Saturday, April 25, 2015

The Daily, Part 1 of 3, 4-25-15

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4/25/2015 Investment House Report
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MARKET ALERTS:

Targets hit: BBY
Buy alerts: DGLY
Trailing stops: None issued
Stop alerts: BWLD; PGNX; SN

The market alert service is a premium level service where we issue intraday alerts relating to the general market conditions, when stocks hit action points (buy, stop, target, etc.), and when we see other information impacting the market or our stocks. To subscribe to the alert service you can sign up at the following link:
http://www.investmenthouse.com/alertdaily.html

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The Market Video is DIVIDED into component parts: Market Overview, Economy, Technical Summary, and the Next Session. Choose the segments you are interested in without having to search a longer video. Click on the link to the portion you wish to view.

TO VIEW THE MARKET OVERVIEW CLICK THE FOLLOWING LINK:
Flash: http://investmenthouse1.com/ihmedia/f/mo/mo.mp4

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The REPORTS SCHEDULE is as follows:

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.

MARKET SUMMARY

- NASDAQ, SP500 move to new highs rising four large cap stocks
- New highs but less than impressive action overall as smaller caps do not participate. Most stocks don't participate.
- Lack of Durable Goods orders, lack of capital investment. Still.
- Feds kill TWC/CMCSA deal, and may have again marked the top of a market and economic expansion.
- Time again for some Greece headlines and worries to dog the stock market
- New highs, but not a clear and away blastoff. Leaders still there but some are under some pressure.
- Playing the upside, with some downside, but watching for 'in your ear' as NASDAQ approaches the March 2000 all-time high.

A very mixed Friday, and frankly that is better than some of the possibilities given the run higher to this point and the crescendo of excitement over the AMZN, GOOG, MSFT, and SBUX earnings. NASDAQ and SP500 dutifully moved to new highs though NASDAQ still missed out on the March 2000 all-time high by 40 points. Good to see they avoided a gap and crash. All of the market, however, did not participate.

RUTX and SP400, the small caps and midcaps, did not participate. They started higher with gaps, but didn't have the staying power. Hey, it was a large cap session, pure and simple. The smaller caps are still trending nicely after getting the rally started, now taking a back seat. Hmmm. They kind of did this in the February move as well: broke higher first, got investors ginned up, then everything went higher.

SP500 4.76, 0.23%
NASDAQ 36.02, 0.71%
DJ30 21.45, 0.12%
SP400 -0.41%
RUTX -0.31%
SOX -1.66%

VOLUME: NYSE -8.8%, fading just below average on SP500's move to a new high. Not a plunge in volume, but volume was not exactly explosive on the move higher. NASDAQ trade +2.3%. Not bad given the break to a new all-time closing high, but solidly above average again and rising over the volume on the Thursday gain.

A/D: Definitely shows the large cap nature of the move. More than that, it shows how just a few stocks orchestrated the move to new highs.

NYSE, just over 1:1. NASDAQ actually negative at -1.1:1.


It looks as if a transition, for now, has taken place with the small and midcaps leading the initial move and now the big cap stocks taking over. All, however, are holding up well as the small and midcaps are in very good trends, perhaps not leading with blasts higher, but steadily climbing.


NEWS

Durable Goods Orders remain less than durable.

Durable Goods Orders, March: 4.0% versus 0.5% expected versus -1.4% prior.

Wow, how great. Not. A 112% gain in defense aircraft orders accounted for the surge.

Ex-Transports: -0.2% vs +0.4% expected versus -1.3% (from -0.6%)!!!

Non-defense capital goods ex-aircraft: -0.3% versus -2.2% (from -1.1%)!!! Seven months down.

History: this length of declines in durables and investment has equaled recession. Not good.

But, the soothsayers stand firm. From CNBC: "Business spending on capital goods has been undermined by a buoyant dollar, which has eroded profits of multinational companies." Oh, I guess that explains the weak investment FOR THE ENTIRITY OF THE 'RECOVERY' when the dollar WAS NOT strong. This kind of casual, nonsensical 'reasoning' is dangerous because most people don't think, just accept the nonsense as fact.


Heavy Hand of government kills TWC/CMCSA deal. Shades of MSFT?

Friday TWC announced the attempt to acquire CMCSA is over thanks to the DOJ informing the companies it was going to sue to block the deal based upon anti-trust grounds. Once again the government is applying yesterday's standards to the new world, failing to grasp what is happening, or perhaps simply giving favors to those who give the money. Look at the Clinton allegations. Look at the Bush allegations that are leaking out ahead of the book. It is not a flattering look at our 'leaders,' and indeed is looking criminal in nature. Democrat or Republican, it is not looking good for our nation.

Beyond that, what about the market impact? Friday was up on some big earnings but the move was very narrow. Why didn't every stock participate in the good news?

Perhaps this is a seminal moment. JUST as NASDAQ breaks to a new all-time closing high with an assumed all-time high coming this week, the federal government announces a major stance in corporation combinations, combinations planned to help preserve the corporations in an environment rapidly changing for companies providing video to consumers. Cable is under fire from wireless streaming. This merger was an attempt to remain competitive with the rise of wireless and streaming.

Just as the federal government sued MSFT as its domination was peaking back in the 1990's, something it has not recovered from until just about now, the feds are moving to assure cable becomes obsolete. Perhaps the government wants to control it for some reason. Perhaps, as noted above, it has friends in other places (check out the number of visits GOOG officers visit the White House) and wants to make sure they are properly paid back. This block falls right into their game plan.

That peak did not only stop MSFT, it helped stop the tech innovation advance. We fell into an investment and technology recession for several years, sending hundreds of thousands of our best technology jobs permanently overseas.

Thus, even as the stock market breaks to higher highs, the move was less than well-attended by the rest of the market, suggesting that the regulatory cold water thrown onto a deal designed to at least give cable a chance to compete in the new wireless and streaming world is viewed as an attack on ANY kind of combinations ahead. THERE ALREADY IS NO INVESTMENT IN THE US, and the federal government appears to desire to keep it that way.

This move was labeled 'political' by nearly every financial news outlet. It is. Pure and simple. That won't change a thing, however, for the next 20 months. Overregulated, overtaxed, and given no options to expand.

Indeed, tax revenues as a percentage of GDP are almost at 18%. When they move past that level we get recessions. Why? Because the government has so increased taxes, fees, fines, etc. that too much money is taken from productive use to the waste of government. When that happens, recession.

