Monday, September 29, 2014

GDP Revised to 4.6%

MARKET SUMMARY

- Indexes bounce from the next lower support.
- Internals weaker but trying to set up an oversold bounce.
- GDP revised to 4.6%. Never have so few not worked for supposedly so much.
- Stocks oversold heading to earnings providing an opportunity and reason to recover some lost ground.

The return of the buy-side. Kind of.


Hans Solo Peter Griffin is not. Similarly, Friday did not start a new buying surge.

After a tough week through the tail kicking Thursday session, the indices held support, or at least close enough to it, and rallied back with some nice percentage gains. The fact that Thursday was so negative was a positive: the indices were overdone, the smaller cap indices sold out and holding support.

Stocks threatened to sell off big after the third revision to Q2 GDP rose to 4.6% from 4.2%, the largest increase since Q4 2011. I think that brought the total 4%+ GDP quarters in this 6 year recovery to four, maybe five. A year of GDP growth at 4% in 6 years? Oh yes; we are on an improving trajectory we are told. Just as we were in 2010, 2011, 2013. Those years were even before the force Obamacare expenditures hit companies. In this read we learned that healthcare outlays rose a whopping 17.5% thanks to the Affordable Care Act's requirements. Nothing like forced spending programs to produce 'organic' GDP growth. In any event, if there is an improving trajectory I think we need NASA's finest calibrated instrumentation to detect it. Why not? They want to repurpose NASA for other areas, right?

Ah, but the market was up. From getting hammered on the week to a blaze of 1+% gains on Friday. Well, not across the board, and really only two indices were above 1%, but it was a rebound damn it, 'proof' that the uptrend would not be denied as stocks rallied from what we called 'lick log' levels Thursday night.

SP500 16.86, 0.86%
NASDAQ 45.44, 1.02%
DJ30 167.35, 0.99%
SP400 0.72%
RUTX 0.82%
SOX 1.25%

Volume faded sharply: -14% NYSE, -15% NASDAQ

A/D: Solid 2.7:1 NYSE, 2.1:1 NASDAQ, but well off the -4+:1 on the Thursday selling.

Thursday we noted that SP400, RUTX, SOX had obviously been hammer kicked lower but all were at key levels on Thursday, holding those levels as NASDAQ and DJ30 were selling through support, 'catching down' to the small and midcaps that had already sold hard. It looked as if the smaller issue indexes were sold out and ready to bounce. Friday the futures were up, they overcame some negatively viewed data, and rallied back.

That jumped SP400 off the 200 day SMA, SOX off the 50 day EMA, and RUTX off the July/August lows. SP500 moved off the lower trendline in its channel while DJ30 found support at the 50 day SMA and jumped. They all bounced where they needed, moving up from the what we style the 'lick log,' that is, the point where the critical moves or decisions are made.


'Now let's get down to the lick log . . . ' District Attorney Trotter in 'My Cousin Vinny,' 1992.

They did it. They bounced. But volume was lower and in comparison the recent selling the bounce was so-so, particularly on RUTX. Of course many individual stocks bounced from the recent selling but many moves were very mediocre, not repairing the damage the selling wrought. This was more or less what we anticipated from a rebound attempt, i.e. lower volume, not fixing the damage patterns, internals not as strong as the selling, but some of the price moves were no doubt strong. 1% moves on NASDAQ, DJ30, and SOX are not scoff-worthy.


'Yes, but are you [scoff]-worthy?' Elaine from 'Seinfeld.'

In sum, the day turned out pretty much as expected with a bounce ahead of the weekend after some fairly ugly selling.

The question is, of course, what does Friday mean in the bigger market picture? For SP500 and DJ30 it was just a walk in the park as they held key levels (lower channel line, 50 day SMA, respectively) and bounced. NASDAQ, SP400, RUTX also held key levels and bounced, but they fell off of the trail and rolled down the hill first, particularly the small and midcaps.

That all of the indices held a support level and bounced, albeit some several rungs lower, demonstrates buyers are still respecting support, at some level. Of course just because the machines in 'The Matrix' trilogy were willing to accept existence on a very low level if required doesn't mean the buy-side of the market can do the same or that we want to ply that ground if only the slugs are leading. The market is not at that level yet by any measure, but growth, the market's most fertile areas when it performs, is under pressure.

Thus this low volume rebound Friday on the heels of the Thursday high volume and strong negative breadth selloff needs to be viewed as just a relief move. It was setting up in the growth indices midweek when they started to test and hold next support. Volatile as all get out, but testing it. We posited it could be one day, two, three or more, but unless volumes improve, the recoveries improve (again, many stocks bounced Friday but very modestly), we don't anticipate more than that.

There are some new areas looking good. Restaurants are perking up. Chips are as always mixed, but some strong performances continue. Financials are still strong. Some energy stocks are getting quite interesting with good patterns post-selling. In addition, many non-name brands or at least some forgotten or disdained names are making turns from long bases, e.g. VVTV, CRAY, SFUN. As discussed last week, perhaps they can gel and provide upside leadership. They could not do it last week and their roles may be more relegated to some nice relief bounce moves and plays. That remains to be seen as in how well they move and how the overall market responds as well.

Friday we opted to let upside positions recover. Some looked quite solid but many, indeed more, did not put in moves commensurate with the overall market rally. The lack of volume, the diminished breadth, and the lack of a lot of serious upside moves place Friday in the relief bounce category . . . unless and until is shows otherwise.


THE MARKET

DJ30: Surged off the 50 day SMA after making a lower low for September. The rebound occurred on notably less volume, so a good price move that lacked a lot of buying punch. The pattern is still less than pretty as DJ30 is back at the July and September twin peaks, resistance the Dow has yet to shake.

SP500: Ugly week through Thursday with a lower selloff low, but it held the lower trendline in the long uptrend channel from November 2012 and bounced Friday. Volume fell off markedly, falling below average for the first time in over two weeks. As with the Dow, a good price move but hardly a move backed by a lot of buyers.

