
- Plenty of stocks still in position to follow the market leaders that started the move.
- NASDAQ, RUTX still have to bury resistance.
Stocks started modestly higher, tried to give it up midday pretty much as expected, then started back upside into the close, notching a gain. Not much of a gain, no stamp of verification the upside is here to stay, but a decent low to high move after sellers took their shot in the morning.
SP500 3.39, 0.17%
NASDAQ 8.71, 0.20%
DJ30 25.62, 0.15%
SP400 0.25%
RUTX 0.37%
SOX 0.23%
Volume surged on expiration: +103% NYSE, +35% NASDAQ
A/D 1.3:1 NYSE, NASDAQ
I say sellers, but not many are getting in front of this move even now after 5 weeks to the upside.
CHARTS:
NASDAQ: Up on the session and on the week, but that puts NASDAQ facing its post-bear market high from March (4372), just four points away. That is always a concern. Good move to get there and are investors willing to keep pushing, forging into new highs? Good test before last week's run measured the high so it does have the strength to move through. This week will tell us more, but it does have some big names that can contribute to the upside when they start to rebound.
RUTX: A gain on the week and Friday as well, a move that took RUTX past its January peak. That puts RUTX about 7 points over that high; a very good initial break and improves the probabilities that it holds the move. Still can test before it continues much further; it is after all up six straight sessions.
SP400: Up off the 10 day EMA and a new high on the week. Still plenty of room inside the channel and working well. Not extended.
Sp500: More new highs on the week as SP500 rises, fades, rises fades. MACD breakout as well.
LEADERSHIP:
There was a lot of up and down in leaders and some big volume as well. This quad witching expiration had some volume behind it as positions were shuffled ahead of expiration and the new month. In the end the upside again prevailed with those modest gains.
Leaders were up and down, but we note several putting in nice tests such as STX, TRLA, VIPS, FB, CAVM, RVBD, YY. That opens the door wide for a rebound next week in these stocks. Leaders with nice, low volume, lazy market pullbacks. Very nice combination for gains, and we will be looking at some of these boys again as vehicles to the upside in a renewed rally.
There are also great stocks in position to follow those leaders' footsteps. CRTO, NMBL, LIVE, etc. We are looking at these as well.
OTHER MARKETS
Euro/Dollar: Dollar recovered a bit of ground, holding the 50 day EMA in this two week test of the last run.
1.3600 versus 1.3603 versus 1.3592 versus 1.3545 versus 1.3573 versus 1.3539 versus 1.3551 versus 1.3531 versus 1.3545 versus 1.3589 versus 1.3644 versus 1.3664 versus 1.3601 versus 1.3630 versus 1.3597 versus 1.3633 versus 1.3603
Dollar/Yen: Rebounded some after the Wednesday and Thursday losses after failing at the 200 day SMA.
102.059 versus 101.9595 versus 101.9335 versus 102.13 versus 101.955 versus 102.055 versus 101.735 versus 102.0370 versus 102.335 versus 102.5305 versus 102.540 versus 102.415 versus 102.7395 versus 102.5350 versus 102.365 versus 101.7765 versus 101.775
Bonds: Rebounded from the ugly gut punch selling Thursday, back over the 50 day EMA.
10 year: 2.61% versus 2.63% versus 2.60% versus 2.65% versus 2.60% versus 2.60% versus 2.60% versus 2.64% versus 2.64% versus 2.61% versus 2.59% versus 2.58% versus 2.60% versus 2.60% versus 2.53% versus 2.47% versus 2.47% versus 2.44% versus 2.52% versus 2.53% versus 2.55% versus 2.53% versus 2.51% versus 2.54% versus 2.51% versus 2.50% versus 2.54% versus 2.61% versus 2.66%
Oil: 106.81, +0.76. After the test oil started to bounce just as the pattern said it would. Higher prices on the way again.
Gold: 1316.60, +2.30. Added a bit more after the Thursday surge and break back over the 200 day SMA and the early May high.
MARKET STATISTICS
NASDAQ
Stats: +8.71 points (+0.2%) to close at 4368.04
Volume: 2.454B (+34.54%)
Up Volume: 1.52B (+618.77M)
Down Volume: 1.14B (+238.68M)
A/D and Hi/Lo: Advancers led 1.34 to 1
Previous Session: Decliners led 1.23 to 1
New Highs: 129 (0)
New Lows: 38 (+8)
S&P
Stats: +3.39 points (+0.17%) to close at 1962.87
NYSE Volume: 1.115B (+103.47%)
A/D and Hi/Lo: Advancers led 1.35 to 1
Previous Session: Advancers led 1.34 to 1
New Highs: 291 (+39)
New Lows: 15 (+7)
DJ30
Stats: +25.62 points (+0.15%) to close at 16947.08
SENTIMENT INDICATORS
VIX: 10.85; +0.23
VXN: 12.27; -0.24
VXO: 9.07; -0.15
Put/Call Ratio (CBOE): 0.78; +0.1
Bulls and Bears:
Bulls faded but nothing significant, still holding over 60: 61.4%, still effectively at 5 year highs.
Bears slid a bit more, taking the opposite side of the bulls move, falling below 17: 16.3%
Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.
Note the extreme bullishness: it was this high in 2007 at the crash, in early 2005 as well.