Starkest recent example? The surpluses of the 1990's. We were told that the Clinton tax hikes 'had' to be passed to cover spending. What happened was the tax hikes, as they always do, as they did now, result in more tax revenues. Initially. That pushed revenues well past what was 'needed to pay for our deficits' to massive surpluses. Instead of giving that money back by lower taxes, tax increases were maintained, and the money was uselessly used to pay off our debt. What did that get us? Recession. Too much money taken from the economy and no investment was made. We turned to recession because of no money to invest.

We quite possibly are ready to go into recession again because revenues are so high and we know no capital investment in equipment, people, etc. is being made. With the feds telling the world they will block attempts to survive by merger, there is even LESS incentive to make capital investments and a recession becomes inevitable.


Greece: EU negotiators tire of Greece counterpart. Reports are they are 'hammering' him, accusing him of delaying tactics and being amateurish.


THE MARKET

CHARTS

NASDAQ: Gapped to a new closing high, 32 points from an all-time high on the high. That is all it did. Gapped, closed a few points lower. SBUX, AMZN, MSFT, GOOG. That pretty much tells it. Now 40 points from the all-time high at 5132 hit March 2000. Broke out from its 9 week pattern very similar to its 10 week pattern that broke out in early February, leading to a month-long run. Perhaps it is doing the same now, rallying one more time before the summer hits and the doldrums set in. Don't forget 5132, however. Recall we discussed that as a possible top for NASDAQ back in March when NASDAQ traded over 5000. Have to watch for sharp reversals when NASDAQ tries that level this coming week. After turning back below that level on the last attempt, we doubt NASDAQ will turn back this time before hitting it. After that, the index and the rest of the market has to show it can continue with a February-like move.

SP500: New all-time closing high by 0.30 points. While just a whisper of a new high, SP500 did hold a breakout over the upper trendline of its 9 week pattern. Same length as the prior pattern that led to the February run. All of the caveats for the NASDAQ apply here, and indeed how NASDAQ reacts to the prior all-time high will impact how SP500 and the other indices play. Pretty weak volume on the breakout, and that is something of a disappointment.

SP400: Gapped higher, in new high territory (again) but could not hold it, slipping to a modest loss. Holding over the 10 day EMA and still in a very nice uptrend, but that was a very short foray to a new high, somewhat akin to RUTX' move a couple of weeks back. Again, however, an excellent trend higher remains in place, just want to see it put more distance on the prior high.

SOX: A key index and move. After defying the pattern and riding the back of LRCX and BRCM upside through some pretty stiff resistance, SOX gapped lower Thursday on the TXN earnings plunge, but managed to hold the 50 day MA. Friday it did nothing of the sort, collapsing through the 50 day EMA and the mid-April lows. This could be an epic failure, rolling over just as NASDAQ and SP500 reach for new highs. SOX is an important index for the market. Its breakout from a decade-plus trading range in January 2014 and its successful test in October of that year was a major boost for the overall market. If SOX rolls over, NASDAQ could indeed have an issue after it makes its prior all-time high and nudges it aside for the record books.

RUTX: Backed off from the Thursday gain similar to SP400, also holding the 10 day EMA on the close. Still a very good uptrend in place, but note it did not run right back up to that level after the prior Friday flop. It would appear there was some rotation out of the small caps after that event as the large cap NYSE and NASDAQ indexes break to higher highs.

DJ30: Impressively weak session given the hoopla re MSFT earnings. Indeed, without MSFT's gain, DJ30 was red on the day. Still no breakout from the pattern. No attempt at it even after the higher low from the Tuesday low. Nice pattern, but as we say, just a pretty picture until it makes its move, and it has not made its move.


LEADERSHIP

Of course the large cap 'names' posting earnings investors found pleasing led the move upside. Thanks to them the market was positive. Without them, narrow breadth, weakness in small caps, midcaps, chips, and 'old economy' Dow stocks would have the overall market lower.

Big Names: Others moving as well. AAPL modestly higher. PCLN gapped higher, continuing its move. EBAY held its upside gap from Thursday. CSCO up modestly.

Chips: Even the good movers from early in the week struggled. BRCM has almost fully filled its big upside gap. LRCX has faded off its earnings gap, but is showing a nice doji at the 200 day MA. AVGO posted a good move Wednesday, but that was all; Friday it blew out the 50 day MA to the downside. NXPI did the same and ALTR warned. SUNE, a very impressive chip with a great uptrend, is threatening that trend. The chips are down right now.

Software: A so-so day, but that is not bad after the moves. SPLK showed a hangman doji after a great Monday to Thursday break higher. CYBR was flat after a huge week has it near the mid-February peak. FEYE jumped higher but fizzled to flat. CRM gapped upside after a good Thursday move but could not hold it just yet.

Metals: SID, after a big Wednesday and Thursday, gapped to a hangman doji. A really solid 2 weeks with a breakout, test, and a renewed surge. FCX gapped back upside after its earnings took it to the 50 day MA. AKS gapped to a doji after a good Thursday bounce. These look good.

Energy: Did a good job of testing on the week, setting up the next move. Thursday it looked as if some moves started, e.g. APC. A bit of a fade Friday by that stock and others, e.g. HAL, PTEN, GPOR. HNR, KEG look great to break higher.

Telecom: With the TWC/CMCSA deal withdrawn, telecom was seen as a beneficiary. MOBI surged 8.8%. Others such as S, VZ were up the last part of the week on this speculation.

China: Some good moves yet again, but some not. NTES surged. JD up again along with NOAH. SOHU surging. VIPS, however, struggled Friday and looks heavy in its trend, flopping hard at the 20 day EMA.

Financial: JPM, C, STT are testing fairly nicely after good moves.

Miscellaneous: DDD warned and gapped hard to next support. FB still looked weak. TWTR is feeling some of that effect. MNST is breaking higher again after its flat gap test. QRVO sold hard to support.


MARKET STATISTICS

NASDAQ
Stats: +36.02 points (+0.71%) to close at 5092.08
Volume: 1.848B (+2.31%)

Up Volume: 901.72M (-178.28M)
Down Volume: 975.53M (+217.94M)

A/D and Hi/Lo: Decliners led 1.14 to 1
Previous Session: Advancers led 1.55 to 1

New Highs: 131 (-8)
New Lows: 34 (-9)

S&P
Stats: +4.76 points (+0.23%) to close at 2117.69
NYSE Volume: 767.4M (-3.79%)

A/D and Hi/Lo: Advancers led 1.03 to 1
Previous Session: Advancers led 2.08 to 1

New Highs: 97 (-16)
New Lows: 8 (-3)

DJ30
Stats: +21.45 points (+0.12%) to close at 18080.14


SENTIMENT INDICATORS

VIX: 12.29; -0.19
VXN: 14.2; -0.02
VXO: 12.5; -0.18

Put/Call Ratio (CBOE): 0.76; -0.27


Bulls and Bears: Bulls tumble, bears still holding fast.

