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3/28/2015 Investment House Report
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Targets hit: None issued
Buy alerts: QRVO
Trailing stops: ALK; NXPI
Stop alerts: AKAM
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Market Summary Video, Plays and Play Videos, and Play Tables with play annotations will issue Monday, Wednesday and the Weekend.
Tuesday and Thursday reports will contain the market summary, chart links to view the index charts, and updated play tables.
Access to all current videos will remain assessable each day using the play links in the reports.
If any market circumstances arise where we see additional plays we want to prepare for the next session, we will of course issue those plays regardless of the day of the week.
- Stocks rebound, though rather weakly.
- Key leadership groups biotechs and chips still struggling.
- Some great upside patterns, but the indices have to see money returning to sustain a new move.
I must apologize at the outset as I have virtually no voice this weekend after being the last holdout in the office against the 'crud' illness sweeping the nation. I thought I was in the clear, ready to sail into spring in great shape, but that nagging little hack Tuesday because full-fledged crud by the weekend. Lovely.
Thus, the report has to be abbreviated in order to stay somewhat cogent in gauging the market. I saved my voice, what little there is, for the plays. The plays we saw developing during the week, and they kept up their work through Friday so they were easy to select. Some interesting upside even as the indices struggled to wipe away the Wednesday selling to close out the week.
Wednesday was the issue. That session saw biotechs and chips, two key leadership groups, take some torpedo hits. The large cap NYSE ironically performed better that session, but that is only because they failed to make a decent move higher prior. The key tell for them was Thursday and Friday; they failed to put together any decent move when the Wednesday pressure subsided, leaving them locked in their ranges, needing a serious catalyst to break them higher.
RUTX, SP400, NASDAQ and SOX fared better, but that is only because they were higher when Wednesday hit. RUTX and SP400 held the 50 day EMA and bounced. They held where they had to and can continue the upside, but they patterns are not outstanding in terms of the recovery thus far. NASDAQ did the bare minimum, hanging onto the 50 day MA, and without some renewed bids is a bit precarious. SOX bounced sharply at the last line of support at the 200 day SMA, but that just got it to the 50 day EMA as it tries to shake off that double top break lower last Wednesday.
To view charts, click on link or paste URL into browser.
SP500 4.87, 0.24%
NASDAQ 27.86, 0.57%
DJ30 34.43, 0.19%
VOLUME: NYSE -10.5%, NASDAQ -17%.
A/D: 1.5:1 NYSE, 1.4:1 NASDAQ
As noted, biotechs and chips, two big rally leaders, really struggled Wednesday. They rebounded Thursday and Friday, but the rebounds were not that convincing.
Biotechs: A big group and some broke their patterns, e.g. CELG, others used the selling to test prior moves, e.g. BIIB, while others used the selling to finish up patterns, e.g. PGNX. On the balance, there was not much of a recovery after the Wednesday selling, leaving this group near term more on the defensive.
Chips: Very similar to the biotechs though perhaps a better recovery in the big names. That didn't mean they returned to good buy positions, just put in bigger reflex moves. NXPI plunged to the 50 day EMA and bounced intraday Thursday and again Friday. Still, however, not great. AVGO may have recovered its form but it will have to prove it. AFOP held the 20 day EMA, bouncing back each time it undercut it. BRCM swan-dived to the 200 day SMA and bounced, but it was no assurance things were okay. This group is quite varied right now, but as with biotechs, near term defensive unless they can show something more.
Internet: One of the leadership groups for the most part still performing. Social still looks quite good, e.g. FB, TWTR. WUBA, LLNW look really positive to move higher.
Many groups are at an inflection point, i.e. they can break higher or lower.
Financials: JPM shows a pair of doji at the 200 day SMA, in position to bounce. C is trying to hold the 200 day SMA but that is problematic.
Retail: Some still solid, others struggling. BWLD has put in a rounded top and last week cracked. CMG is trying to use the 200 day SMA as support but has a lot of work ahead of it. Others look good in the trend, e.g. TJX, COST.
Stats: +27.86 points (+0.57%) to close at 4891.22
Volume: 1.622B (-16.79%)
Up Volume: 1.07B (+218.92M)
Down Volume: 578.05M (-541.95M)
A/D and Hi/Lo: Advancers led 1.41 to 1
Previous Session: Decliners led 1.26 to 1
New Highs: 40 (+20)
New Lows: 45 (-7)
Stats: +4.87 points (+0.24%) to close at 2061.02
NYSE Volume: 742.1M (-10.44%)
A/D and Hi/Lo: Advancers led 1.51 to 1
Previous Session: Decliners led 1.55 to 1
New Highs: 45 (+32)
New Lows: 30 (+7)
Stats: +34.43 points (+0.19%) to close at 17712.66
VIX: 15.07; -0.73
VXN: 16.89; -0.61
VXO: 16.07; -0.53
Put/Call Ratio (CBOE): 1.07; +0.1. Three of four above 1.0 on top of the prior long string of 1.0+ sessions. At least this shows the apprehension remains.
