Saturday, April 21, 2018

The Daily, Part 1 of 3, 4-21-18

* * * *
4/21/2018 Investment House Daily
* * * *

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Targets hit: None issued
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Stop alerts: None issued

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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:
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The REPORT SCHEDULE is as follows:

Market Summary Video, Plays and Play Videos, and Play Table with play
annotations will issue Wednesday, Weekend.

Monday a Market Summary video, new plays, play table annotations.

Tuesday and Thursday reports will contain the market summary, chart links to
view the index charts, and updated play table.

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

- Expiration sees a second day of selling off the Wednesday recovery peak.
- Volume mixed, not that high (surprise) as stocks sell.
- A lot of positive news in the world, but you would not know it.
- Will the bond yield curve invert? Does it matter?
- Still so many good patterns to drive the market upside. Can they do it
sans chips?
- Looking for more upside positions as earnings ramps up, stocks continue to
set up.

Not a banner expiration for the stock market, and with the worry about a 3%
10 year bond, a 2 year/10 year 40ish basis point yield curve, and weekend
event/news risk, I suppose not that surprising. There was little
volatility -- the action was all to the downside from a soft open. A couple
of bounce attempts were too thinly traded to succeed and by the close the
indices were all lower with the large cap indices back below the 50 day
MA's, now back at the 20 day EMA.

SP500 -22.99, -0.85%
NASDAQ -91.93, -1.27%
DJ30 201.95, -0.82%
SP400 -0.69%
RUTX -0.62%
SOX -1.17%
NASDAQ 10 -1.58%

VOLUME: NYSE +21% (900M); NASDAQ -5%. Some big volume in some NYSE listed
names, e.g. SKX helped push NYSE volume above average for the first session
in 7 sessions. Of course, on the downside. It was, however, expiration so
all volume is suspect.

ADVANCE/DECLINE: NYSE -2.2:1, NASDAQ -1.7:1. Still not disproportionate
and not as bad as the selling percentages would indicate.

After hitting a higher recovery high on this bounce Wednesday, stocks
struggled into the weekend. Chips didn't help, AAPL didn't help, but oil
was good, software as well. Many stocks held up very well even after 2 days
of selling. I know, I have said many leaders are holding up well even in
the weakness. I am still saying it after Friday. RHT, WDAY, FFIV, STX,
VMW, NFLX, HLF, NTNX -- many look good still, trying to offset LRCX and the
chips' drop on the TSMC guidance and all of those worries about iPhone sales
and thus potentially less demand for smartphone chips. Friday was not the
day to pull that off but most still look quite good as of the close with a
lot of important earnings to come.

Ah yes, the earnings season. It is the dominant factor though there is a
lot of talk about a recession with the bond yield curve narrowing. The 2
year and 10 year treasuries have just 40+ basis points between them and the
gap is narrowing. An inversion (2 year yield greater than 10 year yield)
historically signals a coming recession. The Fed has so intervened in the
bond market, however, some argue that the relationship does not hold the
same meaning as in the past. The level of interference/manipulation is
indeed high, but it was during the Greenspan years as well, and still bond
signals were accurate. Recall Greenspan's 'conundrum' comment to Congress
as to why yields remained low despite the Fed hiking the short end. He
opined it was due to heavy foreign buying keeping yields lower. That did
not prevent the subsequent collapse, however; the bond market signals, even
with intervention, still worked well.

Thus, bonds are likely a drag, but the market is set to receive some key
earnings this week that can definitely work a market rebound bid,
particularly with many well-positioned stocks even after Thursday and
Friday. Holding during that pullback shows owners staying with those
stocks, and good earnings brings in more bids.

Remember, we are playing a move to near the prior highs, not a new breakout,
at least not yet. While a possible recession is a huge factor, it is not so
huge near term. The curve has not inverted, stocks are not selling off
wholesale yet. Some good earnings and a rally back to the prior highs is
not far-fetched and is rather normal action.

Not saying that it has to happen. More news can hit that undercuts the
move, good patterns or no. I mean, there is a HISTORIC agreement with North
Korea, one that would be on the front page of every newspaper, the lead
story on every website, but for the mainstream media does not want to give
it much play. They rather lead with the bogus DNC lawsuit against Russia,
Wikileaks, and Trump for harming Clinton's election campaign. The only
thing that harmed the Clinton campaign was Clinton and her advisors who
ignored a big part of the country. That is what many of my left leaning
contacts believe and they are very much pro-democrat. I of course am not
democrat, not republican, but a true conservative; there is no room for me
in EITHER party. Ironically, I find that far left people who truly believe
in the Constitution and its protections can find common ground with me often
more times than republicans or mainstream democrats. Oh well.

The point: there are serious moves in the world to the positive. Not just
NKorea, but Saudi Arabia moving to modernize and aligning with the US and
Israel. These are huge shifts in the dynamics of the world for the good,
yet our headlines trumpet lawsuits that even left leaning pundits and
analysts say are BS, discuss Russia as if it is something other than a
post-communist society that never embraced capitalism and thus remains with
a puny economy that dictates the Cold War antics we see today in order to
project super power status and thus an attempt to remain relevant. Texas
alone could outmuscle Russia economically, and that has to gall Putin, the
little dictator who thinks he could.

Okay, so if the market can see the good through the BS smokescreen, it has
still room to rally and the patterns to carry it. They are still there as
they were before the chips fell. Chips are very big for the market, and if
we were playing for a market breakout this selloff be a major concern
cutting against that kind of move. That is not the case, and therefore with
the good patterns and the vast majority of our positions holding or moving
very well, we still play for that same objective heading into next week.

THE MARKET

CHARTS

A deeper test by the large cap indices broke the 50 day MA.

SP500: After rebound highs were hit Wednesday, SP500 faded into Friday,
ending at the 20 day EMA on the close. Volume rose above average, but with
expiration that must be discounted. SP500 is in a 2-day pullback to the 20
day MA and the early April recovery high and the late February low. Good
place to hold and indeed this is where SP500 needs to continue the rebound.

DJ30: Very similar to SP500, fading to the 20 day EMA and the late February
low on the Friday close as volume moved above average. Still very well
positioned to continue higher.

NASDAQ: Same story, recovery high and doji Wednesday followed by the
Thursday/Friday fade. Closed at the 20 day EMA just below the 50 day EMA.
Volume was lower and still below average on expiration; wow, no dumping for
sure. Not bad action considering the semiconductors had such a lousy end of
the week.

SOX: Speaking of SOX, it was not good. Thursday a gap below the 50 day
MA's and the lower channel trendline. An ugly week for true. That said,
after the nice February to March run, SOX sold as did the rest of the
indices. In early April it bottomed at the 78% Fibonacci retracement of
that rally. Then a bounce, and now last week's drop to match the prior low.
Get where I am heading? Potential double bottom at the 78% Fibonacci
retracement the same as SP500, DJ30. Those two bounced, moved higher, and
are testing that initial move. We will see if SOX can do the same.

SP400: Same action, higher recovery high Wednesday, testing back through
Friday. Nice action with a very good-looking pullback to the 10 day EMA,
filling the gap higher Tuesday. With the gap filled, SP400 will be ready to
move higher. Midcaps along with RUTX led the last move higher, and it looks
as if SP400 is in position to make the new move higher.

RUTX: Solid move up into Wednesday, then threw a tombstone doji. That led
to the Thursday/Friday selling to tap at the 10 day EMA on the Friday low.
Strong, market-leading move, not a pretty significant but normal test toward
the 10 day EMA, just a few points lower than the Friday close. Looking for
RUTX to fade some more early week, perhaps undercut the 10 day, show a doji
with tail, then rebound. That fits with a continuation of the upside move.


LEADERSHIP

FAANG: AAPL dropped to the 200 day SMA Friday on big volume. AMZN dropped
Friday after gapping upside Wednesday and Thursday. A bit of a fade, lower
volume on the drop. FB is working laterally, may try something but may need
more work. NFLX is testing the earnings gap and run higher. Will be a new
entry as it moves back upside. GOOG is working laterally mid-range and is
setting up a new move. Earnings are early week, and entering ahead of time
may not be a great move (LRCX versus NFLX) but it is setting up nicely.

Oil: A very good week though most were down a bit Friday. DO, HAL, APC
posted great moves, needed a rest. Others are setting up after moves, e.g.
CVX. MRO looks very good. Nice group that, after months, is actually
coming through on its patterns.

Semiconductors: SOX at the 78% Fibonacci retracement, so perhaps some of
these can now bounce after a rough week. LRCX is at the 61% Fibonacci
retracement, its second visit; much like SOX, SP500, DJ30. MU trying to
hold near the 50 day MA's, and is right at the November high. Would prefer
to see a hold here given our current position. SLAB was hammered, XLNX,
SWKS -- AAPL did not help these stocks at all.

Software: Faded Friday, but a good week. CRM was off a bit on low trade
Friday. VMW is testing its gaps higher and despite the move can go higher,
and a test is an entry opportunity. FFIV is also making a good test. GLUU
enjoyed a great week. MSFT is testing back after bumping the March peak.

Drugs/Biotech: Continues to be a solid group though diverse. IMMU is in a
nice 1-2-3 test. CERS looked very good though Friday it dropped back to the
10 day MA. AMED continues upside with a nice move. UNH is in a flag test
of the Tuesday upside gap.

Retail: Good moves midweek but fading to end the week. BBY gapped upside
Wednesday, but then faded to close the gap by Friday. HD surged but it too
faded into Friday, testing the move. Still looks very good. TSCO tried to
make the move Friday, but gave it back. Still looks good. COST is in an
excellent breakout test, forming a handle. M starting higher in a nice
pattern. RH still looks good.

MISC: SQ started breaking higher last week, struggled Friday, still looks
good. Testing a good break higher. Works. FCX broke higher, tested a bit
Friday.

Metals: FCX enjoyed a good week. Steel is interesting, possibly setting
up, e.g. AKS, STLD, SCHN.


MARKET STATS

DJ30
Stats: -201.95 points (-0.82%) to close at 24462.94

Nasdaq
Stats: -91.93 points (-1.27%) to close at 7146.13
Volume: 1.88B (-4.57%)

Up Volume: 525.97M (+1.6M)
Down Volume: 1.34B (-80M)

A/D and Hi/Lo: Decliners led 1.68 to 1
Previous Session: Decliners led 1.71 to 1

New Highs: 54 (-19)
New Lows: 63 (+14)

S&P
Stats: -22.99 points (-0.85%) to close at 2670.14
NYSE Volume: 900M (+20.47%)

A/D and Hi/Lo: Decliners led 2 to 1
Previous Session: Decliners led 2.22 to 1

New Highs: 50 (-28)
New Lows: 103 (+8)


SENTIMENT INDICATORS

VIX: 16.88; +0.92
VXN: 21.63; +1.47
VXO: 16.72; +1.46

Put/Call Ratio (CBOE): 0.98; +0.01


Bulls and Bears:

Bulls rose ever so slightly while bears continued to rise. Finally seeing
more movement upside in bears. That is the more significant of the two
because bears have been so low for so long.