Bulls: 52.5% versus 50.5% versus 50.4% versus 54.5% versus 56.6%

Bouncing back up after a couple of weeks of flat line. Still not enough of a drop, but with stocks running, typically that won't happen.

Bears: 15.2% versus 13.9% versus 14.2% versus 14.2% versus

Wow, has the dam finally broken with a 'massive' move to 15+%?

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.




Bulls: 52.5%
50.5% versus 50.4% versus 54.5% versus 55.6% versus 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% versus53.4% versus 56.5%

Background: Last undercut 35%, the threshold for bullishness, in early June 2012.

Bears: 15.2%
13.9% versus 14.2% versus 14.2% versus 14.1% versus 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.


OTHER MARKETS

Bonds (10 year): 1.92% versus 1.94%. Rebounding after the Wednesday crash lower. Bear flag looking.
1.94% versus 1.98% versus 1.91% versus 1.86% versus 1.86% versus 1.89% versus 1.88% versus 1.90% versus 1.93% versus 1.95% versus 1.95% versus 1.89% versus 1.89% versus 1.90% versus 1.86% versus 1.91% versus 1.86% versus 1.93% versus 1.96% versus 1.95% versus 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%


Euro/$: 1.0862. Breaking lower through the 50 day MA . . . but likely not a major break lower.
1.0824 versus 1.0722 versus 1.0733 versus 1.0738 versus 1.0801 versus 1.0768% versus 1.0681 versus 1.0655 versus 1.0570 versus 1.0654 versus 1.0782 versus 1.0819 versus 1.0939 versus 1.0950 versus 1.0872 versus 1.0759 versus 1.0752 versus 1.0833 versus 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


Oil: 57.18, -0.48. Working laterally in a weeklong consolidation of its last move. Still looks solid.


Gold: 1175.30, -19.10. Quite the plunge, taking out even the early April low. Heading back down to the 1143 support.

$/JPY: 118.91. Flopped back to the 50 day EMA, but still in the 6 week lateral trading range, right at midlevel.
119.53 versus 119.90 versus 119.66 versus 119.26 versus 119.12 versus 119.03 versus 119.18 versus 119.39 versus 120.12 versus 120.20 versus 120.64 versus 120.15 versus 120.32 versus 119.48 versus 119.73 versus 119.72 versus 119.94 versus 120.11 versus 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


MONDAY

The coming week could be very interesting. NASDAQ pressing toward a true all-time high; will it be the dog that caught the car, the comment we made as RUTX hit its new high right before the Friday flop?

Greece will move more into the spotlight as it runs out of options. Saw some of that emerge Friday as the EU officials called out the Greek Finance minister for 'delaying tactics' and chided him as an 'amateur.' This could be a problem.

Then there are earnings. With the treatment of AMZN, GOOG, MSFT and SBUX on what in some cases were at best so-so earnings, has all of the good earnings news been baked in? It happens. Look at how BRCM sold quickly off after a tremendous upside gap on its results. We will watch how other gappers hold their earnings gaps. It may be we get some downside plays.

I don't want to sound as if I am totally turning off this market move. Thus far it has done basically exactly what we thought it would while many had their doubts. If the leaders keep leading and new ones step up to fill in for those that falter, certainly the move continues, perhaps in the vein of February and the money we made then.

Way back in March we said, however, that NASDAQ hitting 5132 could be its top. A lot has intervened in the interim, namely a fade and a new base and now a new breakout. That is very good versus one run to the peak that uses all the ammo. The indices have good bases behind them and that suggests they are just now starting a new, solid move.

Just don't get too certain a February repeat has to happen. Let the plays work, let the leaders lead. If they do, great. If we see some breakdowns we need to be cautious. Some stocks are struggling or looking heavy: FB, TWTR, SUNE, VIPS, UA. Not a ton and nothing new about leaders having to take a breather. Moreover, LOTS of stocks still look good. Thus we let our positions work, and if we see new solid ones come up, we put them to work. Just don't lose sight that no move is guaranteed, i.e. watch, as Shoeless Joe Jackson told rookie Moonlight Graham, for in your ear.

Have a great weekend!


SUPPORT AND RESISTANCE

NASDAQ: Closed at 5092.08

Resistance:
5132.52 is the 3/2000 all-time high

Support:
5042 is the March 2015 post-bear market high
The 10 day EMA at 5017
5008.57 is the early March 2015 post-bear market high
The 50 day EMA at 4929
4921 is the January to April pattern trendline
4912 the mid-April China dip
The March lows at 4843 and 4825
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
The 200 day SMA at 4668
4631 is the October 2014 upside gap point
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


S&P 500: Closed at 2117.69

Resistance:
2119.59 is the February intraday prior all-time high
2151 is the lower trendline from 11/2012

Support:
2115 is the late March lower high
2112 breaks from the current 8 week pattern
2094 is the December 2014 high, the prior all-time high
The 50 day EMA at 2083
2079 is the intraday all-time high from November
2076 is the all-time high from November
2062 is the January 2015 lower high
The 200 day SMA at 2023
2011 is the September prior all-time high
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 18,080.14

Resistance:
18,104 is the December high
18,206 is the late March lower high
18,289 is the all-time high

Support:
17,991 is the early December interim
17,923 is the January 2015 lower high
The 50 day EMA at 17,917
17,779 is the lower trendline from January to April
17,748 is the mid-April China margin selloff
The March low at 17,620
The 200 day SMA at 17,424
17,351 is the September 2014 all-time high.
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


ECONOMIC CALENDAR

April 24 - Friday
Durable Orders, March (8:30): 4.0% actual versus 0.5% expected, -1.4% prior
Durable Goods -ex tr, March (8:30): -0.2% actual versus 0.4% expected, -1.3% prior (revised from -0.6%)

April 28 - Tuesday
Case-Shiller 20-city, February (9:00): 4.7% expected, 4.6% prior
Consumer Confidence, April (10:00): 102.2 expected, 101.3 prior