NASDAQ: After breaking the 50 day EMA Thursday, NASDAQ recovered Friday, moving back through the 50 day to close. Volume faded below average, and similar to SP500, it was the first sub-average volume session in over two weeks. Not a strong rebound, lower MACD remains, and it has the look of an unfinished head and shoulders pattern.

RUTX: Gapped higher off of the late July lows after testing that level Thursday. Bounced where it had to, at the lick log. That is all.

SP400: Bounced from the 200 day SMA after a weeklong flop to that level. SP400 held the 200 day in early August and rallied five weeks off that test. Perhaps SP400 is forming a bigger triangle pattern. Long way to go to prove that, but holding at a very logical support point and starting a relief bounce.

SOX: Gapped off the Thursday 50 day EMA test. SOX continues holding that support; bounced off it in mid-September. Not a pretty pattern, but a pretty gritty group of stocks that are holding support.


LEADERSHIP

Energy: Every time oil and gas improves its patterns it suffers a blowout. Some of the service stocks, however, look solid, e.g. SLB, HAL.

Eateries: Some interesting patterns, e.g. PNRA, CHUY, BKW.

Biotech/Drugs/Medical: Still good looking patterns and moves. INSY, CELG, BIIB, VRTX, ANIP.

Chips: SWKS, RMBS remain strong. SIMO is interesting.

Retail: Broad and not bad. CVS (drug stores), LB (apparel stores), BBBY. Very interesting.

Financial: GS with an easy 20 day EMA test. JPM testing the same level.


MARKET STATISTICS

NASDAQ
Stats: +45.45 points (+1.02%) to close at 4512.19
Volume: 1.594B (-15.61%)

Up Volume: 1.29B (+1.044B)
Down Volume: 314.45M (-1.366B)

A/D and Hi/Lo: Advancers led 2.12 to 1
Previous Session: Decliners led 4.2 to 1

New Highs: 34 (+9)
New Lows: 106 (-62)

S&P
Stats: +16.86 points (+0.86%) to close at 1982.85
NYSE Volume: 630.6M (-14.4%)

A/D and Hi/Lo: Advancers led 2.74 to 1
Previous Session: Decliners led 4.84 to 1

New Highs: 16 (+6)
New Lows: 142 (-48)

DJ30
Stats: +167.35 points (+0.99%) to close at 17113.15


SENTIMENT INDICATORS

VIX: 14.85; -0.79
VXN: 16.85; -1.27
VXO: 13.62; -0.98

Put/Call Ratio (CBOE): 1.13; -0.02

Bulls and Bears:

Bulls continue their tumble, not surprising given the market losses: 48.0% versus 52.5% versus 57.6%

Bears flat-lined: 15.3% versus 15.2% versus 14.1%

Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.




Bulls: 48.0% versus 52.5%
52.5% versus 57.6% versus 56.1% versus 52.5% versus 49.5% versus 46.4% versus 50.5% versus 55.6% versus 56.5% versus 56.6% versus 60.6% versus 57.6% versus 60.2% versus 61.4% versus 62.6% versus 62.2% versus 58.3% versus 57.2% versus 55.1 versus 55.7 versus 54.7

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

Bears: 15.3% versus 15.2%
15.2% versus 14.1% versus 13.3% versus 15.1% versus 16.2% versus 16.2% versus 17.1% versus 16.2% versus 17.2% versus 15.1% versus 15.2% versus 16.1% versus 16.3% versus 17.2% versus 17.4% versus 17.3% versus 18.3% versus 19.4% versus 20.6% versus 19.7% versus 21.7% versus 20.6 versus 18.6%

Background: Over 35% is the threshold to be really be a good upside indicator. For reference, bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment. Prior levels for comparison: Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). That was a huge turn, unlike any seen in recent history.


OTHER MARKETS

Bonds: 2.53% versus 2.51% versus 2.56% versus 2.53% versus 2.56% versus 2.58% versus 2.63% versus 2.62% versus 2.59% versus 2.59% versus 2.61% versus 2.55% versus 2.54% versus 2.50% versus 2.47% versus 2.45% versus 2.45% 10 year.

Recovered last week then paused more or less Friday after retaking the 50 day EMA on the week.

Oil: 93.55, ++1.06. Bounced on the week, but just up to the 20 day EMA, the resistance that has held oil in check since July.

Gold: 1215.50, -6.20. Lateral move all week as gold tries to break higher but struggles at the 10 day EMA.

$/JPY: 109.287 versus 108.70 versus 109.12 versus 109.04 versus 108.89 versus 108.78 versus 108.982 versus 109.17 versus 108.265 versus 107.13 versus 107.19 versus 107.34 versus 107.13 versus 106.80.

Dollar resuming its upside after a 10 day EMA early in the week.

Euro/$: 1.2747 versus 1.2780 versus 1.2847 versus 1.2850 versus 1.2831 versus 1.2916 versus 1.2875 versus 1.2960 versus 1.2940 versus 1.2963 versus 1.2912.

Surging higher Wednesday to Friday to new 10+ year highs.


MONDAY

Next week sees the stock indexes trying to keep alive a bounce from support at various levels. The buyers are trying to move in, coming back after the Wednesday attempt was sold hard Thursday. That they came back at all suggests they will attempt to push it higher again.

Whether they succeed is another story and our working thesis, whether it works or not, is that the market bounces in relief but the move fails to deliver any new highs or a lasting upside move.

There will be plenty of data to ponder. Personal Income and Spending Monday, Chicago PMI Tuesday, ISM Wednesday, Factory orders Thursday, Jobs Report Friday. With a 4.6% GDP you would expect jobs in the 300K range. But those are not the expectations.