Bulls: 43.6 versus 42.2

Bears: 19.8 versus 18.6

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: 43.6 versus 42.2
42.2 versus 49.5 versus 55.5 versus 54.9 versus 48.6 versus 48.1 versus 48.5
versus 41.9 versus 54.4 versus 66.00 versus 64.7 versus 66.7 versus 64.4
versus 61.9 versus 64.1 versus 64.2 versus 62.3 versus 61.5 versus 63.5
versus 64.4 versus 63.5 versus 62.3 versus 60.6 versus 60.4 versus 57.5
versus 54.3 versus 50.5 versus 47.1 versus 49.5 versus 49.5 versus 48.1
versus 50.5 versus 57.5 versus 60.0 versus 60.2 versus 57.8 versus 50.0
versus 52.5 versus 54.9 versus 51.5 versus 50.00 versus 55.8 versus 50.00
versus 51.9 versus 58.1 versus 58.7 versus 58.5 versus 54.7 versus 51.9
versus 56.3 versus 55.8 versus 49.5

Bears: 19.8 versus 18.6
18.6 versus 17.5 versus 16.8 versus 15.7 versus 15.5 versus 14.4 versus 14.6
versus 14.4 versus 15.5 versus 12.6 versus 12.8 versus 12.7 versus 13.5
versus 15.2 versus 15.1 versus 15.2 versus 15.1 versus 15.1 versus 15.4
versus 15.4 versus 14.4 versus 14.4 versus 15.1 versus 15.2 versus 15.1
versus 17.0 versus 17.1 versus 19.0 versus 20.2


OTHER MARKETS

Bonds: 2.96% versus 2.914%. Bonds broke lower Thursday, gapping below the
50 day MA. Friday they continued lower. A breakdown and 3+% 10 year yields
look viable.

Historical: the last sub-2% rate was in November 2016 (1.867%). 2.914%
versus 2.867% versus 2.83% versus 2.829 versus 2.825% versus 2.781% versus
2.801% versus 2.805% versus 2.775% versus 2.812% versus 2.806% versus 2.781%
versus 2.739% versus 2.714% versus 2.781% versus 2.775% versus 2.854% versus
2.813% versus 2.814% versus 2.881% versus 2.90% versus 2.852% versus 2.826%
versus 2.819% versus 2.844% versus 2.866% versus 2.896% versus 2.872% versus
2.879% versus 2.863% versus 2.879% versus 2.868% versus 2.799% versus 2.875%
versus 2.893% versus 2.864% versus 2.866% versus 2.934% versus 2.952% versus
2.893% versus 2.873% versus 2.904% versus 2.913%


EUR/USD: 1.22876 versus 1.23464. The euro broke lower below the 50 day
MA's. Not out of the lateral range, but heading toward the lows in the four
month range.

Historical: 1.23464 versus 1.23748 versus 1.23712 versus 1.238532 versus
1.23313 versus 1.23299 versus 1.23720 versus 1.2359 versus 1.2311 versus
1.22812 versus 1.2247 versus 1.2285 versus 1.22698 versus 1.23073 versus
1.23234 versus 1.2406 versus 1.24494 versus 1.2351 versus 1.23301 versus
1.23467 versus 1.22478 versus 1.2342 versus 1.2287 versus 1.2304 versus
1.23782 versus 1.2392 versus 1.23412 versus 1.2305 versus 1.2305 versus
1.24017 versus 1.2411 versus 1.2344 versus 1.23187 versus 1.22822 versus
1.21894 versus 1.21893 versus 1.23257 versus 1.2296 versus 1.2324 versus
1.22820 versus 1.23431 versus 1.2411 versus 1.25083 versus 1.2450 versus
1.23528 versus 1.22887 versus 1.22524 versus 1.2273 versus 1.2377 versus
1.24573 versus 1.2502 versus 1.2404 versus 1.2402 versus 1.23832 versus
1.24308 versus 1.24159 versus 1.24340 versus 1.23083 versus 1.22567


USD/JPY: 107.645 versus 107.404. Dollar trying to break higher out of the
three week lateral range.

Historical: 107.404 versus 107.409 versus 107.027 versus 107.010 versus
107.362 versus 107.267 versus 106.882 versus 106.873 versus 107.09 versus
107.16 versus 106.939 versus 107.11 versus 106.816 versus 106.797 versus
105.901 versus 106.286 versus 106.81 versus 105.397 versus 105.473 versus
104.789 versus 104.829 versus 105.892 versus 106.478 versus 105.945 versus
105.946 versus 106.344 versus 105.846 versus 106.42 versus 106.335 versus
106.77 versus 106.41 versus 106.105 versus 105.752 versus 106.359 versus
105.734 versus 106.03 versus 106.695 versus 107.381 versus 106.96 versus
106.886 versus 106.85 versus 107.581 versus 107.435 versus 106.294 versus
106.153 versus 106.782 versus 107.77 versus 108.669 versus 108.669


Oil: 68.40, +0.07. Great week, breaking higher Wednesday after a quick
test of the range breakout. Nice setup to continue the move higher. Toward
80 to 100 as Saudi says? Who knows? The pattern is simply bullish.


Gold: 1338.30, -10.50. Flopped Friday after a tight lateral move all week.
Still in the range, but not breakout out Friday.


MONDAY

Earnings ramp up with GOOG (4/23 after), AMZN (4/26 after). Others are set
as well, and the bulls are looking for these stocks to reignite the upside
move. As noted earlier, there are still very good patterns to drive higher.
Good stocks as well, e.g. NFLX, FFIV, etc.

Therefore we are looking at more positions as the market heads higher with
some of these good patterns. Some oil, some big names, some retail. They
are good, the move is still a bounce, they can still make us money. Still
looking for just a move up to near the prior highs before the move
completely fizzles. It can move higher given all the good patterns, but
with the semiconductors dropping out, that prospect dimmed. If LRCX and
others in the group, including SOX itself, rally off their Fibonacci double
bottoms, that can happen. That would be great, but it has to prove it.

Have a great weekend!

End part 1
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Sunday, April 15, 2018

The Daily, Part 1 of 3, 4-14-18

* * * *
4/14/2018 Investment House Daily
* * * *

Investment House Daily Subscribers:

MARKET ALERTS:

Targets hit: None issued
Entry alerts: None issued
Trailing stops: None issued
Stop alerts: TJX

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 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
********************************************************************

The REPORT SCHEDULE is as follows:

Market Summary Video, Plays and Play Videos, and Play Table with play
annotations will issue Wednesday, Weekend.

Monday a Market Summary video, new plays, play table annotations.

Tuesday and Thursday reports will contain the market summary, chart links to
view the index charts, and updated play table.

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

- Too much turmoil and geopolitics for many to buy into the weekend.
- Stocks start higher but fade off the higher highs.
- Indices cannot take out the 50 day MA's yet, but volume and breadth are
light.
- Syria strikes raise risk level, but Trump declares 'mission accomplished.'
- Earnings start with NFLX leading off Monday as indices are in position to
continue the rebound rally.
- Still plenty of leadership in position to move higher.

The week did not end great, but while the stock indices traded lower Friday,
the overall week was positive. Even Friday. No, not a rip higher, but a
second bounce from the February lows, one that produced better internals and
much better moves by some solid leader stocks. The bounce took RUTX past
the 50 day MA's, but the rest of the indices still had to deal with that
level, something we noted as this bounces' first test. Wanted them to move
through and then come back and test from above a la RUTX, but that was not
in the cards. With the move higher on the week and a weekend with still
many potential flashpoint issues, after a higher open the bids dried up and
stocks solid back, really struggling in the afternoon session.

SP500 -7.68, -0.29%
NASDAQ -33.60, -0.47%
DJ30 -122.91, -0.50%
SP400 -0.32%
RUTX -0.50%
SOX -0.77%

VOLUME: NYSE -4%, NASDAQ -13%. Volume, already low, tumbled Friday. NYSE
posted another below average session, NASDAQ faded as well. Volume was
quite light all week with one good upside session Tuesday when the market
kicked in its first good upside move in awhile with some good internals and
leadership.

ADVANCE/DECLINE: NYSE -1.3:1, NASDAQ -1.7:1.

These internals show no selling, just a drying up of the bids ahead of the
weekend. People were not dumping stocks ahead of the weekend, they just
stopped buying given all of the geopolitical issues in the world. Oh, and
it was Friday the 13th as well.

Again, it was not a great week of power. It was, however, the second bounce
off the test of the February lows by SP500 and DJ30. It showed the internal
strength and particularly leadership that the first bounce did not have. As
you are aware, we concluded based upon the internals and the improved action
in leaders that a tradable rally was beginning and thus we started buying
the good moves. It is interesting that Friday Byron Weems said he believed
that the market would test the February low and then move higher from there.
It would appear to us that the February lows have been tested and the market
is already moving upside despite the Friday sluggishness.

Accordingly, we picked up quite a few positions on the week, greatly
expanding our exposure to the market. Some really good names moving really
well. The key now, as noted late week is whether the indices can overcome
the first test, the 50 day MA's, and continue the rally into earnings.
Friday was a 'no,' but that was not the seminal test. This week more
earnings come out and the market is set up quite well to move higher and
continue the rebound.

What about the geopolitics, e.g. the late Friday strike on Syria by the US,
France and UK (Germany sat this one out)? If things spiral out of control
of course all bets are off. Thus far, however, the market is shaking them
off and moving higher, even if on low volume.

Remember, this does not mean we think new highs are going to result. They
can but the market will need a real boost and get a lot more volume to make
that happen. Earnings can provide that as they did in October 2017. Thing
is, the move higher has been steady and straight for a long time. Starting
in January and that four week surge to higher highs, the market moves are
much more volatile. That is something moves tend to show near their end
before a deeper correction is needed.

Also, the patterns developed in the indices suggest a rebound but more has
to be shown to make new highs. Specifically, SP500 and DJ30 set up double
bottoms at the 78% and 61% Fibonacci retracement, respectively, of the
September through January rally. Those are reliable upside bounce plays
with a maximum target at the prior highs. Beyond that, again, needs to have
something more to drive it.

Therefore, on this move we play the pattern move. Then if something more
shows up to drive stocks higher, we enjoy the ride as we are already in, and
we take the opportunities presented in other stocks that will show up. We
know that to be the case because if the move continues beyond a bounce there
will be new leaders and new opportunities to play the upside.


THE MARKET

Friday the lackluster economic data continued as the slow spot I discussed
over a month ago -- and that the Fed just acknowledged this past week --
continues. Michigan Sentiment was not bad but it posted the biggest loss in
18 months.

Then there are the geopolitical issues dominated by trade, and after Friday
evening, perhaps Syria/Russia. One bright spot Friday was Secretary Ross
stating at a conference in Lima, Peru that he anticipates a new deal on
NAFTA by the third week in May.

Thus far, the market, while buffeted day to day by the news, has overcome
the negatives and is rising off the February lows. It is not a massive
surge but it is showing the right credentials in internals (when it counts)
and leadership. Even IBD says the market is now in what it calls a
confirmed uptrend again. As noted, we are playing that move, using rational
expectations.

CHARTS

RUTX: The small caps get the pole position today because they led the move
starting with a Tuesday surge off a higher low. That higher low was a test
of the initial move from the 200 day SMA and selloff that started mid-March.
RUTX broke higher through the 50 day MA's and extended that move into
Thursday. Friday of course it was off, but it is testing from a position of
strength, i.e. from above. That bodes well for RUTX successfully testing
and resuming the move upside.

SP400: Moved through the 50 day MA's Thursday on the high but could not
hold it. Again Friday but could not hold it. Still an improved pattern,
showing a pennant the past 3 months. Looks ready to follow RUTX through
that first resistance.

NASDAQ: Moved up to the 50 day MA's on the week, but was rebuffed Friday.
Holding over the rising 10 day EMA and we anticipate NASDAQ to continue the
move next week given the good leadership. NASDAQ appears to have formed a
new, wider uptrending channel using the 200 day SMA on the lows. Rallied
off that level just over a week back, a quick test, then the move higher
last week.

SOX: Came off the channel lower trendline Monday and posted a great move
into the Friday open. That move SOX through the 50 day MA's, but it could
not hold the move. Still trending in its 5 month channel, coming off the
low the past week as noted.