April 29 - Wednesday
MBA Mortgage Index, 04/25 (7:00): 2.3% prior
GDP-Adv., Q1 (8:30): 1.1% expected, 2.2% prior
Chain Deflator-Adv., Q1 (8:30): 0.5% expected, 0.1% prior
Pending Home Sales, March (10:00): 1.6% expected, 3.1% prior
Crude Inventories, 04/25 (10:30): 5.315M prior
FOMC Rate Decision, April (14:00): 0.25% expected, 0.25% prior

April 30 - Thursday
Initial Claims, 04/25 (8:30): 290K expected, 295K prior
Continuing Claims, 04/18 (8:30): 2318K expected, 2325K prior
Personal Income, March (8:30): 0.2% expected, 0.4% prior
Personal Spending, March (8:30): 0.5% expected, 0.1% prior
PCE Prices - Core, March (8:30): 0.2% expected, 0.1% prior
Employment Cost Inde, Q1 (8:30): 0.6% expected, 0.6% prior
Chicago PMI, April (9:45): 50.0 expected, 46.3 prior
Natural Gas Inventor, 04/25 (10:30): 90 bcf prior

May 1 - Friday
ISM Index, April (10:00): 52.0 expected, 51.5 prior
Construction Spending, March (10:00): 0.4% expected, -0.1% prior
Michigan Sentiment - Final, April (10:00): 96.0 expected, 95.9 prior
Auto Sales, April (17:00): 5.4M prior
Truck Sales, April (17:00): 8.2M prior

End part 1 of 3
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Saturday, April 18, 2015

The Daily, Part 1 of 3, 4-18-15

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4/18/2015 Investment House Report
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MARKET ALERTS:

Targets hit: None issued
Buy alerts: None issued
Trailing stops: QIWI; WWWW
Stop alerts: AMZN; BSFT

The market alert service is a premium level service where we issue intraday alerts relating to the general market conditions, when stocks hit action points (buy, stop, target, etc.), and when we see other information impacting the market or our stocks. To subscribe to the alert service you can sign up at the following link:
http://www.investmenthouse.com/alertdaily.html

********************************************************************
The Market Video is DIVIDED into component parts: Market Overview, Economy, Technical Summary, and the Next Session. Choose the segments you are interested in without having to search a longer video. Click on the link to the portion you wish to view.

TO VIEW THE MARKET OVERVIEW CLICK THE FOLLOWING LINK:
Flash: http://investmenthouse1.com/ihmedia/f/mo/mo.mp4

TO VIEW THE ECONOMY OVERVIEW CLICK THE FOLLOWING LINK:
Flash: http://investmenthouse1.com/ihmedia/f/eco/eco.mp4

TO VIEW THE TECHNICAL SUMMARY VIDEO CLICK THE FOLLOWING LINK:
Flash: http://investmenthouse1.com/ihmedia/f/ts/ts.mp4

TO VIEW THE NEXT SESSION VIDEO CLICK THE FOLLOWING LINK:
Flash: http://investmenthouse1.com/ihmedia/f/nxt/nxt.mp4
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The REPORTS SCHEDULE is as follows:

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.

MARKET SUMMARY

- A confluence or 'witch's concoction' of external negatives trigger expiration selling.
- China starts to implement rules on its exchanges, a move seen as potentially disrupting the insane China stock run.
- EU countries preparing for a Greece EU exit by 'quarantining' Greece.
- Government regulation enters the market as the DOJ to sue against the Comcast/Time Warner deal.
- Indexes fall hard, RUTX gives up new high, but they hold the 50 day MA and the trendlines just as in December/January.
- Leadership showing very little damage.
- Damage done, even 'psychological damage' as one emotional trader puts it, but technically still solid, still working on same patterns.
- Indices showing the same action as in prior consolidation. Of course that doesn't mean they have to hold and breakout again. It does, however, show they have not died because of Friday.

Stocks take it on the chin Friday from the get go.

Just when the US stock market looked as if it was finally breaking out, the old stories from the rest of the world dragged it back. Yes a reference to 'The Godfather Part III,' the worst of the trilogy, but point taken.


'Just when I thought I was out, they pull me back in.' Now time for a diabetic seizure -- 'The Godfather Part III'

World stories/events took decent early (very early) US futures and trashed them along with Asia and Europe. To wit:

China: The China Securities Regulatory Commission plans a ban on margin financing on over-the-counter trades. BUT it increased the number of stocks available for shorting by 1000. Not bad actions to take for stock markets.

The thought of the government tightening trading, however, spooked investors that China might go too far and cause a Chinese market reversal. Well, it did, at least for a day. Government meddling in markets ALWAYS spooks investors, and when it is China, and when its markets are up massively a la US NASDAQ IN 1999, you can understand the trepidation.


Greece: Amorphous default worries at first, but then the real issue was the news that EU countries are taking steps to 'quarantine' Greece vis-a-vis their countries in order to minimize the impacts of a Greece EU exit. It looks to be a fait accompli that Greece exits though many continue to deny the possibility.


Bloomberg: On top of ALL of that, Bloomberg terminals worldwide went dark. So many brokerages, pension fund managers, etc. rely on those terminals that an outage, particularly on expiration, has a major market impact. Add to that the China and Greece issues and you had a serious market problem.


Stocks sold off into midmorning but then traded laterally in a tight range for two hours, setting up an afternoon rebound attempt. At 1:00ET, however, the DOJ announced it would sue to block the Comcast/Time Warner deal. That sparked another 110 points downside on DJ30 and commensurate declines in the other indices.
Stocks tumbled sharply to new session lows, taking NASDAQ, SP500, SP400 to the 50 day EMA. DJ30 fell through its 50 day.

It took an hour, but stocks rebounded to recover all of the DOJ selloff. They
managed to hold that recovery of the DOJ deal block afternoon selloff, managing a decent bounce the last two hours. Sure it was some short covering by the day traders after a big selloff that saw DJ30 off 356 points before rebounding to a 280 point loss, but as we will discuss, its looks as if there was more to it than just some short covering.

SP500 -23.81, -1.13%
NASDAQ -75.98, -1.52%
DJ30 -278.47, -1.54%
SP400 -1.20%
RUTX -1.53%
SOX -1.41%

VOLUME: +18% on both NYSE and NASDAQ. Clearly distribution as most of the session was lower. But the indexes held the 50 day MA and TL's and rebounded some. The 50 day MA is a key level and what do we say about high volume tests of that level? They are not necessarily that bad because it shows buyers supporting at that key level. It was expiration, another reason we should not put TOO much into that volume.

A/D: -4:1 NYSE, -3.7:1 NASDAQ. Serious but not extreme such as -8:1 or -10:1.