Why? Because this isn't really a 4.6% GDP economy. More and more news outlets are finally realizing and reporting the facts, e.g. 100+M working aged people not working, real wages are falling, low quality low pay jobs created, the age 24 to 54 range, the most productive and highest earning ages, are still millions of jobs light. The capper is that the US still destroying more companies than creating.

Never in the history of the US have so many not worked, lost their job, lost their business, or had to take a low paying, part-time job when there was such 'bounty.' This economy's low paying jobs, the jobs that put the people to work who serve those who benefit from the Administration's favoritism policies and the Fed's focus on increasing financial asset wealth of those at the top, are the equivalent of the 1930's soup lines. They put a bit of food in your belly but there is no hope for anything better.

Or if you prefer, let's say they are the equivalent of the busy work projects of the Great Depression. Massive amounts of dollars were conjured and spent on painting bridges and infrastructure patches, basically keeping the assets of those with the assets and the power from deteriorating. This supposedly helped because it gave people a 'job,' but it did nothing to solve the depression.

How can you have 4.6% GDP growth destroying more companies than creating? You have what we have reported all along: concentration of all growth in fewer large companies that received free money and then competitive protection from the federal government at the start of the Obama administration with the stimulus package. Then you add on the onerous burdens on smaller businesses of the ACA, the EPA, the BLM, etc. The result is a very few enjoying all the gains, similar to those who are wealthy and own financial assets receiving all the financial gain; the breakdown of the sentiment polls shows this as the wealthy are happy and confident while the other economic spectrums are not. Those states where the oil and gas industry operates are ahead of all others and help prop up the economy. Without it we would really be in bad shape, but the numbers wouldn't show it because they measure only what the federal government wants to measure. It is likely time we stop spending our money on funding what amount to worthless exercises in number fiction.

Okay, so much for the economic condition. It is great according to reports but not really great, kind of like the economic data: headlines sound great, the details are not.

With some newer areas trying to move higher and some other groups testing and setting up decent patterns, e.g. oil and gas services, the bounce strength looks better and we will still look at and pursue some upside positions that are again in good risk/reward position.

With the fall earnings season here and stocks oversold near term there is a natural opportunity for some upside as stocks recover some ground in anticipation of results. The 'warnings' season is thus far quiet with those saying anything being mostly positive in their comments/guidance. A bit more of that and the bounce can gel.

Overall any upside move is still viewed as a bounce and current upside that is struggling or lagging can be pared as the move continues. Then we see how good the move is. Of course if the Wednesday and Friday was just a head fake and the market starts the week weak, that says a lot and we will need to move into downside plays.


SUPPORT AND RESISTANCE

NASDAQ: Closed at 4512.19

Resistance:
The 10 day EMA at 4532
4610 is the September 2014 post-bear market high.

Support:
The 50 day EMA at 4495
4486 is the July 2014 high
4372 is the March 2014 high
The August low at 4321
4289 is the July 2000 recovery high
The 200 day SMA at 4282
4277 is the March lower gap point
4246.55 is the January 2014 peak
4131 is the March 2014 low
4104 is the lower gap point from 12/20/13
4070 is the series of highs from late November/early December
3991 is the prior November 2013 high and the post-bear market high.
3968 is the February 2014 low
3946 is the April 2014 intraday low


S&P 500: Closed at 1982.85

Resistance:
1991 is the July 2014 high
2011 is the all-time high
2017 is the December 2012 up trendline

Support:
The 50 day EMA at 1978
1963 is the lower trendline from 11/2012
1905 is the August 2014 low
1902 from early May was the intraday all-time high.
The 200 day SMA at 1898
1897 is the prior all-time high hit in April 2014
1883.57 is the early March high.
The December and January highs at 1848
The April 2014 low at 1814
1808 is the November and December 2013 twin peaks
1775.22 is the October prior all-time high
1768 is the December 3013 low
1738 is the February 2014 low
1730 is the September 2013 peak
1710 is the August 2013 peak.
1698 to 1700 are the July and August interim highs
1687 is the May high and post-bear market high
1685 is the mid-August 2013 upper gap point


Dow: Closed at 17,113.15

Resistance:
16,946 is the June 2014 peak
16,970 is the June 2014 former all-time high
The 50 day EMA at 16,983
17,068 is the early July 2014 peak
17,152 is the mid-July post bear market high
17,351 is the September 2014 all-time high.

Support:
16,736 is the penultimate all-time high from May 2014
16,341 is the May low
16,334 is the August 2014 low
16,632 is the April 2014 all-time high
16,589 is the December 2013 all-time high
The 200 day SMA at 16,550
16,506 is the March 2014 peak
16,334 is the August 2014 low
16,257 is the January 2014 low
16,179 is the November 2013 peak.
15,739 is the December 2013 low
15,696 is the September 2013 peak
15,659 is the August 2013 peak


ECONOMIC CALENDAR

September 26 - Friday
GDP - Third Estimate, Q2 (8:30): 4.6% actual versus 4.6% expected, 4.2% prior
GDP Deflator - Third, Q2 (8:30): 2.1% actual versus 2.1% expected, 2.1% prior
Michigan Sentiment -, September (9:55): 84.6 actual versus 85.0 expected, 84.6 prior

September 29 - Monday
Personal Income, August (8:30): 0.3% expected, 0.2% prior
Personal Spending, August (8:30): 0.4% expected, -0.1% prior
PCE Prices - Core, August (8:30): 0.0% expected, 0.1% prior
Pending Home Sales, August (10:00): -0.2% expected, 3.3% prior

September 30 - Tuesday
Case-Shiller 20-city, July (9:00): 7.4% expected, 8.1% prior
Chicago PMI, September (9:45): 61.5 expected, 64.3 prior
Consumer Confidence, September (10:00): 92.0 expected, 92.4 prior