DJ30: Off the February lows touched just 7 sessions back. February lows,
200 day SMA, 61% Fibonacci retracement -- very good support. Bounced up to
the 50 day EMA Friday, faded modestly, lower trade. Okay, a double bottom
at the February lows, and now something of a downward pointing wedge
forming. Wedges tend to resolve to opposite direction of the point, and in
this case that would be upside.

SP500: Also held the February lows, 200 day SMA, and its 78% Fibonacci
retracement. Bounced through the Friday open, testing the 50 day MA's from
below. Faded that move, but is in very good position to hold and continue
the move higher.


LEADERSHIP

FAANG: NFLX and the four dwarves. NFLX was up all week in a good move.
AAPL up but still lodged in the range. AMZN looks weak below the 50 day MA.
FB managed to bounce on ZBurg playing nice to Congress, but still has to
appear before the EU. GOOG is holding at the 200 day SMA; perhaps some day
it can put in a bounce. For now, money has left all of this group outside
NFLX.

Chips: Still a struggle but working on it. LRCX not bad with a move up on
the week. AVGO gapped upside on a big share buyback program, but still has
to show its pattern can hold up. INTC is back near its high, coming off the
50 day MA. MU is moving up off the 50 day MA. MXWL, AMAT not bad while
MLNX is putting in higher highs. There are leaders.

Drugs/Biotech: AMED, AMAG had good weeks though Friday was off. DVAX was
strong but fell to the 10 day EMA Friday. UNH still trying to set up, ARWR
looks great, INO setting up, MYL not bad. VRX looking good. Good group.

Software: Really improving. RHT a good move last week, FFIV awesome for
us. CRM trying to make a break. GLUU breaking higher in the gaming
software. NOW setting up, COUP looks nice.

Oil: DO working quite well. HAL continues higher. APC as well. A group
of leaders that held up working well. Others are attempting to catch up.
Like NBR.



MARKET STATS

DJ30
Stats: -122.91 points (-0.50%) to close at 24360.14

Nasdaq
Stats: -33.60 points (-0.47%) to close at 7106.65
Volume: 1.76B (-12.87%)

Up Volume: 491.17M (-928.83M)
Down Volume: 1.25B (+675.7M)

A/D and Hi/Lo: Decliners led 1.64 to 1
Previous Session: Advancers led 1.85 to 1

New Highs: 52 (-19)
New Lows: 30 (+8)

S&P
Stats: -7.69 points (-0.29%) to close at 2656.30
NYSE Volume: 717.253M (-3.71%)

A/D and Hi/Lo: Decliners led 1.3 to 1
Previous Session: Advancers led 1.19 to 1

New Highs: 43 (-10)
New Lows: 50 (+8)


SENTIMENT INDICATORS

VIX: 17.41; -1.08
VXN: 22.06; -0.84
VXO: 17.89; -1.40

Put/Call Ratio (CBOE): 0.98; -0.01


Bulls and Bears:

Bulls are falling rapidly after the peak at 66.7. that was a significant
high and bulls have dropped hard into the low 40's. As you would
anticipate, the market sold off but as the bulls sell off the market is
ready for a pre-earnings rally off the lows.


Bulls: 42.2 versus 47.6 versus

Bears: 18.6 versus 18.1

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.




Bulls: 42.2 versus 47.6
49.5 versus 55.5 versus 54.9 versus 48.6 versus 48.1 versus 48.5 versus 41.9
versus 54.4 versus 66.00 versus 64.7 versus 66.7 versus 64.4 versus 61.9
versus 64.1 versus 64.2 versus 62.3 versus 61.5 versus 63.5 versus 64.4
versus 63.5 versus 62.3 versus 60.6 versus 60.4 versus 57.5 versus 54.3
versus 50.5 versus 47.1 versus 49.5 versus 49.5 versus 48.1 versus 50.5
versus 57.5 versus 60.0 versus 60.2 versus 57.8 versus 50.0 versus 52.5
versus 54.9 versus 51.5 versus 50.00 versus 55.8 versus 50.00 versus 51.9
versus 58.1 versus 58.7 versus 58.5 versus 54.7 versus 51.9 versus 56.3
versus 55.8 versus 49.5

Bears: 18.6 versus 18.1
17.5 versus 16.8 versus 15.7 versus 15.5 versus 14.4 versus 14.6 versus 14.4
versus 15.5 versus 12.6 versus 12.8 versus 12.7 versus 13.5 versus 15.2
versus 15.1 versus 15.2 versus 15.1 versus 15.1 versus 15.4 versus 15.4
versus 14.4 versus 14.4 versus 15.1 versus 15.2 versus 15.1 versus 17.0
versus 17.1 versus 19.0 versus 20.2


OTHER MARKETS

Bonds: 2.825% versus 2.825%

Historical: the last sub-2% rate was in November 2016 (1.867%). 2.825%
versus 2.781% versus 2.801% versus 2.805% versus 2.775% versus 2.812% versus
2.806% versus 2.781% versus 2.739% versus 2.714% versus 2.781% versus 2.775%
versus 2.854% versus 2.813% versus 2.814% versus 2.881% versus 2.90% versus
2.852% versus 2.826% versus 2.819% versus 2.844% versus 2.866% versus 2.896%
versus 2.872% versus 2.879% versus 2.863% versus 2.879% versus 2.868% versus
2.799% versus 2.875% versus 2.893% versus 2.864% versus 2.866% versus 2.934%
versus 2.952% versus 2.893% versus 2.873% versus 2.904% versus 2.913% versus
2.833% versus 2.857% versus 2.8577% versus 2.844% versus 2.813% versus
2.805% versus 2.707% versus 2.841% versus 2.792%


EUR/USD: 1.23313 versus 1.23299. Holding steady in its lateral move,
testing the 50 day EMA, still positive pattern overall.

Historical: 1.23299 versus 1.23720 versus 1.2359 versus 1.2311 versus
1.22812 versus 1.2247 versus 1.2285 versus 1.22698 versus 1.23073 versus
1.23234 versus 1.2406 versus 1.24494 versus 1.2351 versus 1.23301 versus
1.23467 versus 1.22478 versus 1.2342 versus 1.2287 versus 1.2304 versus
1.23782 versus 1.2392 versus 1.23412 versus 1.2305 versus 1.2305 versus
1.24017 versus 1.2411 versus 1.2344 versus 1.23187 versus 1.22822 versus
1.21894 versus 1.21893 versus 1.23257 versus 1.2296 versus 1.2324 versus
1.22820 versus 1.23431 versus 1.2411 versus 1.25083 versus 1.2450 versus
1.23528 versus 1.22887 versus 1.22524 versus 1.2273 versus 1.2377 versus
1.24573 versus 1.2502 versus 1.2404 versus 1.2402 versus 1.23832 versus
1.24308 versus 1.24159 versus 1.24340 versus 1.23083 versus 1.22567


USD/JPY: 107.362 versus 107.267. Trying to break higher out of a tight
weeklong lateral move.

Historical: 107.267 versus 106.882 versus 106.873 versus 107.09 versus
107.16 versus 106.939 versus 107.11 versus 106.816 versus 106.797 versus
105.901 versus 106.286 versus 106.81 versus 105.397 versus 105.473 versus
104.789 versus 104.829 versus 105.892 versus 106.478 versus 105.945 versus
105.946 versus 106.344 versus 105.846 versus 106.42 versus 106.335 versus
106.77 versus 106.41 versus 106.105 versus 105.752 versus 106.359 versus
105.734 versus 106.03 versus 106.695 versus 107.381 versus 106.96 versus
106.886 versus 106.85 versus 107.581 versus 107.435 versus 106.294 versus
106.153 versus 106.782 versus 107.77 versus 108.669 versus 108.669


Oil: 67.39, +0.32. Nice break higher off the 50 day MA to a higher high,
moving past the last January peak.


Gold: 1347.90, +6.00. Broke higher Wednesday but then fell, only to start
to rebound Friday. A 2.5 month base looks close to breaking out.


MONDAY

The big news Friday was the Syria 'coalition' strikes. Russia claims it
shot down 70-something of around 100 missiles and little damage done. The
Pentagon says it hit all targets. Both could be true the way they phrase
things.

The worry is that causes some further brouhaha, but it helped when Trump's
defense minister said the strikes were a 'one time thing.' Later Trump
stated it was 'mission accomplished.' Now I know that phrase has dubious
meaning what with the Bush II forays into nation building, but in this
situation I am pretty sure it can be taken to mean as a message to Russia
that we are not going to launch further strikes based upon the chemical
poisoning claims.

With the selloff ahead of earnings, the start of the move higher, the lower
volume on the downside sessions, and the ability to thus far shake off
geopolitics, we are still looking for the move upside to continue.

That means a move through the 50 day MA's for the indices as they follow
RUTX and its move into earnings. NFLX gets things going with its results
Monday after the close. LRCX is Tuesday after the close. Some important
names announcing early to try and get the market moving into the first
couple of weeks of the season. These initial earnings will be important for
the move, and we anticipate holding some of the positions on NFLX, LRCX and
of course see if they can carry the rest of the market, and our other
positions higher.

Therefore, though we have several new positions as of last week, there are
plenty of very good-looking stocks still in very good position to make moves
higher.

Have a great weekend!

End part 1 of 3
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Saturday, April 07, 2018

The Daily, Part 1 of 3, 4-7-18

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4/07/2018 Investment House Daily
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Market Summary Video, Plays and Play Videos, and Play Table with play
annotations will issue Wednesday, Weekend.

Monday a Market Summary video, new plays, play table annotations.

Tuesday and Thursday reports will contain the market summary, chart links to
view the index charts, and updated play table.

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

- Another tit in the tit for tat trade blustering and some weak jobs end a
weak 3-day bounce.
- A lack of strong buyers along with a lack of strong sellers leave the
indices in the same place for a second week.
- There are some great leadership stocks, just not enough.
- Earnings are next on tap and expectations are for a great season that will
repair the market. That is the problem, the expectations.
- Stocks are lower heading into earnings season and that provides
opportunity even if an earnings bounce ultimately cannot hold.

The past week did little but establish there are not many buyers in the
market. Not many sellers either, somewhat surprising given all the
negatives you hear from the financial stations each day.

The lack of buyers shows up with the sessions the market did rally. When
the market managed to cobble together gains as it did on the Tuesday to
Thursday, the move showed low volume and narrow breadth. As soon as a
negative story hit, the bids were pulled and stocks slid back, e.g. Friday.
More proposed Trump tariffs scuttled the advance and stocks started lower
and closed lower.

SP500 -58.37, -2.19%
NASDAQ -161.44, -2.28%
DJ30 -572.46, -2.34%
SP400 -1.97%
RUTX -1.92%
SOX -3.06%
NASDAQ 100 -161.63

VOLUME: NYSE +17%, NASDAQ +10%. Ah, once again stronger volume on the
downside than upside, but -- it is also with the indices holding support
again. When a stock or index holds support on volume and coming off the lows
some, that is not terrible action. Okay, a bit of a positive spin there,
but one silver lining is not bad.

ADVANCE/DECLINE: NYSE -3.7:1; NASDAQ -3.6:1. Of course breadth is much
stronger on the downside than up. That is the MO of this market.

When the market sold, however, there was no groundswell of volume indicating
the sellers were pouring in to ravage the market. Monday stocks sold but
volume remained light. Friday they sold again but volume, while higher, was
still below average. The selling was just not that heavy; more as if the
modest bids that led to the low volume rise on the week were pulled and
stocks slid back. The sellers are there, the buyers are there, but both are
in rather small numbers right now.

The result is the indices basically maintained their positions after a week
of volatility. The week should have shown which side would win out as SP500
and DJ30 had tested the February lows while NASDAQ tested is 2016 trendline.
When the bounce came, however, there was no internal strength as noted, and
on the first seriously adverse story, it fell back.