THE MARKET

The losses were significant in size and in volume. Breadth was no after school special softball either. Looks bad, felt bad. But aside from the RUTX giving up its new high, DJ30 losing 356 points on the low and giving up the 2015 gains, some really negative emotions, and a view on the financial stations that the action showed true carnage, it was not all bad. Really, you say? It wasn't good, but there are some very important details to note.

CHARTS

The US stock market was in the process of breaking out, at least RUTX broke out and was trying to lead the others with it.

Then came the gut punch of overseas issues noted above. Are these as deadly to the US stock market as Friday suggested or was it just a confluence of negatives hitting at the right time to trigger a visceral reaction?

Will Greece hurt the US? Not anytime soon. If it links with Russia that could be a pain down the road but Greece will find the Russians no friendlier than the Germans in terms of what Russia will require in order to bailout Greece. Russia with a port on the Mediterranean? Air base? 51% ownership of Greece? Problems, but not near term.

Will China banning margin financing on over-the-counter stocks hurt the US? Will it hurt China? Of course not.

Bloomberg terminal outage? That spooks the market for several reasons. One, was it a system issue or some outside influence (e.g. terrorism)? Market infrastructure issues are ALWAYS a problem for markets. If you cannot access markets that is about as serious as it gets. That was a major factor to the market struggles Friday though the other stories are the kind the market doesn't like and they piled on to the weakness.

None of these events, however, is a real issue for the US economy and US stock market. It is just that China's regulation, Greece's exit prep, Bloomberg's outage, revenues misses in US earnings, and now the heavy hand of government intervention (again) all piled up and piled onto stocks. Add in expiration and it is a 'witches concoction' as the Fed-speak this week said.

Now the TECHNICAL LOOK.

Technically there is something else to note, and we feel it is pretty important.

SP500, DJ30, NASDAQ, RUTX, and SP400 all held trendlines that began either in December 2014 or January this year. NASDAQ hit it and bounced quite nicely. SP500 did a decent job as well.

SP500, NASDAQ and SP400 all hit the 50 day MA (coincident with the trendlines) and held nicely.

RUTX' trendline is well above its 50 day and RUTX held the trendline and bounced.

Carnage? It was not a good day for sure, but bigger picture if you can get past the sackcloth and ashes on the financial stations you can see an important trendline holding. It held today and given all of the external crapola hitting stocks it is worth seeing if it will hold into next week and continue the rebound as the confluence of bad news that hit Friday subsides, recedes, is perhaps, forgotten.

A little bit of history repeating?

When did this technical action occur before? The December/January consolidation that shows the same patterns on SP500, DJ30, NASDAQ, SP400, RUTX. Now that does not guarantee the same result this time, but the trendlines were touched and the indexes bounced from there just as back then.

Of course the trick is if they can continue the recovery next week. Always a rub as nothing is certain in the market.

Recall we said just over a week back as the market was up for a week off the test of the lows in the patterns that SP500, DJ30 and NASDAQ had made another test of the low in the pattern before breaking out and that they could easily do that again. They are doing that right now.


LEADERSHIP

Definitely another technical factor on the session. We play leaders and stocks turning the corner out of long declines that turned into bases that are turning to breaks higher. That is where new market leaders come from, the breeding ground of leaders so to speak. Our positions, the vast majority, all held up just fine in this selling, putting in rather normal tests.

Metals: AKS is in a 2-day 10 day EMA test on lower volume. FCX is barely giving up any ground from its big break higher. SID is in a 2-day test as well, still easily above the 10 day EMA.

Energy: Modest pullbacks as well. SN in a 2-day test, HAL tapping the 10 day EMA. SWN up on the day. SLB up on its earnings. GPOR, XEC ignoring the selling. CVX in a beautiful 10 day EMA test. APC showing a nice doji with tail testing its break through the 200 day MA.

Construction equipment: CAT and TEX making the same tests of metals and energy, i.e. easy 2-day tests of the 10 day EMA, showing doji.

Software: Techs were dinged a bit more but held up. SPLK dropped over 3% on the close but bounced back from a test below the 50 day MA. FEYE was lower but on very low volume, holding over the 50 day EMA. BSFT sold but could not bounce and we closed it. BLKB shows a nice tight doji at the 10 day EMA in a nice easy pullback. RHT was a pain, gapping lower, but it held the 20 day EMA and the gap with a doji.

Tech: DDD showed a very easy pullback. SUNE (chips) tapped the 10 day on the low and rebounded. AAPL faded again to the 50 day MA as it did twice in March.

China: JD a doji test of the 10 day EMA. Ditto NOAH. YNDX was flat on the session, rebounding off the low. VIPS shows a doji at the 20 day EMA. SOHU posts a modest test of its rally. All the issues in China and most of these stocks held well. We did take the rest of QIWI because after hitting the 200 day MA and taking more gain, it fell harder. CMGE was lower but it held the 10 day MA on the low, bounced some.

Internet: Some issues. WWWW broke the 20 day MA and we sold it for a modest gain. Social struggled a bit. TWTR sold but held the 20 day on the close. FB gapped lower to the 50 day EMA. It held and has a potential D point to an ABCD. GOOG still stinks, selling to a lower low on this pullback.

Biotech: CNDO put in a doji test tapping the 10 day EMA. CLDX did sell to the 50 day EMA but puts in a higher low if it holds. CRIS a doji at the 10 day EMA. CELG, of course, gapped lower.

Retail: Same story getting worse. BBY down another 2%. BWLD down 2%. TJX down 1.9%. COST -1.7%. All broke key levels the past week and are in straight selloffs.

MISC: MOBI held up just fine with a doji test of the 10 day MA. MBLY sold modestly, bouncing nicely off the intraday low.

That was a long explanation but it goes hand in hand with the discussion of stock indexes. You can see why the indexes hit the trendlines and held. This is as they did in January.


MARKET STATISTICS

NASDAQ
Stats: -75.98 points (-1.52%) to close at 4931.81
Volume: 1.939B (+18.57%)

Up Volume: 371.99M (-393.57M)
Down Volume: 1.59B (+724.79M)

A/D and Hi/Lo: Decliners led 3.55 to 1
Previous Session: Decliners led 1.11 to 1

New Highs: 46 (-76)
New Lows: 49 (+23)

S&P
Stats: -23.81 points (-1.13%) to close at 2081.18
NYSE Volume: 892.9M (+18.22%)

A/D and Hi/Lo: Decliners led 4.03 to 1
Previous Session: Decliners led 1.26 to 1

New Highs: 21 (-40)
New Lows: 15 (+8)

DJ30
Stats: -279.47 points (-1.54%) to close at 17826.3


SENTIMENT INDICATORS

VIX: 13.89; +1.29
VXN: 16.03; +1.53
VXO: 14.47; +1.72

Put/Call Ratio (CBOE): 1.12; +0.26. Quick jump back over 1.0.