October 1 - Wednesday
MBA Mortgage Index, 09/27 (7:00): -4.1% prior
ADP Employment Chang, September (8:15): 202K expected, 204K prior
ISM Index, September (10:00): 58.5 expected, 59.0 prior
Construction Spendin, August (10:00): 0.4% expected, 1.8% prior
Crude Inventories, 09/27 (10:30): -4.273M prior
Auto Sales, September (14:00): 6.2M prior
Truck Sales, September (14:00): 7.9M prior

October 2 - Thursday
Challenger Job Cuts, September (7:30): -20.7% prior
Initial Claims, 09/27 (8:30): 297K expected, 293K prior
Continuing Claims, 09/20 (8:30): 2458K expected, 2439K prior
Factory Orders, August (10:00): -9.3% expected, 10.5% prior
Natural Gas Inventor, 09/27 (10:30): 97 bcf prior

October 3 - Friday
Nonfarm Payrolls, September (8:30): 210K expected, 142K prior
Nonfarm Private Payr, September (8:30): 205K expected, 134K prior
Unemployment Rate, September (8:30): 6.1% expected, 6.1% prior
Hourly Earnings, September (8:30): 0.2% expected, 0.2% prior
Average Workweek, September (8:30): 34.5 expected, 34.5 prior
Trade Balance, August (8:30): -$40.9B expected, -$40.5B prior
ISM Services, September (10:00): 58.9 expected, 59.6 prior


By: Jon Johnson, Editor
Copyright 2014 | All Rights Reserved

Jon Johnson is the Editor of The Daily at InvestmentHouse.com

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Monday, September 15, 2014

Stocks Slide Back Into Holding Pattern

MARKET SUMMARY

- Stocks slide back into a holding pattern as Thursday's growth advance is flipped.
- Retail sales solid on autos, higher costs.
- China economic data shows a massive slowdown.
- Leaders still setting up but some are lagging.
- At this time of year a failure to launch when the opportunity is there can lead to trouble.

Stocks didn't roll over on Friday, but they certainly didn't help any upside cause, at least in terms of the overall action. Sure there were exceptions to the upside, but Friday, after a fairly promising Thursday as the small caps and growth posted nice gains, was definitely a step back in the attempt to break from the lateral consolidation.

Indeed, Thursday I talked a lot about the need for follow through to the nice advance the small caps and midcaps registered. Friday was not that day. RUTX gave up just about all of the Thursday bounce from the 50 day EMA and SP400 broke the 20 day EMA, the near support that was holding on the two week pullback. So, no follow through and moreover, given the good moves Thursday were tossed back, it was not just a lack of follow through but some undoing of what looked to be the start of a new advance effort.

SP500 -11.91, -0.60%
NASDAQ -24.21, -0.53%
DJ30 -61.49, -0.36%
SP400 -0.94%
RUTX -1.00%
SOX -1.27%

VOLUME: NYSE +15%, NASDAQ +4%. Rising volume just as the indices stretch to make new breaks but then are tossed back. Once again not the best price/volume action as sellers came in after a break higher just to toss RUTX, SP400 et al back down.

A/D: NYSE -3.8:1, NASDAQ -2:1. Recall how breadth lagged upside on NYSE Thursday (1.3:1) even as RUTX small caps posted nice gains. Clearly not the case Friday as breadth showed a broad blow torch application to stocks.

One step forward, one step backward. More than that, given the run to this point (moving to modestly higher highs or to resistance as the case may be) AND the time of year (September/October traditional correction period), this is more of a one step forward, one step back and stumble scenario. Add in renewed worries the Fed will have to take some form of accelerated rate hikes given retail sales and other economic data, dubious as the headlines may appear be, and you have to, as noted Thursday, remain vigilant with the upside positions. And of course the Fed meets again next week during option expiration week, so everyone will be watching what the statement says about the future plans. While Yellen no doubt will remain dovish, that won't forestall speculation as to what the statement really means and how investors, already worried about the Fed 'pulling forward' rate hikes, will interpret any statement even remotely hawkish.

In short, while leadership has performed quite nicely through at least Thursday, unless some upside follow through is generated that breaks the indices out of this lateral consolidation (some would call it malaise), the market could run out of time to put in a further move before the weight of the season along with worries about the future of easy money tries to roll stocks from these peaks.


THE MARKET

CHARTS

RUTX: From such a nice upside break Thursday to a turn right back down Friday. Back to the 50 day EMA and the coincident 38% Fibonacci retracement of the August to September move. Okay so it holds a new lateral move but a volatile one. Now once more RUTX needs to bounce. It did it Wednesday after a Tuesday dump so it will have the chance to do it again this week. Just as with the market, the Russell cannot make the break.

SP400: After the hold and bounce from the 20 day EMA the midcaps reversed and fell below the 20 day EMA. Promising move but then tossing it and more Friday. Okay, not a good move, not making the break higher. Doesn't mean it has to roll over. The 50 day EMA is still just below at 1414, another 8 points. It can test and hold and still put in a higher low at its own 38% Fibonacci retracement of the August move. It is, however, failing at the July peak and on lower MACD. Momentum is weaker. Now it has to show it can hold the 50 day.

NASDAQ: More of the same, moving laterally in a narrow range at the 10 day EMA. Back and forth, holding flat. This is not bad action at all, just would like to see the other growth indices hold their moves and then NASDAQ push them over the top. The issues are there, however. Three stronger downside sessions on higher volume in two weeks shows distribution, i.e. dumping of shares, building. NASDAQ can do it but make the break, but a lot of tech stocks that were leading the past week really struggled Friday.

SOX: Similar to RUTX the chips flushed a pretty decent Thursday move then slid lower to the 20 day EMA. No break of support and a pretty normal test, but SOX is also coming off of breaking to a higher high then coughing that up as well. As with SP400 it can hold the line for a higher low, but it is also dealing with a double top and lower MACD on that break upside. Many chips struggled on Friday as well.