The inability to bounce suggests the upside does not have the chops to
sustain a move. Given the thinner leadership that makes sense, but it does
not mean the move has to fail. The inability to hold a move when bouncing
off a key low is not good action, but the up and down movement over the
February lows the past two weeks actually allows a thin group of leaders to
expand by improving their patterns and thus developing the kind of
leadership and stamina needed to hold a move may eventually emerge.

It is rather clear where the battle lines are drawn. For DJ30 and SP500 it
is the February lows and the 200 day SMA. For NASDAQ it is the 2016
trendline and the 200 day SMA. SOX is working the channel line and the 200
day SMA. SP400, the trendline and the 200 day SMA. Ditto RUTX.

Those are the battle lines, but for now neither side has the army big enough
to overrun the other. A positive for the upside is that after a dramatic
thinning of leaders, they are on the return with some well-known names
coming back to the fore along with some new or perhaps semi-new sectors.
Another positive is that despite all of the negatives impacting the stock
market (tariff threats, slowing economic data (e.g. consumer spending, jobs
report), Fed in a semi-tightening mode) and every opportunity to break
stocks down, the sellers could only hold the indices at support.

Positives for the downside include the failed bounce attempts off key
support, the lack of broad market leadership, and no quick resolution to the
news stories negative to stocks, a main one being the tariff story and its
loose cannon status.

That leaves stocks heading into next week in the same position as this week:
at support, still looking to see if they can bounce. Earnings season gets
underway and after a series of negative stories failed to take stocks lower,
could this finally bring the bids back? The time at support has allowed
some more patterns to develop, and the longer it holds and more patterns set
up, the better the upside potential.

Sure not many feel positive about the market's situation with all the
selling, the headwinds, and the inability to hold a bounce. But if the
sellers cannot take it lower despite all of this, out of the negativity a
good earnings season can cause a very tradable bounce. Certainly stocks are
lower heading into the season, leaving upside room versus being targets
sitting on big moves.

We will see. If upside patterns continue to develop in good stocks, then
they have the opportunity to show us they can make the moves. If earnings
disappoint it could get ugly -- blaming tariff talk could be a line we hear
a lot regarding guidance. That is okay, however. If stocks make the breaks
higher from good patterns on volume, then that is the signal. If they don't
and then break down, we play the break lower at that point because . . . the
pattern will be resolved.


THE MARKET

CHARTS

DJ30: A second week bouncing around the February lows, indeed undercutting
the February low intraday Monday. All the while DJ30 danced at the 61%
Fibonacci retracement of the September to January rally, as well as the 200
day SMA. Two weeks at these levels, perhaps getting a bit too long. Did
try to bounce starting Tuesday and through Thursday, but had no volume or
breadth. Now with the Friday drop DJ30 starts over to try again, but no
doubt it like gives it a shot. Note how it came off the low after tapping
the 61% dead on. Double bottoms at this level have a good history, if all
remains equal, of rallying nicely.

SP500: Very similar to DJ30, also spending a second week near the February
lows, undercutting the closing low Monday through Wednesday on the intraday
lows. It held at the February closing low and the 200 day SMA, and tapped
the 78% Fibonacci retracement on the Monday intraday low before rebounding,
just as it did on that big intraday drop in early February. Thus, basically
the same as DJ30, just at a lower Fibonacci retracement, also a good level
to double bottom and rebound.

NASDAQ: NASDAQ tested down to the early February closing low starting
Monday, and that put in the low for the week though it was tested Tuesday
and Wednesday. On the closes, NASDAQ held very near the trendline from
early 2016. It also held over the still rising 200 day SMA on the lows.
Not a double bottom as explained last week given the higher March high, but
it is in a channel outlined by the highs and lows this year. Perhaps it
will adjust into a new, larger channel than the prior tight one that was of
course aided by the FOMC's spoon feeding the market.

SOX: Very similar to NASDAQ, working in a wider channel but this channel has
held together the past 6 months. Over the rising 200 day SMA, testing the
same as early February. Can put a higher low and continue higher. If it is
going to do it, time to do it.

SP400: Two weeks over the 200 day SMA, holding that level just as in early
February. SP400 looks very sluggish here but it is still trending higher.

RUTX: Sold to the 200 day SMA with the Monday flop, rallied Tuesday to
Thursday, then Friday rolled back over. Okay, RUTX is very similar to
SP400, i.e. sluggish but can put in a higher low at the rising 200 day SMA.
Small caps are economically sensitive and they are struggling, not near
leading the market.


LEADERSHIP

There are stocks improving their looks and some actual breaks higher on the
week, breaks on good volume. One notable aspect is that in many situations
there are a small number of stocks in a sector that are showing good action.
That shows just how undecided the market is when only stocks here and there
are forming up more bullish patterns. The slight increase in leadership
stocks is in part due to that two weeks of holding support and working up
and down, buying time to form up. In order to sustain a move higher, the
market will need more leadership to step up, however, and right now they are
not lining up.

FAANG: Pretty much toothless at this juncture, at least for the upside.
NFLX still has some starch in it, holding at the late January high/50 day
MA, but it has to make the new move. AMZN bounced up to the 50 day MA after
gapping below it late March. Recovered, now looks weak. AAPL is still
slogging through the trading range. FB remains in purgatory. GOOG is
trying to hold the 200 day SMA. Trying. It looks very much as if this
group's leadership mojo is gone.

Chips: Hard to find anything that is really positive. INTC is still
working at the 50 day MA, attempting to shake off a downgrade. MU was
downgraded as well and extended its pullback. KLIC is not bad but far from
'buy me' position. ON fell off a higher high in early March but is now
approaching its lower channel line and could bounce. LRCX is bunching up
over the 200 day SMA and near the 78% Fibonacci retracement. NPTN is
working on a pattern. None of these are in great position right now, and
many chips that were decent are sinking, e.g. XLNX.

Energy: A few are trying to set up. DO, MRO, HAL -- a few.

Tech: NTNX still solid. STX not bad with a 2 week move over the 50 day MA.
AKAM (internet) still good at the 50 day MA. PANW testing a good move.
CREE remains in a nice pattern.

Retail: Off Friday in many cases, but still solid. M testing a 2-day move
as is DDS. TJX tested a 3-day move. BKE, ZUMZ are working well.

Drugs/Healthcare: DVAX nice cup. HIIQ is looking good again.

Construction: FLR is interesting. DHI, PHM in residential construction
have intriguing patterns.

Misc: Z, HLF, TRIP. These still look good but have to show a move that
sticks.


MARKET STATS

DJ30
Stats: -572.46 points (-2.34%) to close at 23932.76

Nasdaq
Stats: -161.44 points (-2.28%) to close at 6915.11
Volume: 2.36B (+10.28%)

Up Volume: 702.08M (-717.92M)
Down Volume: 1.63B (+936.82M)

A/D and Hi/Lo: Decliners led 3.58 to 1
Previous Session: Advancers led 1.69 to 1

New Highs: 40 (-17)
New Lows: 56 (+30)

S&P
Stats: -58.37 points (-2.19%) to close at 2604.47
NYSE Volume: 879.4M (+16.69%)

A/D and Hi/Lo: Decliners led 3.69 to 1
Previous Session: Advancers led 2.72 to 1

New Highs: 31 (-20)
New Lows: 55 (+30)


SENTIMENT INDICATORS

VIX: 21.49; +2.55
VXN: 27.43; +2.40
VXO: 22.93; +2.95

Put/Call Ratio (CBOE): 1.03; +0.18


Bulls and Bears: Bulls dove, bounced, then dove once more. Getting a bit
out of the stratosphere, a good thing to happen, but not that low yet.
Bears are up, but still relatively weak compared to bulls.

Bulls: 49.5 versus 55.5

Bears: 17.5 versus 16.8

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: 49.5 versus 55.5
55.5 versus 54.9 versus 48.6 versus 48.1 versus 48.5 versus 41.9 versus 54.4
versus 66.00 versus 64.7 versus 66.7 versus 64.4 versus 61.9 versus 64.1
versus 64.2 versus 62.3 versus 61.5 versus 63.5 versus 64.4 versus 63.5
versus 62.3 versus 60.6 versus 60.4 versus 57.5 versus 54.3 versus 50.5
versus 47.1 versus 49.5 versus 49.5 versus 48.1 versus 50.5 versus 57.5
versus 60.0 versus 60.2 versus 57.8 versus 50.0 versus 52.5 versus 54.9
versus 51.5 versus 50.00 versus 55.8 versus 50.00 versus 51.9 versus 58.1
versus 58.7 versus 58.5 versus 54.7 versus 51.9 versus 56.3 versus 55.8
versus 49.5

Bears: 17.5 versus 16.8
16.8 versus 15.7 versus 15.5 versus 14.4 versus 14.6 versus 14.4 versus 15.5
versus 12.6 versus 12.8 versus 12.7 versus 13.5 versus 15.2 versus 15.1
versus 15.2 versus 15.1 versus 15.1 versus 15.4 versus 15.4 versus 14.4
versus 14.4 versus 15.1 versus 15.2 versus 15.1 versus 17.0 versus 17.1
versus 19.0 versus 20.2


OTHER MARKETS

Bonds: 2.775% versus 2.812%. Of course the trade worries and jobs report
bounced bonds again. After a week pulling back to test the 50 day MA after
breaking over it, a bounce upside Friday in an attempt to continue the new
rally off the February low.

Historical: the last sub-2% rate was in November 2016 (1.867%). 2.812%
versus 2.806% versus 2.781% versus 2.739% versus 2.714% versus 2.781% versus
2.775% versus 2.854% versus 2.813% versus 2.814% versus 2.881% versus 2.90%
versus 2.852% versus 2.826% versus 2.819% versus 2.844% versus 2.866% versus
2.896% versus 2.872% versus 2.879% versus 2.863% versus 2.879% versus 2.868%
versus 2.799% versus 2.875% versus 2.893% versus 2.864% versus 2.866% versus
2.934% versus 2.952% versus 2.893% versus 2.873% versus 2.904% versus 2.913%
versus 2.833% versus 2.857% versus 2.8577% versus 2.844% versus 2.813%
versus 2.805% versus 2.707% versus 2.841% versus 2.792%


EUR/USD: 1.22812 versus 1.2247. Euro continues in its 3 month lateral
range around the 50 day MA.

Historical: 1.2247 versus 1.2285 versus 1.22698 versus 1.23073 versus
1.23234 versus 1.2406 versus 1.24494 versus 1.2351 versus 1.23301 versus
1.23467 versus 1.22478 versus 1.2342 versus 1.2287 versus 1.2304 versus
1.23782 versus 1.2392 versus 1.23412 versus 1.2305 versus 1.2305 versus
1.24017 versus 1.2411 versus 1.2344 versus 1.23187 versus 1.22822 versus
1.21894 versus 1.21893 versus 1.23257 versus 1.2296 versus 1.2324 versus
1.22820 versus 1.23431 versus 1.2411 versus 1.25083 versus 1.2450 versus
1.23528 versus 1.22887 versus 1.22524 versus 1.2273 versus 1.2377 versus
1.24573 versus 1.2502 versus 1.2404 versus 1.2402 versus 1.23832 versus
1.24308 versus 1.24159 versus 1.24340 versus 1.23083 versus 1.22567


USD/JPY: 106.939 versus 107.11. Dollar bounced starting late March with
the tariff talk, and last week it broke over the 50 day MA's, testing the
move Friday.