Bulls and Bears: So much for wringing out the bulls. Now the bullishness is running right back up.
Bulls: 56.6% versus 52.0% versus 53.46% versus 58.7% versus 59.5% versus
Not what you want to see, that is bulls spiking back up after a two week slide.
Bears: 1.41% versus 14.3% versus 14.1% versus 14.1% versus 14.1% versus 14.1% versus 15.2% versus 16.3%
Okay, after one week bears fall right back into the rut at 14.1%.
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.
52.0% versus 53.6% versus 58.7% versus 59.5% versus 56.6% versus 52.5% versus 49.0% versus 53.1% versus 49.0% versus 48.0% versus 50.5% versus 56.4% versus 52.5% versus 49.5% versus 51.5% versus 53.4% versus 56.5% versus 56.4% versus 55.5% versus 54.6% versus 47.0% versus 35.3% versus 37.8% versus 45.5% versus 47.5% versus 48.0% versus 52.5% versus 57.6% versus 56.1% versus 52.5%
Background: Last undercut 35%, the threshold for bullishness, in early June 2012.
14.3% versus 14.1% versus 14.1% versus 14.1% versus 14.1% versus 15.2% versus 16.3% versus 16.3% versus 17.4% versus16.3% versus 15.2% versus 14.9% versus 15.8% versus 14.9% versus 14.8% versus 13.9% versus 13.8% versus 14.9% versus 14.8% versus 15.1% versus 16.3% versus 18.2% versus 17.3% versus 14.1% versus 15.1% versus 15.3% versus 15.2% versus 14.1% versus 13.3% versus 15.1% versus 16.2%
Background: Over 35% for bears is the threshold to be really be a good upside indicator. The best indication is when bears cross up through bulls as the two merge. Right now bulls are coming back down from the 60 level that has consistently marked market tops over the past two years. The rapid decline in progress is pushing the bulls/bears lines toward one another. Still far from a cross with bulls falling faster than bears are rising, but bears are warming up to the notion of market weakness.
Bonds (10 year): 1.95% versus 2.01%. Flopping around like a fish on hot pavement, back and forth each session but holding the 50 day MA overall.
2.01% versus 1.92% versus 1.87% versus 1.91% versus 1.927% versus 1.97% versus 1.95% versus 2.06% versus 2.09% versus 2.10% versus 2.12% versus 2.10% versus 2.12% versus 2.11% versus 2.13% versus 2.20% versus 2.245% versus 2.11% versus 2.12% versus 2.12% versus 2.08% versus 1.98% versus 2.04% versus 1.96% versus 1.98% versus 2.06% versus 2.09% versus 2.11%
Euro/$: 1.0898 versus 1.0890 versus 1.0973 versus 1.0925 versus 1.0946 versus 1.0811 versus 1.0648 versus 1.0874 versus 1.0590 versus 1.0568 versus 1.0494 versus 1.0635 versus 1.0546 versus 1.0700 versus 1.0829 versus 1.0849 versus 1.1030 versus 1.1079 versus 1.1175 versus 1.1182 versus 1.1197 versus 1.1195 versus 1.1362 versus 1.1337 versus 1.1385 versus 1.1379 versus 1.1366
No movement on the Friday close as the dollar firmed up over the 50 day MA following the prior week's fall.
Oil: 48.87, -2.56. Backed off from the 50 day EMA test, but still at the higher end of the recent range, trying to make a new break higher.
Gold: 1199.90, -5.00. Still holding the rally up to the 50 day EMA.
$/JPY: 119.086 versus 119.167 versus 119.405 versus 119.72 versus 119.705 versus 120.02 versus 120.855 versus 120.04 versus 121.34 versus 121.39 versus 121.43 versus 121.28 versus 121.50 versus 121.80 versus 121.60 VERSUS 120.72 versus 120.14 versus 119.71 versus 119.74 versus 120.179 versus 119.63
Holding just below the 50 day MA after a three week fade.
Lots of data for the week starting with Personal Income and Spending Monday, checking out ISM and Factory orders midweek, Challenger Job Cuts Wednesday (need to see if it backs off any), and the March Jobs Report Friday. And don't forget, it will be April and Easter month so there will be some confessions of sorts in the form of earnings warnings.
There is also some overseas baggage to carry into Monday. The EU gave Greece's bailout program proposals the thumbs down as too 'piecemeal and vague' to satisfy international creditors. I guess Greece ends up cozy with Russia and Ras-Putin.
Lots of data to factor into the equation along with how the indices left themselves on Friday. Again, no index is in serious jeopardy but the upside has to show more than it did on the Friday bounce in order to sweep away the Wednesday selling.
It is definitely no done deal that the upside once again takes control as it has on just about every other occasion the market tested.
There are still plentiful upside setups ready to go if the market can hold and continue. Of course we want to take advantage of them if they show the moves and the market shows an overall improved bid.