Bulls and Bears: Bulls tumble, bears still holding fast.

Bulls: 50.5% versus 50.4% versus 54.5% versus 56.6%

Held steady after the fairly sizable move lower the prior week. Decent to see them lower but they are not low.

Bears: 13.9% versus 14.2% versus 14.2% versus

Crazy. Bulls tail off some and bears drop as well. This is the result of the Fed having the market's back for so long. Bears are stagnant, even declining.

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.




Bulls: 50.5%
50.4% versus 54.5% versus 55.6% versus 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.

Bears: 13.9%
14.2% versus 14.2% versus 14.1% versus 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.


OTHER MARKETS

Bonds (10 year): 1.86%
1.89% versus 1.88% versus 1.90% versus 1.93% versus 1.95% versus 1.95% versus 1.89% versus 1.89% versus 1.90% versus 1.86% versus 1.91% versus 1.86% versus 1.93% versus 1.96% versus 1.95% versus 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%

Held the 50 day MA and surged. Has traded in this range for four weeks, holding the move off the early March low. Just not showing that much belief the Fed acts in June.


Euro/$: 1.0801
1.0768% versus 1.0681 versus 1.0655 versus 1.0570 versus 1.0654 versus 1.0782 versus 1.0819 versus 1.0939 versus 1.0950 versus 1.0872 versus 1.0759 versus 1.0752 versus 1.0833 versus 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

Dollar down on the session and the week, but a doji at the 50 day MA and looks ready to bounce back up. Think about it. If the Greece issue was so bad would the euro have rallied? Perhaps the smart money views a Greece exit a euro positive.


Oil: 55.71, -1.00. Modest decline, holding the break higher on the week.


Gold: 1203.10, +4.90. Still working laterally in a four week range after rallying off support in March. Very similar to the TLT in the lateral move after the initial rally. Both feed on the same thing so the hesitation to figure out what the Fed will do makes sense.


$/JPY: 119.12
119.03 versus 119.18 versus 119.39 versus 120.12 versus 120.20 versus 120.64 versus 120.15 versus 120.32 versus 119.48 versus 119.73 versus 119.72 versus 119.94 versus 120.11 versus 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

Doji at the bottom of the four week range.


MONDAY

Technically the indices are at a point where they held before in the same kind of action they showed before when they did hold. Leadership is testing but is holding as well.

Again, while the indices held where they had to, the action does not guarantee they hold and breakout as they did in January into February. Some damage was done as RUTX coughed up its all-time high, and that is never good action.

Indeed, there are those who say the market suffered 'considerable psychological damage' Friday. Dennis Gartman said so, voicing he is 'disturbed' by the market action Friday. He 'cut back positions considerably', going short on some to get neutral. Now over the past year when DG appears on the financial stations and voices his emotions, this has typically meant the opposite of his feelings occurs next. He appears to trade according to feelings a lot, or at least when he talks about his actions he couches them in terms of his feelings. I dare say that Mr. Gartman's reference to 'psychological damage' applies more to his state of mind than anyone else's. Of course he has made a lot of money doing what he does and we could be way off base. Wouldn't be the first time.

Still, we work by technical action. Our positions are holding their patterns and trends. Those few that didn't or that did not recover on the day, we dumped. There were not many in that group. Sure none of us in the office were cheering the action Friday, but as our alerts showed, we were applying technical parameters to the market action. Again, while we didn't like the severity of the drop, there were reasons for it that all merged at once, and when we applied the technical overlays we saw most positions and leaders hold up quite well.

In any event, the action was emotionally demoralizing, but it was not near the technical issue for the market as it was emotional. Certainly the indexes need to hold these trendlines and 50 day MA, but they again did what they needed to do and now we see if the market can put the Friday worries behind it and have leaders continue the moves they started on the week and HELD through the Friday 'psychological damage.'

Have a great weekend!


SUPPORT AND RESISTANCE

NASDAQ: Closed at 4931.81

Resistance:
5008.57 is the early March 2015 post-bear market high
5042 is the March 2015 post-bear market high
5132.52 is the 3/2000 all-time high

Support:
The 50 day EMA at 4904
The March lows at 4843 and 4825
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
The 200 day SMA at 4653
4631 is the October 2014 upside gap point
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 2081.18

Resistance:
2094 is the December 2014 high, the prior all-time high
2115 is the late March lower high
2119.59 is the all-time high
2144 is the lower trendline from 11/2012

Support:
2079 is the intraday all-time high from November
2076 is the all-time high from November
The 50 day EMA at 2078
2062 is the January 2015 lower high
The 200 day SMA at 2020
2011 is the September prior all-time high
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 17,826.83

Resistance:
The 50 day EMA at 17,891
17,923 is the January 2015 lower high
17,991 is the early December interim
18,104 is the December high
18,206 is the late March lower high
18,289 is the all-time high

Support:
The March low at 17,620
The 200 day SMA at 17,398
17,351 is the September 2014 all-time high.
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


ECONOMIC CALENDAR

April 17 - Friday
CPI, March (8:30): 0.2% versus 0.3% expected versus 0.2% prior. -0.1% year/year
Core CPI, March (8:30): 0.2% versus 0.1% expected versus 0.2% prior. +1.8% year/year
Michigan Sentiment, April Preliminary (10:00): 95.9 actual versus 93.0 expected versus 93.0 prior
Leading Indicators, March (10:00): 0.2% actual versus 0.3% expected versus 0.1% prior (from 0.2%).

April 22 - Wednesday
MBA Mortgage Index, 04/18 (7:00): -2.3% prior
FHFA Housing Price I, February (9:00): 0.3% prior
Existing Home Sales, March (10:00): 5.07M expected, 4.88M prior
Crude Inventories, 04/18 (10:30): 1.294M prior

April 23 - Thursday
Initial Claims, 04/18 (8:30): 288K expected, 294K prior
Continuing Claims, 04/11 (8:30): 2380K expected, 2268K prior
New Home Sales, March (10:00): 517K expected, 539K prior
Natural Gas Inventor, 04/18 (10:30): 63 bcf prior

April 24 - Friday
Durable Orders, March (8:30): 0.5% expected, -1.4% prior
Durable Goods -ex tr, March (8:30): 0.5% expected, -0.6% prior (revised from -0.4%)

End part 1 of 3
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Saturday, April 11, 2015

The Daily, Part 1 of 3, 4-11-15

* * * *
4/11/2015 Investment House Report
* * * *

MARKET ALERTS:

Targets hit: None issued
Buy alerts: CLDX; FORM
Trailing stops: None issued
Stop alerts: None issued

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http://www.investmenthouse.com/alertdaily.html

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The REPORTS SCHEDULE is as follows:

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.