Historical: 107.11 versus 106.816 versus 106.797 versus 105.901 versus
106.286 versus 106.81 versus 105.397 versus 105.473 versus 104.789 versus
104.829 versus 105.892 versus 106.478 versus 105.945 versus 105.946 versus
106.344 versus 105.846 versus 106.42 versus 106.335 versus 106.77 versus
106.41 versus 106.105 versus 105.752 versus 106.359 versus 105.734 versus
106.03 versus 106.695 versus 107.381 versus 106.96 versus 106.886 versus
106.85 versus 107.581 versus 107.435 versus 106.294 versus 106.153 versus
106.782 versus 107.77 versus 108.669 versus 108.669


Oil: 62.06, -1.48. After bumping the January high two weeks back, oil has
faded and now is fighting to hold the 50 day MA.


Gold: 1336.10, +7.60. Gold tested again on the week, now a 2 week test to
the 50 day MA, attempting to put in a higher low and take on resistance at
1360-65.


MONDAY

Jobs are out of the way and were less than impressive. As I noted last
week, two weeks back, a month back, the US economy has hit a slow spot. It
is likely just a slow spot, but you have to keep watch on the small and
midcaps as they are lagging the rest of the market, and if the tax cuts are
going to kick in and help the economy you would anticipate they would bottom
and start to move back up.

Nearer term there are a couple of competing forces.

Earnings are here and I have heard many, many commentators talk about how
earnings are going to right the market's ship because there is expected 16%
to 19% growth. Okay, great, but those are the expectations. Earnings tend
to work best when expectations are not too grand then companies blow by them
as did FAANG in October 2017. Expectations, the same as gravity as Mountain
Rescue climber Hal noted in the movie 'Cliffhanger,' can be a b**ch. It
sets the bar high and it is a lot easier to disappoint.

On the other hand, stocks deflated valued ahead of earnings and that gives a
nice on ramp to higher prices if earnings are solid and the general
conditions are upbeat. Ah, if general conditions are upbeat. If this
market volatility after a long run upside is forecasting economic issues
then earnings, though they might provide a very tradable rebound from the
recent dip, would not rescue the market. The market looks ahead and
earnings are the past.

The second competing force is leadership. The market can bounce on earnings
given the pullback heading into the season. If the move is going to sustain
then it must have leadership. There is still not enough leadership. The
two weeks bouncing up and down at support has improved some patterns, but
frankly we don't see enough good patterns in sectors that provide leadership
for true moves higher. You need growth to help lead, whether that is growth
in tech, small caps/midcaps, or even the large caps selling to the rest of
the world (e.g. CAT). There are definitely growth stocks in leadership
positions with good patterns. There are just not a ton of them and we are
not seeing a lot developing in the wings. That is a major debilitating
factor for any move higher on earnings.

Thus, this setup ahead of earnings is one that can easily lead to an
earnings bounce. After that, however, unless more and more stocks set up a
bit better and make good upside breaks, any rebound is likely limited in its
height and duration. Certain things have to happen for a market to sustain
a break higher, and leadership is a critical element. Perhaps there are
some groups out there we have discounted too much that will suddenly pull it
all together and lead. That would be awesome and of course we would spot
them quickly. We will watch for those, but if they are forming up right now
they are doing so with very good camouflage.

Therefore, we are going to look at upside for that earnings move higher,
using in many cases stocks we already have on the report. Why? Because they
are the better patterns and this market is short on upside patterns. Energy
needs to show up, software would help, security software is trying to set up
and some are moving, homebuilders are interesting -- but work needs to be
done. Upside plays into earnings season? Yes. Downside plays on deck if
the 2 weeks of bouncing at support fails? Yes as well.

Have a great weekend!

End part 1
_______________________________________________________
Customer Support: http://www.InvestBilling.com
1153 Bergen Pkwy - Suite I #502 - Evergreen, CO 80439

Saturday, March 31, 2018

The Daily, Part 1 of 3, 3-30-2018

* * * *
3/30/2018 Investment House Daily
* * * *

Investment House Daily Subscribers:

MARKET ALERTS:

Targets hit: None issued
Entry alerts: AMAG
Trailing stops: None issued
Stop alerts: YNDX

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 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
********************************************************************

The REPORT SCHEDULE is as follows:

Market Summary Video, Plays and Play Videos, and Play Table with play
annotations will issue Wednesday, Weekend.

Monday a Market Summary video, new plays, play table annotations.

Tuesday and Thursday reports will contain the market summary, chart links to
view the index charts, and updated play table.

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

- DJ30, SP500 hold again at support, start to move higher.
- A bounce on volume to end the week and quarter, but was it just the
quarter end driving the action?
- Bounce or no, the market is in need of a few, indeed more than a few, good
leaders.

After another down week the market indices posted gains Friday on some
better volume. They held where the needed, DJ30 and SP500 at the February
closing lows, NASDAQ at one of the early 2016 trendlines. Some leaders held
the 50 day EMA and rebounded a bit, e.g. NFLX, SQ, LRCX, MU, INTC.

SP500 35.87, 1.38%
NASDAQ 114.21, 1.64%
DJ30 254.69, 1.07%
SP400 1.35%
RUTX 1.08%
SOX 2.24%
NASDAQ 100 1.86%


VOLUME: NYSE +2%, NASDAQ +7.5%. Solid above average trade on NASDAQ after a
jump in trade Wednesday as it tested the 2016 trendline. That holds some
promise similar to how NASDAQ bounced off the trendline in early February.
NYSE trade moved above average as NYSE recaptured the 200 day SMA and SP500
moved up off the 200 day. As with NASDAQ, SP500 showed similar action on
the February intraday low that tapped the 200 day and reversed on rising,
above average volume.

ADVANCE/DECLINE: NYSE +3.6:1, NASDAQ +2.2:1.


Was this the start of a bounce from support similar to the NASDAQ and SP500
February bounces from similar support levels as noted above, OR was it
simply end of the quarter ahead of a 3-day market holiday position squaring?

The answer to that question will play out this week. There needs to be more
leadership in the market, pure and simple. Some of those names above, e.g.
MU, NFLX, are at the 50 day MA that should act as support and perhaps they
move up from there to lead a rally. Many stocks that were recently leaders
or leader wannabes, however, don't have the patterns, at the moment, to
lead. If the market bounces gratis some leaders such as MU, then they can
have time to work on rebuilding their patterns. Again, that will play out
in the coming week and next.

The gist of last week was a test of the February lows on DJ30 and SP500 as
well as a hold of those lows, i.e. they did not sink lower. Now they have
to show the new break higher. Thursday was an upside relief session, but
again, with the quarter end you cannot put that much faith in it. If good
quality stocks start breaking higher and provide the move support, then the
historical pattern of corrections in otherwise good economies and markets
holds. If not, then the economy is likely not as strong as believed or
there is some other issue out there the stock market is worried about, e.g.
war -- trade or otherwise -- political upheaval, etc.


CHARTS

DJ30: After piercing lower to almost the February intraday low the prior
Friday, The Dow held at the February closing low as a floor all last week.
That keeps the Dow over the 200 day, at the prior lows, and the 61%
Fibonacci retracement of the September to January rally. Lots of support,
lots of reasons to hold and rally based upon this pattern. Now it shows if
it can.

SP500: Very similar to DJ30, testing the February closing low the prior
Friday, holding over that level all last week. In addition, that keeps
SP500 over the 200 day SMA and a potential double bottom near the 78%
Fibonacci retracement. The technical pattern is there, but SP500 needs to
find the leadership.

NASDAQ: Tried to rally early week, failed as a lot of its leaders broke
their patterns. Faded to the uptrend from early 2016, held it Wednesday on
strong volume, rallied Thursday on strong volume. NASDAQ can hold its
uptrend if it finds some leaders. NFLX, GOOG, INTC are possibilities, but
others such as NVDA just do not look that good. NASDAQ could stand to find
some other stocks to lead. STX is not NASDAQ, but it is tech and is in good
shape.

SOX: Three week fade off the top of channel trendline. No doubt that acted
as resistance and sent SOX lower. It is below the closer trendline, now at
a lower trendline off the August low. At this point everyone is watching
for where SOX makes its stand. Can do it here, will need INTC, LRCX, MU to
make good on some good patterns.

RUTX: Not many good things to say about RUTX other than it held the early
March low and the October peak. The pattern is not generating warm fuzzies
as it has a head and shoulder-ish look.

SP400: Very similar to RUTX but it is holding over the 200 day SMA and a
trendline off the August and February lows. Some possibility there with
this test, but at this juncture it will have to show it -- just as all the
indices.


LEADERSHIP

FAANG: With FB under heavy scrutiny and AMZN feeling the problems of a
President that doesn't like you, FAANG is struggling. AAPL is still
range-bound. NFLX is pretty decent at the 50 day EMA. GOOG is trying to
put in a bounce at the 200 day SMA and off the summer range highs.

Chips: Struggled as a group the past three weeks after SOX hit the top of
the range and some are not in great shape. MU is solid, NPTN is breaking
higher. INTC continues looking good. LRCX is trying to bounce off the 78%
Fibonacci retracement. KLIC looks very interesting in an inverted head and
shoulders. Some solid patterns there; they need to take the lead.

Biotechs/Drugs: Ran into trouble. There are some that are setting up, e.g.
TLGT. Drug-related stocks are working, e.g. AMAG, and now IDXX is setting
up.

Retail: Continues to look better with the President taking shots at AMZN.
DDS still looks solid to move higher. TJX, TLRD, M, KSS as well. If they
can continue it looks as if we will be buying retail. What about AMZN? It
gapped below the 50 day MA's and has yet to recover.

China: As with many sectors, Chinese stocks have some solid leaders, e.g.
ATHM, QIWI, BZUN. BABA has possibilities as it looks as if it is going to
move higher off a higher low. Others are really struggling, e.g. NTES,
BIDU, SINA, SOHU. Hot or cold.

Metals: A bit of an interesting look to keep watching, e.g. STLD, FCX. SCHN
has a potential double bottom at the 61% Fibonacci retracement. FCX is
showing one at the 61% Fibonacci retracement.

Oil: Remains in the game. MRO shook us out Wednesday but was back in the
game Thursday. APC is not bad. Many are, however.

MISC: HLF remains ready to move. SQ is holding the 50 day MA's and could
be a new entry.


MARKET STATS

DJ30
Stats: +254.69 points (+1.07%) to close at 24103.11

Nasdaq
Stats: +114.22 points (+1.64%) to close at 7063.44
Volume: 2.59B (+1.97%)

Up Volume: 1.76B (+836.25M)
Down Volume: 792.28M (-797.72M)

A/D and Hi/Lo: Advancers led 2.23 to 1
Previous Session: Decliners led 1.24 to 1

New Highs: 45 (+19)
New Lows: 80 (-33)

S&P
Stats: +35.87 points (+1.38%) to close at 2640.87
NYSE Volume: 995.465M (+7.39%)

A/D and Hi/Lo: Advancers led 3.6 to 1
Previous Session: Advancers led 1.08 to 1

New Highs: 33 (+14)
New Lows: 59 (-55)


SENTIMENT INDICATORS

VIX: 19.97; -2.90
VXN: 26.68; -3.51
VXO: 22.05; -1.74

Put/Call Ratio (CBOE): 0.95; -0.39


Bulls and Bears: Bulls dove, bounced, then dove once more. Getting a bit
out of the stratosphere, a good thing to happen, but not that low yet.
Bears are up, but still relatively weak compared to bulls.