There are some downside as well that can fall even if the market continues higher. These are stocks that are simply tired and showing a loss of momentum after extended moves.
SUPPORT AND RESISTANCE
NASDAQ: Closed at 4891.22
5008.57 is the March 2015 post-bear market high
5132.52 is the 3/2000 all-time high
The 50 day EMA at 4867
The March low at 4843
4816 is the 38% Fibonacci retracement of the February run
4815 is the December 2014 prior market peak
4811 is the November 2014 peak (intraday)
4774 is the January high
4751 is the January 2015 lower high
4631 is the October 2014 upside gap point
The 200 day SMA at 4612
4610 is the September 2014 post-bear market high.
4566 is the lower gap point from late October
4563 and 4567 are the January lows
4547 is the December low
4486 is the July 2014 high
4372 is the March 2014 high
The August low at 4321
4316 is the lower gap point from October 2014
4289 is the July 2000 recovery high
4277 is the March lower gap point
4246.55 is the January 2014 peak
S&P 500: Closed at 2061.02
2062 is the January 2015 lower high
The 50 day EMA at 2071
2076 is the all-time high from November
2079 is the intraday all-time high from November
2094 is the December 2014 high, the prior all-time high
2126 is the lower trendline from 11/2012
2119.59 is the all-time high
2191 is the December 2012 up trendline
2011 is the September prior all-time high
The 200 day SMA at 2011
1991 is the July 2014 high
1972 is the December 2014 low
1905 is the August 2014 low
1902 from early May was the intraday all-time high.
1897 is the prior all-time high hit in April 2014
1883.57 is the early March high.
The December and January highs at 1848
The April 2014 low at 1814
1808 is the November and December 2013 twin peaks
1775.22 is the October prior all-time high
Dow: Closed at 17,712.66
The 50 day EMA at 17,857
17,923 is the January 2015 lower high
17,991 is the early December interim
18,104 is the December high
18,289 is the all-time high
The March low at 17,620
17,351 is the September 2014 all-time high.
The 200 day SMA at 17,323
17,152 is the mid-July post bear market high
17,068 is the early July 2014 peak
17067 is the December 2014 low
16,970 is the June 2014 former all-time high
16,946 is the June 2014 peak
16,736 is the penultimate all-time high from May 2014
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
16,341 is the May low
16,334 is the August 2014 low
16,257 is the January 2014 low
16,179 is the November 2013 peak.
15,855 is the October 2014 low
15,739 is the December 2013 low
March 27 - Friday
GDP - Third Estimate, Q4 (8:30): 2.2% actual versus 2.4% expected, 2.2% prior
GDP Deflator - Third, Q4 (8:30): 0.1% actual versus 0.1% expected, 0.1% prior
Michigan Sentiment - Final, March (10:00): 93.0 actual versus 92.0 expected, 91.2 prior
March 30 - Monday
Personal Income, February (8:30): 0.3% expected, 0.3% prior
Personal Spending, February (8:30): 0.2% expected, -0.2% prior
PCE Prices - Core, February (8:30): 0.1% expected, 0.1% prior
Pending Home Sales, February (10:00): 0.4% expected, 1.7% prior
March 31 - Tuesday
Case-Shiller 20-city, January (9:00): 4.5% expected, 4.5% prior
Chicago PMI, March (9:45): 52.0 expected, 45.8 prior
Consumer Confidence, March (10:00): 96.2 expected, 96.4 prior
April 1 - Wednesday
MBA Mortgage Index, 03/28 (7:00): 9.5% prior
ADP Employment Repor, February (7:15): 212K prior
ADP Employment Repor, February (8:15): 228K expected, 212K prior
ISM Index, March (10:00): 52.5 expected, 52.9 prior
Construction Spendin, February (10:00): -0.2% expected, -1.1% prior
Crude Inventories, 03/28 (10:30): 8.170M prior
Auto Sales, March (17:00): 5.2M prior
Truck Sales, March (17:00): 7.9M prior
April 2 - Thursday
Challenger Job Cuts, March (7:30): 20.9% prior
Initial Claims, 03/28 (8:30): 285K expected, 282K prior
Continuing Claims, 03/21 (8:30): 2423K expected, 2416K prior
Trade Balance, February (8:30): -$42.0B expected, -$41.8B prior
Factory Orders, February (10:00): -0.5% expected, -0.2% prior
Natural Gas Inventor, 03/28 (10:30): 12 bcf prior
April 3 - Friday
Nonfarm Payrolls, March (8:30): 248K expected, 295K prior
Nonfarm Private Payr, March (8:30): 240K expected, 288K prior
Unemployment Rate, March (8:30): 5.5% expected, 5.5% prior
Hourly Earnings, March (8:30): 0.2% expected, 0.1% prior
Average Workweek, March (8:30): 34.6 expected, 34.6 prior
End part 1 of 3
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