MARKET SUMMARY

- SP500, DJ30 step up (thanks to GE) while SP400, RUTX still have new highs to hit
- Higher or lower? Pundits a bit less bullish.
- Leaders still stepping up from all strata of the market.

After all of the moves last week, the upside gains as the indices held support and bounced where they should, the large cap indices still did not answer the questions of whether this move has the right stuff.

The Right stuff or the wrong stuff?

Crew from 'Armageddon' Mercury astronauts from 'The Right Stuff'

If you watch the financial stations the pundits are split. Well, not really. When the market is moving up you typically only see those gushing about how great the market is with just a few token nonbelievers on to 'balance' the dialogue. When you review the bulls versus bears you can see the bulls waning a bit (50.4% versus 54.5%) but bears are still not moving up (holding at 14%+/-). Kind of like the market when it tests on lower volume: there are no sellers entering, it is just the buyers taking a breather.

There are those who feel the recovery in the economy is for real, in some cases they say 'great,' and thus capable of supporting more stocks gains. Others say it is all built upon a house of QE and easy money cards and that the recovery we have is a pathetic shadow of US recoveries in the past, and thus a massive stock crash has to come.

I would have to side with the latter in terms of the recovery. It IS a shell of what we usually have for many reasons. The most important, however, is the utter lack of serious small business creation, the heart of all US recoveries and indeed the heart of the US economy and its world leading status for over 60 years. The policies put forth the past six years have utterly crushed small businesses with layers of regulations and costs making it impossible for them to compete. Thus this recovery is only felt by a relatively small segment of the US. Hence a record 93.5M working age adults (out of a population of 317M total) are out of the workforce, relying on the few remaining workers to pay for their existence. They don't want that; it is a rather rational economic choice for them based upon the regulatory framework established. But I do tend to drone on . . .

As for a stock crash, I don't know. I just play the moves the market gives. If it is paying me to play upside, I play upside. If it is paying me to play downside, I play downside. Yes I have strong views about economics, politics, etc., and I freely share them. When it comes to the market I have strong views as well: take what the market gives. It doesn't care what you think. It doesn't care what the people on TV think. It doesn't care what a stock's ticker is and that it may be reviled by the world. It does what it does. Always remind yourself of that as you look at the market stock patterns. We forgot that lesson recently and watched a textbook setup in . . . HLF take off as it said it was going to do. Stupid. More than that, it cost me money in opportunity lost; 10 points on the stock and likely 200% on options. Did I say stupid?

So, this past week the market moved up and we were buying. We also took some gain on early movers in the China stocks, e.g. JD, ATHM.

Now the question is, where is the market after a week of upside?

Well, it wasn't massive upside, at least for the indices. NASDAQ had the best week as it led the move while RUTX and SP400, posting great starts to the week, just drifted higher after that initial move. DJ30 and SP500 moved up in their ranges, taking the lead on some sessions. Even the stodgy can get a second wind.

NONE of the indices, however, answered the question of where next. SP400 and RUTX are clearly in the best trends, but again they failed to take out the March all-time highs. They are snugged right up against them, but did not make the break through.

NASDAQ had the best week but it has not broken up the potential head and shoulders pattern. Indeed, it didn't even make it past the late February peak, the high prior to the March post-bear market high.

SP500 and DJ30 bounced off the lows in their recent ranges, and SP500 took out the late January peak. All they have really done, however, is bounce off support in their ranges. They are, however, still working on patterns very similar to December and January as they work upside and laterally. That does not mean, however, they don't test again in the range, just as they did in January as that pattern put in four bottoms and the current one has at best three.

As for SOX, it made a nice move, breaking through the 50 day MA Thursday, but it still has so much resistance and such an unlovely pattern that its upside move is problematic in our view.

So, upside on the week, but not a lot of answers to the bigger questions. So why the heck were we buying? Because stocks in good patterns were showing the right stuff, i.e. making good upside breaks. They setup and breakout when the market moves, they test when the market struggles, then they lead the move yet again, often moving ahead of the overall market.

FEYE, GERN, YNDX, CRIS, AMZN, JD, QIWI, ATHM, SUNE and many others sported strong moves on the week. When leaders move, it behooves us to move.

The question now is where next for the market after a week of gains ahead of earnings season. The market left itself some space to run into results. It did, but as noted it did not make any major breakouts. That is the question for this week.

THE MARKET

SP500 10.88, 0.52%
NASDAQ 21.42, 0.43%
DJ30 98.92, 0.55%
SP400 0.25%
RUTX 0.45%
SOX 0.41%

CHARTS

NASDAQ: A very good week for NASDAQ in terms of price and it did show some higher volume on the upside sessions though still below average. The move took NASDAQ back to its February peak, the high prior to the March post-recovery high. That still leaves NASDAQ with a very real head and shoulders possibility. It overcame that pattern in the December to January move and we will be looking for it to do the same here either with a break higher from the Friday close or another test that puts in a higher low and then makes a new rally back upside.

DJ30 and SP500: A good week as well, taking the lead on some sessions including Friday. Moved up off of the lows of the recent range and are working on the same patterns as built in January. Good action thus far, approaching the March peak and the December peak. As with NASDAQ, they can either break further upside from here or test back down, put in another low, and rebound again as in January.

SP400 and RUTX: Closed out the week just below the all-time high from late March. Great start to the week but no follow through, meandering slightly higher to Friday. Important to see these two make the break to a new high. A short test of the 20 day EMA would not be bad before making that move, but don't want to see any significant fades.

SOX: Through the 50 day MA. That is about all you can say. Did clear the December peak as well, by just a hair. Maybe it can do remedial work on its pattern and rally right back up or work laterally and then move up. We will see. Lots to show.


LEADERSHIP

China: Good week, stalling some late. JD, QIWI, ATHM, QIHU, YNDX. Great moves. CMGE is setting up for us.