Bulls: 49.5 versus 55.5

Bears: 17.5 versus 16.8

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: 49.5 versus 55.5
55.5 versus 54.9 versus 48.6 versus 48.1 versus 48.5 versus 41.9 versus 54.4
versus 66.00 versus 64.7 versus 66.7 versus 64.4 versus 61.9 versus 64.1
versus 64.2 versus 62.3 versus 61.5 versus 63.5 versus 64.4 versus 63.5
versus 62.3 versus 60.6 versus 60.4 versus 57.5 versus 54.3 versus 50.5
versus 47.1 versus 49.5 versus 49.5 versus 48.1 versus 50.5 versus 57.5
versus 60.0 versus 60.2 versus 57.8 versus 50.0 versus 52.5 versus 54.9
versus 51.5 versus 50.00 versus 55.8 versus 50.00 versus 51.9 versus 58.1
versus 58.7 versus 58.5 versus 54.7 versus 51.9 versus 56.3 versus 55.8
versus 49.5

Bears: 17.5 versus 16.8
16.8 versus 15.7 versus 15.5 versus 14.4 versus 14.6 versus 14.4 versus 15.5
versus 12.6 versus 12.8 versus 12.7 versus 13.5 versus 15.2 versus 15.1
versus 15.2 versus 15.1 versus 15.1 versus 15.4 versus 15.4 versus 14.4
versus 14.4 versus 15.1 versus 15.2 versus 15.1 versus 17.0 versus 17.1
versus 19.0 versus 20.2


OTHER MARKETS

Bonds: 2.714% versus 2.781%. Bonds continue rallying after breaking up
through the 50 day MA's.

Historical: the last sub-2% rate was in November 2016 (1.867%). 2.781%
versus 2.775% versus 2.854% versus 2.813% versus 2.814% versus 2.881% versus
2.90% versus 2.852% versus 2.826% versus 2.819% versus 2.844% versus 2.866%
versus 2.896% versus 2.872% versus 2.879% versus 2.863% versus 2.879% versus
2.868% versus 2.799% versus 2.875% versus 2.893% versus 2.864% versus 2.866%
versus 2.934% versus 2.952% versus 2.893% versus 2.873% versus 2.904% versus
2.913% versus 2.833% versus 2.857% versus 2.8577% versus 2.844% versus
2.813% versus 2.805% versus 2.707% versus 2.841% versus 2.792%


EUR/USD: 1.23234 versus 1.2302. Still in the lateral move along the 50 day
MA.

Historical: 1.23234 versus 1.2406 versus 1.24494 versus 1.2351 versus
1.23301 versus 1.23467 versus 1.22478 versus 1.2342 versus 1.2287 versus
1.2304 versus 1.23782 versus 1.2392 versus 1.23412 versus 1.2305 versus
1.2305 versus 1.24017 versus 1.2411 versus 1.2344 versus 1.23187 versus
1.22822 versus 1.21894 versus 1.21893 versus 1.23257 versus 1.2296 versus
1.2324 versus 1.22820 versus 1.23431 versus 1.2411 versus 1.25083 versus
1.2450 versus 1.23528 versus 1.22887 versus 1.22524 versus 1.2273 versus
1.2377 versus 1.24573 versus 1.2502 versus 1.2404 versus 1.2402 versus
1.23832 versus 1.24308 versus 1.24159 versus 1.24340 versus 1.23083 versus
1.22567


USD/JPY: 106.286 versus 106.81

Historical: 106.81 versus 105.397 versus 105.473 versus 104.789 versus
104.829 versus 105.892 versus 106.478 versus 105.945 versus 105.946 versus
106.344 versus 105.846 versus 106.42 versus 106.335 versus 106.77 versus
106.41 versus 106.105 versus 105.752 versus 106.359 versus 105.734 versus
106.03 versus 106.695 versus 107.381 versus 106.96 versus 106.886 versus
106.85 versus 107.581 versus 107.435 versus 106.294 versus 106.153 versus
106.782 versus 107.77 versus 108.669 versus 108.669


Oil: 64.94, +0.56. Setting up a handle to a 2 month cup, forming up right
below the January peak.


Gold: 1327.30, -2.70.


MONDAY

After 3 days off and the quarter end there are a few things to watch for.

First, does new money enter and help keep the Thursday move alive. Higher
volume gains that session, but that could be due to adjusting positions
ahead of quarter end. New money is good and needed, but it can run out
after a session or two.

Second, do gains hold versus the high to low action.

Third, does volatility calm down. That shows the buyers and sellers are
resolving their issues. Of course volatility can end with stocks rallying
or selling off. One side or the other will win out.

Fourth, do leaders emerge upside? Will new leaders, perhaps from metals or
drug-related , emerge? Will current leaders testing key levels reengage as
leaders? A market rally has to have leadership. A market can start a
rally, but if significant leadership fails to emerge, the rally fails as
well. Will MU, HLF, STX, NFLX, metals, drugs, retail emerge to lead?

Okay, plenty to watch for but the Dow and SP500 have set up in the double
bottom at the early February lows at the 61% and 78% Fibonacci retracement,
respectively. If these leadership stocks start to make a new break higher
with volume, we will play them based upon their patterns and the index
patterns.

Have a great weekend!

End part 1
_______________________________________________________
Customer Support: http://www.InvestBilling.com
1153 Bergen Pkwy - Suite I #502 - Evergreen, CO 80439

Sunday, March 25, 2018

The Daily, Part 1 of 3, 3-24-18

* * * *
3/24/2018 Investment House Daily
* * * *

Investment House Daily Subscribers:

MARKET ALERTS:

Targets hit: None issued
Entry alerts: None issued
Trailing stops: None issued
Stop alerts: None issued

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

********************************************************************

The REPORT SCHEDULE is as follows:

Market Summary Video, Plays and Play Videos, and Play Table with play
annotations will issue Wednesday, Weekend.

Monday a Market Summary video, new plays, play table annotations.

Tuesday and Thursday reports will contain the market summary, chart links to
view the index charts, and updated play table.

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

- Stocks make the mistake of trying to rally early, pay for it with another
large decline.
- DJ30 at the February lows, SP500 at the doorstep as the test is on.
- After all this selling there are stocks, very good stocks, still in
position to rally after a routine test if the indices can find bottom at the
February lows.

Friday stocks sold again, not early as wanted as the Dow actually started
positive. Indeed, it rallied upside around 140 points. All that did was
give the sellers their shot and they took it. The Dow reversed 575 points
high to close.

SP500 -55.43, -2.10%
NASDAQ -174.01, -2.43%
DJ30 -424.69, -1.77%
SP400 -1.94%
RUTX -2.19%
SOX -3.29%
NASDAQ 100 -2.61%

VOLUME: NYSE +11%, NASDAQ +1%. NYSE trade higher but still just barely
above average. NASDAQ trade above average for a second session and a bit
higher, really picking up Thursday and Friday.

ADVANCE/DECLINE: NYSE -4:1, NASDAQ -3.7:1. Solid again but still not
blowout that a -10:1 reading shows you.

Ugly move, panic was induced. Heard the afterhours financial stations
talking about the selling. We heard the phrase that pays: this is different
from the early February selling, a pundit explained, because the news was
different: tariffs, changes in the Trump administration that were more
confrontational, raising the risk of confrontation.

Ah, the old 'it's different this time' statement. When you hear it in
conjunction with ugly selling, it has meaning. Usually that means it is not
different this time. Whatever the cause, humans react the same way. Thus
the machines they program with their trading styles react the same way.
That means that patterns typically work and repeat the past.

Is there a pattern? We think so. There is the test of the prior low that
so often happens after some serious downside. There is also a pattern
setting up. There are also still stocks in quite good position despite the
2 weeks of selling and this week's gash lower.

Okay, so how about a closer look at the Dow. The 575 point high to low move
took the Dow below the February closing low and within 173 points of the
intraday low. That also takes DJ30 just over the 200 day SMA (23,357;
closed at 23,533). It also puts DJ30 at the October/November lateral
consolidation. Further, that has the Dow back near the 61% Fibonacci
retracement of the September 2017 to late January all-time high.

Meaning? You look for a test of the prior low at key levels. You look for
a pattern to establish. Key levels: 61% Fibonacci retracement, prior
February low, October/November consolidation, 200 day SMA. Pattern:
potential double bottom. Potential because the Dow is at the level, but it
is not showing signs of slowing the selling as of the Friday close. That
likely comes early next week with a reach lower that then recovers to a doji
near these support levels.

That is the outline.

SP500 is very similar as DJ30 and SP500 have moved rather lockstep though
DJ30 is the weaker. SP500 is spot on the February closing low and the 200
day SMA. It is also putting in its own potential double bottom just over
the 78% Fibonacci retracement of the September to January rally. Closed on
the low so no indication of a bounce yet, but lots of support at this level.
A dip lower, recovery to a doji or better is a good bottoming indication.

SP400 midcaps are near the 200 day SMA and the October/November 7 week
consolidation. Still well above the closing and intraday lows from
February.

NASDAQ broke its December to March trendline and is 72 points from the
longer term trendline from early 2016. It is also closing in on the 50%
Fibonacci retracement of the September to January run. That trendline is
going to be important, particularly if DJ30 and SP500 fall early week and
reverse at the February lows. NASDAQ could then put in a higher low, albeit
not that much higher than the February closing low.

SOX broke the 50 day MA and the lower channel line Friday. It is still al
long way from the February low -- it was the market leader so it put in a
lot of upside. With DJ30, SP500 at the February lows already, if they
reverse SOX will be in position to lead again.

RUTX exploded lower Friday in a move made dramatic by how well it had held
up to then. Broke the October high, still holding over the early March low
hit on that dip/test of the initial move off the February low. Pretty
amazing drop, at some support, kind of problematic now after holding up so
well.


Why the detailed index rundown right out of the gate? You have to start
looking for reversals after this kind of selling, and particularly when the
indices get near the prior selloff low. Different this time? It could be,
but we are not playing it as different.


LEADERSHIP

FAANG: AMZN and NFLX started showing cracks as the former broke the 20 day
EMA and is halfway to the 50 day MA on strong volume. NFLX broke the 20 day
but volume remained well below average. Testing, not breaking. FB sold hard
again; broken. AAPL is almost to the 200 day SMA; back to the drawing board
for it in its 5 month range. GOOG dove lower again and is near the 200 day
SMA. At least it is near a potential support level.

Chips: Not all candy and nuts with some big names breaking lower, e.g. MU,
AMAT. XLNX sold to the 50 day EMA in one move from the 20 day. LRCX is a
the 50 day EMA. INTC broke the 20 day MA though is not tanking. SMTC is
back to testing the 10 day EMA. ON at the 20 day. Many are starting to
sell harder and we will see if they find new bids to start the week.

Drugs/biotech: Smaller remains better, e.g. PTCT, IMGN, ARRY (nice 50 day
MA test). Some are not, e.g. INFI. The big names are terrible, e.g. AMGN,
BIIB.

Software: Cracking. CRM went on through the 50 day MA. RHT broke the 20
day MA; it was in need of a test. VMW is holding up relatively well. DATA
testing the 50 day MA.

Retail: Holding up better than most. DDS still holding a very nice test.
TJX did slip to the 50 day MA, but low volume. KSS is holding its pattern
while M fell to test the 50 day EMA in a not bad pullback. LULU not bad.
RL also holding at the 50 day MA in its consolidation.

China: Really struggling. ATHM is not bad, testing the 20 day on lighter
volume. QIWI not bad, testing a bit lower on light trade. YNDX sold Friday
to the bottom of the range but on very light trade. BABA sold hard a second
session, BIDU sold to the 200 day MA, BZUN

Transports: Very good relative strength. KSU holding well in its range.
SAIA in trucks at the 50 day. JBHT holding its pattern. Airlines cracked
Thursday and sold more Friday.

Oil: Paused after a solid Thursday move. APC surged but gave up most of
the move. MRO Testing its very nice Wednesday surge. DO testing its nice
break higher as well. Not bad.