Bulls: 61.4%
62.6% versus 62.2% versus 58.3% versus 57.2% versus 55.1 versus 55.7 versus 54.7 versus 51.6 versus 50.5 versus 54.6% versus 50.5 versus 54.7% 52.0% 54.6% 53.5% 46.5% 41.8% 45.9% 53.1% 57.6 56.1 60.6% 61.6% 60.0% 58.2% 57.1% 55.7% 53.6% 52.6% 55.2% 52.6 49.5 42.3% 45.4 46.4% 44.3% 42.3% 37.1% 37.1% 38.1% 43.3%.
Background: Last undercut 35%, the threshold for bullishness, in early June 2012.
Bears: 16.3%
17.2% versus 17.4% versus 17.3% versus 18.3% versus 19.4% versus 20.6% versus 19.7% versus 21.7% versus 20.6 versus 18.6% 18.6% 17.5% 17.4% 15.1% 17.2% 17.2% 17.4% 17.4% 15.3% 15.1 15.3% 15.2% 15.2% 14.0 14.3 14.3% 14.4 15.5 15.5% 15.6% 16.5% 18.5 21.6% 20.6% 18.6% 20.6% 21.6% 22.7% 23.7% 23.8% 21.6%.
Background: Over 35% is the threshold to be really be a good upside indicator. For reference, bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment. Prior levels for comparison: Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). That was a huge turn, unlike any seen in recent history.
MONDAY
I am celebrating my birthday today and this weekend. When you get to be around 50 you take some time celebrating. Not to mark time, but to forget??? Will focus on the plays as outlined above given they are setting up nicely. Yes bullishness is high and VIX is low (you hear THAT about every hour on the financial stations), but the patterns continue to look very good. As for the economics, the political scene, and the market overview, this weekend I am going to not worry about those items and just focus on the leaders and leave the economics, a frighteningly fertile area for carping and complaining, for another day.
Thanks for understanding!
SUPPORT AND RESISTANCE
NASDAQ: Closed at 4368.04
Resistance:
4372 is the March 2014 high
4416 is the lower November 2012 trendline
Support:
The 10 day EMA at 4331
4289 is the July 2000 recovery high
4277 is the March lower gap point
4246.55 is the January 2014 peak. Key level.
The 50 day EMA at 4227
4131 is the March 2014 low
4104 is the lower gap point from 12/20/13
The 200 day SMA at 4077
4070 is the series of highs from late November/early December
3991 is the prior November 2013 high and the post-bear market high.
3968 is the February 2014 low
3946 is the April 2014 intraday low
S&P 500: Closed at 1962.87
Resistance:
Support:
1920 is the December 2012 up trendline
The 50 day EMA at 1907
1902 from early May was the intraday all-time high.
1897 is the prior all-time high hit in April 2014
1869 is the lower trendline from 11/2012
1883.57 is the early March high.
The December and January highs at 1848
The 200 day SMA at 1818
The April 2014 low at 1814
1808 is the November and December 2013 twin peaks
1775.22 is the October prior all-time high
1768 is the December 3013 low
1738 is the February 2014 low
1730 is the September 2013 peak
1710 is the August 2013 peak.
1698 to 1700 are the July and August interim highs
1687 is the May high and post-bear market high
1685 is the mid-August 2013 upper gap point
Dow: Closed at 16,947.50
Resistance:
16,970 is the June 2014 all-time high
17,104 is a lower trendline off the 11/2012 low
Support:
The 20 day EMA at 16,790
16,736 is the penultimate all-time high from May 2014
The 50 day EMA at 16,636
16,632 is the April 2014 all-time high
16,589 is the December 2013 all-time high
16,506 is the March 2014 peak
16,257 is the January 2014 low
16,179 is the November 2013 peak.
The 200 day SMA at 16,072
15,739 is the December 2013 low
15,696 is the September 2013 peak
15,659 is the August 2013 peak
15,542 is the May 2013 intraday high
15,340 is the February 2014 low
15,318 is the June closing high
15,050 from the August 2013 interim recovery high
14,888 is the April peak and prior all-time high
14,844 is the June intraday low
14,762 is the August 2013 low
14,551 is the June 2013 intraday low on the selloff (14,659 closing)
Economic Calendar
June 23 - Monday
Existing Home Sales, May (10:00): 4.65M prior
June 24 - Tuesday
Case-Shiller 20-city, April (9:00): 12.4% prior
FHFA Housing Price I, April (9:00): 0.7% prior
New Home Sales, May (10:00): 433K prior
Consumer Confidence, June (10:00): 83.0 prior
June 25 - Wednesday
MBA Mortgage Index, 06/21 (7:00)
Durable Orders, May (8:30): 0.6% prior (revised from 0.8%)
Durable Goods -ex tr, May (8:30): 0.3% prior (revised from 0.1%)
GDP - Third Estimate, Q1 (8:30): -1.0% prior
GDP Deflator - Third, Q1 (8:30): 1.3% prior
Crude Inventories, 06/21 (10:30)
June 26 - Thursday
Initial Claims, 06/21 (8:30)
Continuing Claims, 06/14 (8:30)
Personal Income, May (8:30): 0.3% prior
Personal Spending, May (8:30): -0.1% prior
PCE Prices - Core, May (8:30): 0.2% prior
Natural Gas Inventor, 06/21 (10:30)
June 27 - Friday
Michigan Sentiment - Final, June (9:55)
By: Jon Johnson, Editor
Copyright 2014 | All Rights Reserved
Jon Johnson is the Editor of The Daily at InvestmentHouse.com
Technorati tags: stock trading stock market investing Jon Johnson InvestmentHouse.com
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