Biotech: Some very nice moves as well. GERN, OMER, CRIS. CNDO looks good.

Internet: Social looks good still. LNKD gapped Friday and looks good for us. TWTR is holding well.

Software: A nice leader. FEYE working well, SPLK moving upside. CYBR working well and setting up a new buy. RHT looks ready for a play.

Big Names: AMZN enjoyed a good week. CMG is starting to surge. PCLN is in a great setup. AAPL suffered two downgrades but is still in a solid pattern. NFLX announced a stock split.


MARKET STATISTICS

NASDAQ
Stats: +21.41 points (+0.43%) to close at 4995.98
Volume: 1.479B (-12.17%)

Up Volume: 1B (-40M)
Down Volume: 481.4M (-190.43M)

A/D and Hi/Lo: Advancers led 1.45 to 1
Previous Session: Decliners led 1.06 to 1

New Highs: 114 (+16)
New Lows: 25 (-3)

S&P
Stats: +10.88 points (+0.52%) to close at 2102.06
NYSE Volume: 671.6M (-7.39%)

A/D and Hi/Lo: Advancers led 1.5 to 1
Previous Session: Advancers led 1.02 to 1

New Highs: 109 (+10)
New Lows: 2 (-5)

DJ30
Stats: +98.92 points (+0.55%) to close at 18057.65


SENTIMENT INDICATORS

VIX: 12.58; -0.51
VXN: 14.1; -0.6
VXO: 12.5; -1.08

Put/Call Ratio (CBOE): 0.85; -0.19


Bulls and Bears: Bulls tumble, bears still holding fast.

Bulls: 50.4% versus 54.5% versus 56.6%

Finally a solid tumble as the failure to hit higher highs took its toll a couple of weeks back.

Bears: 14.2% versus 14.2% versus

Stuck at 14% and still a chronic lack of bears.

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.




Bulls: 50.4%
54.5% versus 55.6% versus 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.

Bears: 14.2%
14.2% versus 14.1% versus 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.


OTHER MARKETS

Bonds (10 year): 1.95%
1.95% versus 1.89% versus 1.89% versus 1.90% versus 1.86% versus 1.91% versus 1.86% versus 1.93% versus 1.96% versus 1.95% versus 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%


Euro/$: 1.0654. Was down to 1.05 again but the dollar weakened a bit late.
1.0654 versus 1.0782 versus 1.0819 versus 1.0939 versus 1.0950 versus 1.0872 versus 1.0759 versus 1.0752 versus 1.0833 versus 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

Still very strong dollar.


Oil: 51.64, +0.83. Nice test of the break through the 50 day EMA, holding that level on the lows.


Gold: 1204.70, +10.90.

$/JPY: 120.20
120.64 versus 120.15 versus 120.32 versus 119.48 versus 119.73 versus 119.72 versus 119.94 versus 120.11 versus 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

Holding a bounce off of a double bottom below the 50 day EMA.
MONDAY

As discussed in the Market Summary, the indices moved to critical points, particularly in terms of NASDAQ, SP400, and RUTX. Many solid stocks moved higher last week, rallying in good patterns. We bought several, took some gain, pared some positions with trailing stops that were not that great.

Though the indices are approaching important resistance there are many quality stocks still in great position. We are looking at many on this report. Stocks that have rallied well setting up for new moves, e.g. RHT, LNKD, CYBR. Stocks that are turning the corner in good patterns after long declines, e.g. CMGE, DDD, MOBI. The market continues to produce stocks from all strata that are contributing to the upside moves. That more than anything is the key to continued upside runs.

That does not mean there won't be setbacks. The indices have moved up and are facing resistance. They could fade to test and the move remains perfectly intact. Of course we have to avoid assuming anything, assuming that upside has to be the path. The indices need to break up some toppy patterns in some instances, and if they cannot it can be surprising how fast the selling comes around.

So, we continue to see good patterns developing and are playing them as they are ready to buy. At the same time we are aware of earnings, the run to earnings, the index resistance. Thus you will see many of our play targets account for this as we look at totally doable shorter term targets. Take what the market gives, right?

Have a great weekend!


SUPPORT AND RESISTANCE

NASDAQ: Closed at 4995.98

Resistance:
5008.57 is the early March 2015 post-bear market high
5042 is the March 2015 post-bear market high
5132.52 is the 3/2000 all-time high

Support:
The 50 day EMA at 4887
The March lows at 4843 and 4825
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
The 200 day SMA at 4639
4631 is the October 2014 upside gap point
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 2102.06

Resistance:
2115 is the late March lower high
2119.59 is the all-time high
2138 is the lower trendline from 11/2012

Support:
2094 is the December 2014 high, the prior all-time high
2079 is the intraday all-time high from November
2076 is the all-time high from November
The 50 day EMA at 2074
2062 is the January 2015 lower high
The 200 day SMA at 2017
2011 is the September prior all-time high
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 18,057.65

Resistance:
18,104 is the December high
18,206 is the late March lower high
18,289 is the all-time high

Support:
17,991 is the early December interim
17,923 is the January 2015 lower high
The 50 day EMA at 17,865
The March low at 17,620
The 200 day SMA at 17,370
17,351 is the September 2014 all-time high.
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


ECONOMIC CALENDAR

April 14 - Tuesday
Retail Sales, March (8:30): -0.6% prior
Retail Sales ex-auto, March (8:30): -0.1% prior
PPI, March (8:30): -0.5% prior
Core PPI, March (8:30): -0.5% prior
Business Inventories, February (10:00): 0.0% prior

April 15 - Wednesday
MBA Mortgage Index, 04/11 (7:00)
Empire Manufacturing, April (8:30): 6.9 prior
Industrial Production, March (9:15): 0.1% prior
Capacity Utilization, March (9:15): 78.9% prior
NAHB Housing Market , April (10:00): 53 prior
Crude Inventories, 04/11 (10:30)
Net Long-Term TIC Fl, February (16:00): -$27.2B prior

April 16 - Thursday
Initial Claims, 04/11 (8:30)
Continuing Claims, 04/11 (8:30)
Housing Starts, March (8:30): 897K prior
Building Permits, March (8:30): 1092K prior
Philadelphia Fed, April (10:00): 5.0 prior
Natural Gas Inventor, 04/11 (10:30)

April 17 - Friday
CPI, March (8:30): 0.2% prior
Core CPI, March (8:30): 0.2% prior
Michigan Sentiment, April (10:00): 93.0 prior
Leading Indicators, March (10:00): 0.2% prior

End part 1 of 3
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