Financial: Crushed. JPM, BAC. GS almost at the 200 day SMA already.

MISC: HLF still holding very well. GRUB holding the 20 day EMA. STX
cracked for a deeper test. SQ fell to the 20 day EMA.



MARKET STATS

DJ30
Stats: -424.69 points (-1.77%) to close at 23533.20

Nasdaq
Stats: -174.01 points (-2.43%) to close at 6992.67
Volume: 2.39B (+1.27%)

Up Volume: 425.8M (-79.16M)
Down Volume: 1.94B (+100M)

A/D and Hi/Lo: Decliners led 3.74 to 1
Previous Session: Decliners led 4.09 to 1

New Highs: 25 (-14)
New Lows: 109 (+47)

S&P
Stats: -55.43 points (-2.10%) to close at 2588.26
NYSE Volume: 1B (+11.11%)

A/D and Hi/Lo: Decliners led 3.97 to 1
Previous Session: Decliners led 4.23 to 1

New Highs: 16 (-9)
New Lows: 215 (+87)


SENTIMENT INDICATORS

VIX: 24.87; +1.53
VXN: 28.35; +1.72
VXO: 24.70; +2.59

Put/Call Ratio (CBOE): 1.54; +0.32


Bulls and Bears: Bulls rebounded, but bears saw a substantial rise in
pessimism. Bulls more bullish, bears more bearish. It would appear the
bears had the better take on it.

Bulls: 55.5 versus 54.9

Bears: 16.8 versus 15.7

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: 55.5 versus 54.9
54.9 versus 48.6 versus 48.1 versus 48.5 versus 41.9 versus 54.4 versus
66.00 versus 64.7 versus 66.7 versus 64.4 versus 61.9 versus 64.1 versus
64.2 versus 62.3 versus 61.5 versus 63.5 versus 64.4 versus 63.5 versus 62.3
versus 60.6 versus 60.4 versus 57.5 versus 54.3 versus 50.5 versus 47.1
versus 49.5 versus 49.5 versus 48.1 versus 50.5 versus 57.5 versus 60.0
versus 60.2 versus 57.8 versus 50.0 versus 52.5 versus 54.9 versus 51.5
versus 50.00 versus 55.8 versus 50.00 versus 51.9 versus 58.1 versus 58.7
versus 58.5 versus 54.7 versus 51.9 versus 56.3 versus 55.8 versus 49.5

Bears: 16.8 versus 15.7
15.7 versus 15.5 versus 14.4 versus 14.6 versus 14.4 versus 15.5 versus 12.6
versus 12.8 versus 12.7 versus 13.5 versus 15.2 versus 15.1 versus 15.2
versus 15.1 versus 15.1 versus 15.4 versus 15.4 versus 14.4 versus 14.4
versus 15.1 versus 15.2 versus 15.1 versus 17.0 versus 17.1 versus 19.0
versus 20.2


OTHER MARKETS

Bonds: 2.813% versus 2.806%. Bonds up on the week, moving to the 50 day MA,
trying to reverse trend.

Historical: the last sub-2% rate was in November 2016 (1.867%). 2.814%
versus 2.881% versus 2.90% versus 2.852% versus 2.826% versus 2.819% versus
2.844% versus 2.866% versus 2.896% versus 2.872% versus 2.879% versus 2.863%
versus 2.879% versus 2.868% versus 2.799% versus 2.875% versus 2.893% versus
2.864% versus 2.866% versus 2.934% versus 2.952% versus 2.893% versus 2.873%
versus 2.904% versus 2.913% versus 2.833% versus 2.857% versus 2.8577%
versus 2.844% versus 2.813% versus 2.805% versus 2.707% versus 2.841% versus
2.792%


EUR/USD: 1.2351 versus 1.23301. Back and forth but still in the lateral
move over the 50 day EMA.

Historical: 1.23301 versus 1.23467 versus 1.22478 versus 1.2342 versus
1.2287 versus 1.2304 versus 1.23782 versus 1.2392 versus 1.23412 versus
1.2305 versus 1.2305 versus 1.24017 versus 1.2411 versus 1.2344 versus
1.23187 versus 1.22822 versus 1.21894 versus 1.21893 versus 1.23257 versus
1.2296 versus 1.2324 versus 1.22820 versus 1.23431 versus 1.2411 versus
1.25083 versus 1.2450 versus 1.23528 versus 1.22887 versus 1.22524 versus
1.2273 versus 1.2377 versus 1.24573 versus 1.2502 versus 1.2404 versus
1.2402 versus 1.23832 versus 1.24308 versus 1.24159 versus 1.24340 versus
1.23083 versus 1.22567


USD/JPY: 104.789 versus 104.829. Broke hard lower from the 20 day EMA
Wednesday to Thursday, then held the line Friday. Already weak.

Historical: 104.829 versus 105.892 versus 106.478 versus 105.945 versus
105.946 versus 106.344 versus 105.846 versus 106.42 versus 106.335 versus
106.77 versus 106.41 versus 106.105 versus 105.752 versus 106.359 versus
105.734 versus 106.03 versus 106.695 versus 107.381 versus 106.96 versus
106.886 versus 106.85 versus 107.581 versus 107.435 versus 106.294 versus
106.153 versus 106.782 versus 107.77 versus 108.669 versus 108.669


Oil: 65.88, +1.58. Surging upside and now putting the moves on the January
peak at 66.66.


Gold: 1339.90, +22.50. Big breakout Friday toward the January and February
highs.


MONDAY

Friday did not have that opening dive we were looking for followed by short
covering. Instead it rallied then had to reverse, and there were no bids
ready in the afternoon as they were used in the morning.

Monday we watch to see if the DJ30, SP500 February lows act as support and
work a reversal. The setup is there, the historical pattern is there,
enough leaders are still in decent enough patterns to put forth a serious
leadership effort if DJ30 and SP500 are close to reversal levels. Now, if
it is only not different this time.

If there is the reversal we will be looking at leadership quality stocks
that are still in decent enough patterns over support. LRCX, ON, SMTC,
MLNX, BZUN, MRO, DO, ARRY, PANW, NTNX -- testing but in very good position.
We would even add to others such as NFLX, some China stocks, etc.

If it is different this time, there will still be a rebound move, a relief
move. After this much selling you want to play the downside after a relief
move upside fails versus attempting to get on board after Thursday and
Friday.

Have a great weekend!

End part 1 of 3
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Saturday, March 17, 2018

The Daily, Part 1 of 3, 3-17-18

* * * *
3/17/2018 Investment House Daily
* * * *

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Targets hit: None issued
Entry alerts: PII
Trailing stops: ARRY; NVDA
Stop alerts: ARRY

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Market Summary Video, Plays and Play Videos, and Play Table with play
annotations will issue Wednesday, Weekend.

Monday a Market Summary video, new plays, play table annotations.

Tuesday and Thursday reports will contain the market summary, chart links to
view the index charts, and updated play table.

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

- Expiration shows a lot of volume but still not a lot of movement.
- RUTX, SP400 show buying interest on expiration, bouncing off their tests.
- SOX, NASDAQ remain in position to try for new highs once more while SP500
and DJ30 remain quite problematic.
- If FAANG, with its current patterns, breaks higher, the entire group
likely goes higher, with chips, big tech, China stocks going as well.
- FOMC is the headline data point for the week, and a hike of 25BP is
expected.
- Lots of upside setups as the indices test the recovery moves. Can they
break higher, and if so, will the sellers re-enter and sell as on Tuesday?

And the market goes . . . nowhere. Still. Stocks tried to continue higher
early week but reversed Tuesday. NASDAQ and SOX gave up new highs. Sellers
came into the market as the leading indices hit fresh highs. Not promising.

The stock indices mostly sold the balance of the week. It was not, however,
a continuation of the Tuesday high volume selloff. Volume dropped, the
selling intensity mitigated. Indeed, after Tuesday it would be a
misrepresentation to say the selling had any intensity at all. The sellers
left, volume dropped, and stocks edged lower and laterally. After a rude
slap Tuesday with NASDAQ and SOX trying to break the top of their channels,
it was a very ordinary pullback. Ordinary and somewhat encouraging.

With SOX and NASDAQ at the top of their channels, however, the market will
have to once again defy the odds and beat the channel resistance. Thus far
they have beat the odds by avoiding a drop back to the February lows. Of
course after Tuesday they looked primed to go find them. Then the selling
intensity stalled. They are not free of that monkey on their back just yet,
but they consolidated instead of selling off, and that let a lot of stocks
form some pretty good pullbacks to support. Not new bases, just testing the
recovery runs higher. Thus, as with SOX and NASDAQ, they are in nice
consolidations, one that can break higher again, but they are also still
sitting on top of nice moves already. This has to be a real bull run to
break them all higher again. They look darn good to do it, but as noted,
they have to continue defying the odds.

Friday the indices were basically flat, except for RUTX and SP400. The
small caps and midcaps jumped nicely off the 10 day EMA and 50 day SMA,
respectively. At expiration big money was moving into domestically
sensitive areas. And it was not selling off the recent leaders either.

SP500 4.68, 0.17%
NASDAQ 0.25, 0.00%
DJ30 72.85, 0.29%
SP400 0.70%
RUTX 0.60%
SOX 0.03%
NASDAQ 100 -0.16%

VOLUME: NYSE +208%, NASDAQ +55%. Expiration, rebalance, tons of trade,
doesn't mean anything.

ADVANCE/DECLINE: NYSE +2:1, NASDAQ +1.7:1


The consensus, at least what we are reading and hearing, is that the market
is not supposed to go up anymore. The Fed is engaged in what is being
called 'quantitative tightening' (QT), it is also going to hike rates next
Wednesday and purportedly 2, maybe 3 more times this year, interest rates
are rising. There is likely more, it is just not worth reciting them.

At the same time here in the office we see a lot of patterns that look
really good to move higher. Some have not made big moves, others have put
in solid upside but have great tests in progress. While history indicates a
test of the prior lows is still a possibility, it would be foolish to ignore
good setups. The market makes a habit of not doing what everyone expects of
it. Thus we are watching these stocks and indeed buying some this past week
on the pullback when some good moves were made. We will see if those pan
out and if more join them next week off what looked to be a sharp reversal
that, at least for last week, died on the vine and allowed some really good
pullback setups.

Thursday I said the indices were at a key pullback, a lick log for some.
Still that way after Friday, though RUTX and SP400 bounced off support. We
will see if next week they can continue and other indices move with them.
Then, most importantly, can they hold any new breaks higher without getting
the Tuesday treatment. That will be the key tell for the next attempt to
move higher.


THE MARKET

CHARTS

NASDAQ/SOX: Both of these indices broke to new highs last week. SOX broke
through its upper channel line, NASDAQ likely touched what could be the
upper channel line for a new channel. Both indices faded in a sharp Tuesday
high to low reversal session. The rest of the week they were lower, but the
sellers basically left. After Tuesday there was no heavy selling. None of
the indices could hold an early gain, but there was no high volume dumping
as on Tuesday. That leaves NASDAQ and SOX in tight lateral consolidations
over the 10 day EMA and in position to defy the odds and continue with more
upside. As noted Thursday, an important time for these two indices. And
all the other indices.

RUTX: Three-session test to the 10 day EMA, a bounce Friday. Expiration,
cannot make too much of it, but it is notable that the index approached the
January high, put in a rather normal test of the 10 day, then started to
bounce as it was bought more than other indices. It too is at an important
point, but it too is also showing promise.

SP400: Midcaps showed buying Friday as well, even more so than RUTX.
Cleared the 50 day SMA and the December high the prior Friday, then came
back to test that move and held. Still inside the selloff from January to
February, and that makes all moves inside that level suspect, particularly
one of these with the lack of an upside base or pattern. Still this is
promising and how the midcaps react this week, as with the other indices, is
quite important.