DJ30: Actually not bad action, testing lower and coming close to the 50 day MA but then rebounding to hold the lows of last week. Looks as if it wants to seek that 50 day, and again, that is not bad, but you also have to factor in DJ30 is at the July high and thus far unable to push through. MACD is fine and shows some continuing momentum. The main issue: the time of year.

SP500: Was sitting at the 20 day EMA but below the upper trendline in its long channel from late 2012. Tuesday down harder, recovered to Thursday but no real upside advance, and then down harder on Friday with stronger volume. Still trying to hang on at the July peaks but struggling and looks as if a 50 day MA test down to 1970ish (closed at 1985.54) is likely before any attempts upside. Just not crisp in its upside action.


LEADERSHIP:

The problem Friday was not that there were no good moves; there were, e.g. SCTY, YNDX, GRUB, TXMD. The problem is some good looking stocks from earlier in the week turned back down rather hard similar to some of the indices, e.g. BWLD, CRM, MLNX, NFLX, SWKS, SN, UBNT.

Rapid rotation has plagued this last rally. I have discussed this before, where the market moves up but it has been slow and not nearly as crisp as the prior 7 week run. Stocks move up, then stall and backslide as money jumps from one group to another. Typically that is an indication that money is uncertain what to do. It is a positive it is still in the market, but it is flitting around like a butterfly on amphetamines. Either it catches a bid and surges or it burns itself out.

Metals, Industrial minerals: Looking interesting, e.g. PLM, CLF.

Chips: Some looking heavy, e.g. MLNX, SLAB. Solar, however, improving, e.g. CSUN, FSLR, JASO. Strange given the weakness in oil and energy companies.

Biotech: The big names are still struggling after good runs, but the smaller names are still looking solid, e.g. TXMD, EXAS, CLVS, TGTX.


MARKET STATISTICS

NASDAQ
Stats: -24.21 points (-0.53%) to close at 4567.6
Volume: 1.728B (+3.78%)

Up Volume: 702.38M (-327.62M)
Down Volume: 1.07B (+471.01M)

A/D and Hi/Lo: Decliners led 2.08 to 1
Previous Session: Advancers led 1.41 to 1

New Highs: 59 (-10)
New Lows: 43 (-11)

S&P
Stats: -11.91 points (-0.6%) to close at 1985.54
NYSE Volume: 694.4M (+14.78%)

A/D and Hi/Lo: Decliners led 3.77 to 1
Previous Session: Advancers led 1.28 to 1

New Highs: 38 (-4)
New Lows: 54 (+14)

DJ30
Stats: -61.49 points (-0.36%) to close at 16987.51


SENTIMENT INDICATORS

VIX: 13.31; +0.51
VXN: 14.67; +0.64
VXO: 11.96; +0.55

Put/Call Ratio (CBOE): 0.89; -0.12

Bulls and Bears:

Bulls still surging: 57.6% versus 56.1% versus 52.1% versus 49.5%

Bears however are rising again: 14.1% versus 13.3% versus 15.1% versus 16.2%

Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.




Note the extreme bullishness: it was this high in 2007 at the crash, in early 2005 as well.

Bulls: 57.6% versus 56.1%
56.1% versus 52.5% versus 49.5% versus 46.4% versus 50.5% versus 55.6% versus 56.5% versus 56.6% versus 60.6% versus 57.6% versus 60.2% versus 61.4% versus 62.6% versus 62.2% versus 58.3% versus 57.2% versus 55.1 versus 55.7 versus 54.7

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

Bears: 14.1% versus 13.3%
13.3% versus 15.1% versus 16.2% versus 16.2% versus 17.1% versus 16.2% versus 17.2% versus 15.1% versus 15.2% versus 16.1% versus 16.3% versus 17.2% versus 17.4% versus 17.3% versus 18.3% versus 19.4% versus 20.6% versus 19.7% versus 21.7% versus 20.6 versus 18.6%

Background: Over 35% is the threshold to be really be a good upside indicator. For reference, bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment. Prior levels for comparison: Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). That was a huge turn, unlike any seen in recent history.


OTHER MARKETS

Bonds: 2.61% versus 2.55% versus 2.54% versus 2.50% versus 2.47% versus 2.45% versus 2.45% 10 year.

Hard week for bonds, particularly back end loaded. Sold to the 50 day EMA midweek then broke down Thursday, gapping sharply lower Friday.

Oil: 92.27, -0.56. Still trending lower below the 10 day EMA but also at an old support level and trying to form up a bounce.

Gold: 1231.50, -9.60. Gold finding no haven status despite the world issues. With the Fed perceived as having to get tighter, gold is not wanted.

$/JPY: 107.34 versus 107.13 versus 106.80. Huge week for the dollar though it paused Friday. Massive upside breakout and after a test, buy more dollars versus yen.

Euro/$: 1.2963 VERSUS 1.2912. Taking a breather Tuesday through Friday after a big surge.


THE ECONOMY

Retail Sales, August rose but the July revision is the 'whew' event.

0.6% gain in retail sales was in line with expectations. That July was revised from 0.0% to 0.3% was the thing that made the television economists slobber and traders fret.

The television economists first. They see this as proof the economy continues to improve. It is good news if that is the case, and no doubt the figures are better than they were 2013, much steadier (thanks to the July revision) versus the hit or miss, up one week down the next 2013 series.

That said, it is all still about autos. Auto sales rose 1.5% to an 8 year high. Take out autos and Retail Sales rose 0.3%, half the headline and the lowest rate since January.

Core retail sales (ex-food, auto, building materials) rose 0.4% versus 0.5% expected. Yes you need to take out some of these costs to get a better feel for reality. Remember, retail sales are based on total dollars, not units. Thus higher prices mean bigger retail sales figures even if less goods are purchased.

So, take out autos; the sub-prime market is alive and well there so the figures are rather meaningless. Food as well. Food prices are rocketing higher with milk, butter, beef at highs. Pork prices are fading after the spike on the pig diarrhea, but other prices continue to climb as 80% of California is now in drought. With so much produce coming from California, the drought is driving everything in your salad higher, fruit or vegetable.


China having its own very serious economic issues.

Ghost cities are still ghost cities. But after the latest round of economic data dump Chinese style, there may be a few more cropping up from cities that once had real people living in them.


World's largest shopping mall bustles . . . Same kids still in downtown Zhengzhou


Parks, copies of Paris, Manhattan empty. Bustling Zhengzhou remains empty.

The data released are so far below expectations that concerns about Chinese GDP slowing to the 7% range are misplaced. After these numbers GDP appears to be trending below 7%, the slowest since the pre-crash LEH implosion.

Industrial Production 6.9% versus 8.8% expected. Slowest since early 2009.

Fixed investment 16.5% the lowest since 2001.

Housing: Sales -13.4% August, -17.9% July.

Electrical output: Declined year/year, the first since 2007.

Bloomberg and JPM say this data shows Chinese GDP at 6.3%. That is almost cataclysmically low for China. Add on top of that Europe heading toward recession again. Thank goodness the oil and gas industry is so strong and the QE, stimulus, and regulations that were enacted during the financial crisis have kept the favored companies making lots of money. Otherwise US GDP would be scraping by a 0.5% if we were lucky. Oh, is the Fed to be credited? I suppose; but for the liquidity financial assets would be much lower in value and what little wealth effect would be nowhere. Of course the Fed cannot change the economy for the good; it can only try to keep it afloat while the federal government and those that elected it put forth policies. Unfortunately those policies are not producing a real recovery for most of the country.


MONDAY and the WEEK

The action to end last week was disappointing on the heels of solid moves Thursday and generally good action in leaders all week long. As noted earlier, the rapid rotation starts moves but then leaves them hanging or in some cases the advances are turned back.

At the same time the indices are hanging in, working along some support or at some resistance. Holding gains is always good. But, with the up and down bumps as money moves quickly through the market can erode the consolidation; quiet ones are typically better as money slowly moves in, sets up, then demand outstrips supply and the break higher occurs. With this kind of action you have to be wary of the foundation weakening, not strengthening.

Throw in the time of year, this failure to launch gets worrisome after a few attempts. We were looking for another advance before perhaps a September/October seasonal dip, but if stocks cannot find the bounce this last bounce to this point may be all it can deliver before a dip that then leads to another seasonal move, the year end run.

Thing is, there are still a LOT of good looking stocks in the market. Good tests of breaks higher, good patterns; there are many that look worthy of money if the moves show up. At this juncture, THAT is the key: if the moves show up. Pullbacks that look great can just keep pulling back further and further. Patterns that are setting up or are set up can just fall apart. As we say, they are just pretty pictures until they make the moves.

As noted a few weeks back, the risk/reward at this level is more problematic with the move higher up to new highs in some cases, resistance in others. Add on that the worries of the FOMC meeting this week and any indications of additional hawkishness or even the perception of more hawkishness. Then you have the billionaires worried even as individual investor bullishness spiked two weeks back. It is mitigating some but still at high levels.

Don't want to sound as if we are scared of our own shadows, but given the risk/reward alone it pays to be cautious. So we have existing upside positions and will look at some more given the nice setups that still exist. At the same time if the indices cannot make the breaks higher we need to be ready to take positions off the table as we have done of late using trailing stops as well as prep for some downside with new plays. With the time of year, etc. best to work with good positions we have, be ready if the upside makes its break, but also if the market doesn't have anything left to continue this move.



SUPPORT AND RESISTANCE

NASDAQ: Closed at 4567.60

Resistance:
4657 is the lower November 2012 trendline

Support:
The 20 day EMA at 4546
4486 is the July 2014 high
The 50 day EMA at 4476
4372 is the March 2014 high
The August low at 4321
4289 is the July 2000 recovery high
4277 is the March lower gap point
The 200 day SMA at 4257
4246.55 is the January 2014 peak. Key level.
4131 is the March 2014 low
4104 is the lower gap point from 12/20/13
4070 is the series of highs from late November/early December
3991 is the prior November 2013 high and the post-bear market high.
3968 is the February 2014 low
3946 is the April 2014 intraday low


S&P 500: Closed at 1985.54

Resistance:
The 20 day EMA at 1989
1991 is the July 2014 high
2003 is the December 2012 up trendline
2011 is the all-time high

Support:
The 50 day EMA at 1971
1949 is the lower trendline from 11/2012
1905 is the August 2014 low
1902 from early May was the intraday all-time high.
1897 is the prior all-time high hit in April 2014
The 200 day SMA at 1888
1883.57 is the early March high.
The December and January highs at 1848
The April 2014 low at 1814
1808 is the November and December 2013 twin peaks
1775.22 is the October prior all-time high
1768 is the December 3013 low
1738 is the February 2014 low
1730 is the September 2013 peak
1710 is the August 2013 peak.
1698 to 1700 are the July and August interim highs
1687 is the May high and post-bear market high
1685 is the mid-August 2013 upper gap point


Dow: Closed at 16,987.51

Resistance:
The 20 day EMA at 17,000
17,152 is the mid-July post bear market high
17,068 is the early July 2014 peak

Support:
16,970 is the June 2014 former all-time high
16,946 is the June 2014 peak
The 50 day EMA at 16,909
16,736 is the penultimate all-time high from May 2014
16,341 is the May low
16,334 is the August 2014 low
16,632 is the April 2014 all-time high
16,589 is the December 2013 all-time high
16,506 is the March 2014 peak
The 200 day SMA at 16,493
16,334 is the August 2014 low
16,257 is the January 2014 low
16,179 is the November 2013 peak.
15,739 is the December 2013 low
15,696 is the September 2013 peak
15,659 is the August 2013 peak