SP500: SP500 definitely looks better than it did early week as it managed
to hold the 50 day SMA with a pair of tight doji Thursday and Friday. It
broke through the 50 day two Fridays back and then this fade. It set itself
up for a possible bounce, but overall the pattern makes me a skeptic. You
can see the outline of an upward pointing wedge from the February selloff to
present, all contained inside that selloff. That is not a bullish pattern.
We will see how SP500 performs this week off the 50 day SMA test.

DJ30: DJ30's pattern is even harder to interpret. The selloff, then a slow
rise in arguably a channel and arguably a triangle. Last week it put in a
lower high and faded to the lower trendline. Still looks weak, but it has
put itself in a position where it could bounce near term.


LEADERSHIP

Chips: And still testing. Some have put themselves in position to move
higher, e.g. ON, SLAB, TXN, MU, XLNX. Others are almost there but appear to
need more work, e.g. LRCX, SWKS. As with SOX, they are getting into
position to bounce, but can they do so at these levels?

FAANG: This group poses the same question as chips, even to a higher
degree: can they move at these levels. If so, then I would say the entire
group is a buy. FB has set up something of a double bottom with handle.
AAPL is in a nice 10 day EMA test after breaking to a new high. AMZN is in
a 1-2-3-4 test of the 10 day EMA after a new high. NFLX is holding the 10
day EMA in a tight range after the breakout was tossed back Monday. GOOG is
very similar to FB with a double bottom with handle. Again, if the market
is going to move up, these patterns are ones that can make that move.

China: NTES broke higher Thursday, held it Friday. BIDU is testing the 10
day, looks good to go. BABA gapped up off the 50 day MA Thursday. YNDX is
in excellent position to break higher. ATHM is in very good position. CTRP
is showing buying and VIPS is in a good consolidation. HTHT gapped lower
Wednesday, not helping us at all, but it did hold the prior low and is
bouncing.

Drugs/Biotechs: Up and down but overall still working well. IMGN with a
new high Friday. VCEL in a great pennant. PTCT moved higher last week.
IMMU, ARRY stumbled and we exited. Big names continue to underperform the
smaller ones, e.g. AMGN, GILD.

Internet: LLNW continues the nice tight lateral move, but it is time to
make the break. AKAM started upside Thursday, waffled Friday, but still
looks as if it will give an entry.

Software: Holding up well enough, not inspiring with new entry points just
yet. VMW has set up the FB/GOOG double bottom -- of sorts -- pattern. FFIV
is still holding the 20 day MA. RHT consolidated laterally on the week as
the 10 day EMA caught up to it. CRM testing the 10 day EMA. MSFT near the
20 day EMA, still trending higher.

Retail: There are some that look as if they can make new breaks higher.
DDS, M, KSS, TJX. WSM did break higher Thursday. TGT is trying to form up
a pattern. WMT sold to the 200 day SMA and Friday bounced; will see if
anything comes of that. There are also some good moves, e.g. PII as it
broke higher Friday. Note the PII pattern: it is very similar to FB, GOOG,
CAT -- will they break higher as well from this pattern?


MARKET STATS

DJ30
Stats: +72.85 points (+0.29%) to close at 24946.51

Nasdaq
Stats: +0.25 points (0.00%) to close at 7481.99
Volume: 3.08B (+54.77%)

Up Volume: 1.88B (+1.124B)
Down Volume: 1.15B (-50M)

A/D and Hi/Lo: Advancers led 1.67 to 1
Previous Session: Decliners led 1.31 to 1

New Highs: 109 (+26)
New Lows: 41 (-9)

S&P
Stats: +4.68 points (+0.17%) to close at 2752.01
NYSE Volume: 2.5B (+207.77%)

A/D and Hi/Lo: Advancers led 2.03 to 1
Previous Session: Decliners led 1.71 to 1

New Highs: 40 (+8)
New Lows: 90 (-46)


SENTIMENT INDICATORS

VIX: 15.80; -0.79
VXN: 17.64; -0.81
VXO: 14.11; -0.62

Put/Call Ratio (CBOE): 0.96; +0.07


Bulls and Bears: The rally to new highs on NASDAQ and SOX two weeks back of
course brought the bulls back in with a solid bump of over six points.
Heck, that is a big bump. Bears were not convinced, and they actually rose
0.2 even as the market rallied.

Bulls: 54.9 versus 48.6

Bears: 15.7 versus 15.5

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: 54.9 versus 48.6
48.6 versus 48.1 versus 48.5 versus 41.9 versus 54.4 versus 66.00 versus
64.7 versus 66.7 versus 64.4 versus 61.9 versus 64.1 versus 64.2 versus 62.3
versus 61.5 versus 63.5 versus 64.4 versus 63.5 versus 62.3 versus 60.6
versus 60.4 versus 57.5 versus 54.3 versus 50.5 versus 47.1 versus 49.5
versus 49.5 versus 48.1 versus 50.5 versus 57.5 versus 60.0 versus 60.2
versus 57.8 versus 50.0 versus 52.5 versus 54.9 versus 51.5 versus 50.00
versus 55.8 versus 50.00 versus 51.9 versus 58.1 versus 58.7 versus 58.5
versus 54.7 versus 51.9 versus 56.3 versus 55.8 versus 49.5

Bears: 15.7 versus 15.5
15.5 versus 14.4 versus 14.6 versus 14.4 versus 15.5 versus 12.6 versus 12.8
versus 12.7 versus 13.5 versus 15.2 versus 15.1 versus 15.2 versus 15.1
versus 15.1 versus 15.4 versus 15.4 versus 14.4 versus 14.4 versus 15.1
versus 15.2 versus 15.1 versus 17.0 versus 17.1 versus 19.0 versus 20.2


OTHER MARKETS

Bonds: 2.844 versus 2.826%. Bonds rallied last week, clearing the 20 day
EMA Tuesday. Rallied to the 50 day EMA then lost some ground Friday. The
move leads some to speculate if bonds are about to rally. A break through
the 50 day MA's would be the most important move for that direction.

Historical: the last sub-2% rate was in November 2016 (1.867%). 2.826%
versus 2.819% versus 2.844% versus 2.866% versus 2.896% versus 2.872% versus
2.879% versus 2.863% versus 2.879% versus 2.868% versus 2.799% versus 2.875%
versus 2.893% versus 2.864% versus 2.866% versus 2.934% versus 2.952% versus
2.893% versus 2.873% versus 2.904% versus 2.913% versus 2.833% versus 2.857%
versus 2.8577% versus 2.844% versus 2.813% versus 2.805% versus 2.707%
versus 2.841% versus 2.792% versus 2.713% versus 2.72% versus 2.72% versus
2.66% versus 2.66% versus 2.639% versus 2.617% versus 2.656% versus 2.661%
versus 2.618% versus 2.587% versus 2.535% versus 2.55% versus 2.559% versus
2.551% versus 2.482%


EUR/USD: 1.2287 versus 1.2304. Euro fell to the 50 day EMA on the week,
but it continues a 2 month lateral move that is consolidating the prior
rally.

Historical: 1.2304 versus 1.23782 versus 1.2392 versus 1.23412 versus 1.2305
versus 1.2305 versus 1.24017 versus 1.2411 versus 1.2344 versus 1.23187
versus 1.22822 versus 1.21894 versus 1.21893 versus 1.23257 versus 1.2296
versus 1.2324 versus 1.22820 versus 1.23431 versus 1.2411 versus 1.25083
versus 1.2450 versus 1.23528 versus 1.22887 versus 1.22524 versus 1.2273
versus 1.2377 versus 1.24573 versus 1.2502 versus 1.2404 versus 1.2402
versus 1.23832 versus 1.24308 versus 1.24159 versus 1.24340 versus 1.23083
versus 1.22567 versus 1.22169 versus 1.2241 versus 1.2198 versus 1.22698
versus 1.22060 versus 1.20608 versus 1.19507 versus 1.19322 versus 1.19662
versus 1.20313 versus 1.20756 versus 1.20177 versus 1.20573 versus 1.2001
versus 1.1936 versus 1.1936 versus 1.18998


USD/JPY: 106.00 versus 106.344. Dollar is in a 4 week lateral range below
the 10 day EMA, trying to find some support for a break higher through the
20 day EMA that has held it in check since early January.

Historical: 106.344 versus 105.846 versus 106.42 versus 106.335 versus
106.77 versus 106.41 versus 106.105 versus 105.752 versus 106.359 versus
105.734 versus 106.03 versus 106.695 versus 107.381 versus 106.96 versus
106.886 versus 106.85 versus 107.581 versus 107.435 versus 106.294 versus
106.153 versus 106.782 versus 107.77 versus 108.669 versus 108.669 versus
108.797 versus 108.88 versus 109.33 versus 109.58 versus 108.651 versus
110.001 versus 109.46 versus 109.50 versus 108.77 versus 108.84 versus
108.601 versus 109.411 versus 109.033 versus 110.159


Oil: 62.41, +1.22. Still in the lateral move that started with the
February selling.


Gold: 1312.30, -5.5. Unable to hold near the 50 day EMA and breaking lower
again.


MONDAY

It is FOMC week and this time it is expected the Fed will hike rates 25 BP,
one of those 3 hikes for 2018. More important than the hiking is the QT,
the 'quantitative tightening' as the Fed removes the buys of the junk assets
from its balance sheet, the 'give us your poor, your wretched junk assets
yearning for a buyer of last resort' program. As with that immigration
period, there comes a time when you don't need them anymore, and just as
immigration was shut down in the 1930's until the 1960's, the asset buying
program is unneeded.

Okay, so FOMC is the big dog but there is also Existing Home Sales, Leading
Economic Indicators, Durable Goods Orders, and New Home Sales. Enough to
keep things interesting as the Fed digests the stronger than expected
Industrial production for February (1.1% vs 0.3% exp vs -0.3% January) and
Capacity Utilization (78.1% vs 77.7% exp vs 77.4% January). Michigan
sentiment was also up at 102.0 from 99.7 in February. If the FOMC raises as
expected, that should at least not rattle markets.

This is one of those situations where we see a lot of really interesting
upside patterns, but most of which are tests of upside moves. The leading
indices have recovered much or all of the February losses. They rallied to
new highs or close thereto and are now testing those moves.

The big question, the huge question, is whether they can use the
consolidations to break higher yet again, putting in new highs that can
hold. If there is a fail at this point, it is likely an epic one that leads
to a test of the February low. If not, then there will be some good buys
and moves to profit from, even if they are at higher highs and leave you
with that uncomfortable feeling that there is that low still hanging out
there.

Recall in October I wrote that we just had to get used to the idea of buying
the FAANG and letting them work for us even if not much else was working?
That paid off huge for us. This is developing into one of those situations
where we just have to accept it for what it is, and if the moves are made,
buy them. Heck, isn't that what we ALWAYS do? We can contemplate,
postulate, speculate, and other 'ates that we want, but when it comes down
to it, you look at good patterns up or down, and if they make the moves,
then you follow the moves.

Key for this area, given the Tuesday action, is how any new breaks higher,
to new highs particularly, are treated. If they get the same old smack in
the face that Tuesday saw, that shows the sellers are still ready, willing,
and able to sell at this level. Breaks higher that fail shortly thereafter
are of course not good action, and if they start popping up all over the
place, that tells you the sellers are using each move higher to unload
shares and that a downturn is coming.

Thus, Tuesday was a warning, but just a warning because the sellers left and
stocks consolidated nicely. The next breaks higher off these pullbacks,
however, will really be the moves that tell the market's near-term tale.

Have a great weekend!

End part 1 of 3
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