ECONOMIC CALENDAR

September 12 - Friday
Retail Sales, August (8:30): 0.6% actual versus 0.6% expected, 0.3% prior (revised from 0.0%)
Retail Sales ex-auto, August (8:30): 0.3% actual versus 0.3% expected, 0.3% prior (revised from 0.1%)
Export Prices ex-ag., August (8:30): -0.3% actual versus 0.3% prior
Import Prices ex-oil, August (8:30): 0.1% actual versus 0.0% prior
Mich Sentiment, September (9:55): 84.6 actual versus 83.5 expected, 82.5 prior
Business Inventories, July (10:00): 0.4% actual versus 0.4% expected, 0.4% prior

September 15 - Monday
Empire Manufacturing, September (8:30): 16.0 expected, 14.7 prior
Empire Manufacturing, October (8:30)
Industrial Productio, August (9:15): 0.3% expected, 0.4% prior
Capacity Utilization, August (9:15): 79.3% expected, 79.2% prior

September 16 - Tuesday
PPI, August (8:30): 0.0% expected, 0.1% prior
Core PPI, August (8:30): 0.1% expected, 0.2% prior
Net Long-Term TIC Fl, July (16:00): -$18.7B prior

September 17 - Wednesday
MBA Mortgage Index, 09/13 (7:00): -7.2% prior
CPI, August (8:30): 0.0% expected, 0.1% prior
Core CPI, August (8:30): 0.2% expected, 0.1% prior
Current Account Bala, Q2 (8:30): -$114.5B expected, -$111.2B prior
NAHB Housing Market , September (10:00): 56 expected, 55 prior
Crude Inventories, 09/13 (10:30): -0.972M prior
FOMC Rate Decision, September (14:00): 0.25% expected, 0.25% prior

September 18 - Thursday
Initial Claims, 09/13 (8:30): 305K expected, 315K prior
Continuing Claims, 09/06 (8:30): 2945K expected, 2487K prior
Housing Starts, August (8:30): 1045K expected, 1093K prior
Building Permits, August (8:30): 1054K expected, 1052K prior
Philadelphia Fed, September (10:00): 23.5 expected, 28.0 prior
Natural Gas Inventor, 09/13 (10:30): 92 bcf prior

September 19 - Friday
Leading Indicators, August (10:00): 0.4% expected, 0.9% prior

By: Jon Johnson, Editor
Copyright 2014 | All Rights Reserved

Jon Johnson is the Editor of The Daily at InvestmentHouse.com

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Sunday, September 07, 2014

Stocks Take to New Highs Despite Jobs

MARKET SUMMARY

- Good news, no good move: Stocks jump to open a second session, again fail to hold the move.
- ECB cuts rates, announces the pursuit of QE.
- ADP jobs fall short ahead of jobs report.
- ISM services jumps, again thanks to adjustments.
- Productivity falls but even as it does, wages fall. Something is just not right.
- Stocks fail to hold gains again, less than great action, but the indices continue to hold up.

QE goes continental. Stocks surge again, fail to hold the move again.

It is all the rage. Going QE. Look how it saved the US. From perhaps economic collapse. Surely from a strong recovery where everyone shares in the gains versus those at the top of the socioeconomic ladder. Europe doesn't have that worry: it already has a sharply bifurcated socioeconomic society. It will just make the rich relatively richer.

That was just what the western markets wanted, the EU emulating the US Fed. I used to sarcastically comment 'how European' US economic policies were. We are now so far toward the European side we have lapped the EU.

Futures, of course, surged on the news. They held the gains into the open and rallied into midmorning. ISM Services smoked expectations at 59.6, the highest since August 2005. Employment jumped to 57.1, the best since February 2006. Impressive beats.

Impressive, in an adjusted sort of way. Yes, once again a sentiment survey where respondents gave their purportedly honest answers to the questions, did not show gains, but instead, declines.

Those responding they expected 'higher employment' FELL to 22 from 26 in July and 29 in June. That is not an uptrend as the adjust numbers indicate.

New Orders were lower (63.8 VERSUS 64.9) but still at an elevated level. UNLESS, you look at the unadjusted, unaltered responses of the businesses polled. Those seeing 'higher orders' fell to 29 from 32 in July, 31 in June, and 36 in May. Again, this is a near term downtrend, not the uptrend the adjusted figures herald.

I still do not see, how, in the name of 'smoothing' to show a more 'accurate' picture of business views of the future that the actual responses of those polled are adjusted to what the pollster thinks the answers should have been.

Interestingly, US stocks peaked shortly after that news hit. They spent the rest of the session, outside of the last 45 minutes, selling. A late bounce kept SOX positive, but all indices sported another session of high to low action, squandering an upside open.

SP500 -3.07, -0.15%
NASDAQ -10.28, -0.22%
DJ30 -8.70, -0.05%
SP400 -0.33%
RUTX -0.43%
SOX 0.25%

VOLUME: NYSE +1.5%, NASDAQ -4.5%. No heavy dumping though still elevated volume all around on this return to work after the summer.

A/D: NYSE -2:1, NASDAQ -3:2.

It wasn't the Black Death or anything like that. Indeed, the indices mostly held up just fine as DJ30, SP500 still hold near support, SP400 is at the 10 day EMA, and SOX was positive and at the top of the July range even if it did fade off the high. All the same action they have shown the past week, all working on a lateral consolidation more or less, all with something to prove but also not selling off.

NASDAQ and RUTX, the Wednesday laggards, lagged again, but even with another day of fairly impressive high to low intraday slumps, both of these indices are still at the 10 day EMA. Not what you would call a nasty reversal.


LEADERSHIP

Big Names: As noted, GOOG jumped but faded. AAPL sold again. NFLX broke the 10 day EMA. PCLN fell to the 200 day SMA, completing its destiny. Not an impressive lot.

Financial: Still relatively solid with JPM holding the line over the 10 day EMA, C continuing the upside move. BAC is setting up nicely with a lateral move over the 10 day EMA.

Biotechs/drugs: Struggling again. CELG fell to the 10 day EMA on rising trade. BIIB crashed through the 20 day EMA; not a good move.

Internet-based: TRLA continued lower. VIPS tested the 50 day MA; not bad. YY jumped upside. A few good, most still struggling.

Chips: Some nice moves, e.g. NVDA, BRCM, CAMT. Some decent setups e.g. ATML. Solar not bad, e.g. JASO, FSLR.

There are still leaders, but as with the indices many are finding traction difficult. Perhaps this is just a hitch in otherwise solid moves. We will see, but with this action we have to keep watch on current positions so they don't turn on us.

MARKET STATISTICS

NASDAQ
Stats: -10.28 points (-0.22%) to close at 4562.29
Volume: 1.679B (-8.69%)

Up Volume: 751.88M (-7.42M)
Down Volume: 952.67M (-127.33M)

A/D and Hi/Lo: Decliners led 1.49 to 1
Previous Session: Decliners led 1.76 to 1

New Highs: 103 (-28)
New Lows: 47 (+10)

S&P
Stats: -3.07 points (-0.15%) to close at 1997.65
NYSE Volume: 627.3M (+1.55%)

Up Volume: 1.18B (-170M)
Down Volume: 1.85B (+430M)

A/D and Hi/Lo: Decliners led 1.99 to 1
Previous Session: Decliners led 1.15 to 1

New Highs: 154 (-32)
New Lows: 28 (+12)

DJ30
Stats: -8.7 points (-0.05%) to close at 17069.58


SENTIMENT INDICATORS

VIX: 12.64; +0.28
VXN: 13.78; +0.22
VXO: 11.67; +0.52

Put/Call Ratio (CBOE): 0.97; -0.03


Bulls and Bears:

Bulls bounce sharply: 52.1% versus 49.5%

Bears flop below the 16 to 17 range that held: 15.1% versus 16.2%

Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.




Note the extreme bullishness: it was this high in 2007 at the crash, in early 2005 as well.

Bulls: 52.5% versus 49.5%
49.5% versus 46.4% versus 50.5% versus 55.6% versus 56.5% versus 56.6% versus 60.6% versus 57.6% versus 60.2% versus 61.4% versus 62.6% versus 62.2% versus 58.3% versus 57.2% versus 55.1 versus 55.7 versus 54.7 versus 51.6 versus 50.5 versus 54.6% versus 50.5 versus 54.7% 52.0% 54.6% 53.5% 46.5% 41.8% 45.9% 53.1% 57.6 56.1 60.6% 61.6% 60.0% 58.2% 57.1% 55.7% 53.6% 52.6% 55.2% 52.6 49.5 42.3% 45.4 46.4% 44.3% 42.3% 37.1% 37.1% 38.1% 43.3%.

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

Bears: 15.1% versus 16.2%
16.2% versus 16.2% versus 17.1% versus 16.2% versus 17.2% versus 15.1% versus 15.2% versus 16.1% versus 16.3% versus 17.2% versus 17.4% versus 17.3% versus 18.3% versus 19.4% versus 20.6% versus 19.7% versus 21.7% versus 20.6 versus 18.6% 18.6% 17.5% 17.4% 15.1% 17.2% 17.2% 17.4% 17.4% 15.3% 15.1 15.3% 15.2% 15.2% 14.0 14.3 14.3% 14.4 15.5 15.5% 15.6% 16.5% 18.5 21.6% 20.6% 18.6% 20.6% 21.6% 22.7% 23.7% 23.8% 21.6%.

Background: Over 35% is the threshold to be really be a good upside indicator. For reference, bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment. Prior levels for comparison: Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). That was a huge turn, unlike any seen in recent history.


THE NEWS

Wages continue their decline and it is heralded as a great thing.

This is no plug for the minimum wage. Getting that out up front. This comment is about how policies are impacting wages. A recovery that is not really a recovery, or is but is so skewed in favor of a small group that most not only don't feel it, they are losing ground.

Q2 productivity first revision was released Thursday. It was lower at 2.3% from 2.5%. Less productive. Increasing productivity was blamed for fewer jobs and lower pay in jobs. Okay, so wages should have risen in Q2 if productivity is lower, right? Not.

Unit labor costs were negative (-0.1% versus +0.6% in the first read). That is the fourth negative quarter in 6 the last quarters. Okay lower costs, good for companies as profits improve with lower labor costs. How great for the economy!

What pushed labor costs lower: hourly compensation fell to 2.3 from 3.1. Productivity lower, hourly wages lower. That goes against even the President's somewhat narrow vision of what drives hiring and wages.

So, wages continue to decline and real wages inflation-adjusted are negative. 6 years of giving away money, giving big business all the breaks, transferring massive amounts of wealth via taxes and regulation (e.g. the ACA), and we get wages continuing to fall. The economy will not last with these trends no matter what the 'seasonally adjusted' (read 'doctored') headlines say.

The irony is, all of this Administration's stimulus has been geared, we are told, to increase demand from the middle and lower classes. It is actually eroding, indeed decimating, the very class the administration says it so wants to uplift. Why not just write some executive orders requiring hiring the middle class at higher wages? If all it takes is spending more, whether by printing or taxing those who its policies have so enriched), why not do it? Wouldn't be surprised . . .


FRIDAY

Ahead of the Friday jobs report we didn't do much other than position maintenance. GOOG tried to put in a good move, and though it closed with a gain, it gave up a lot of the move; after four days upside we passed on entering new positions.

This is, after all, still not a great risk/reward level. There is still leadership setting up good patterns to move higher, the indices are not giving in, instead attempting lateral or similar consolidations, but the last run has been less than solid for the market as the rotation from one area to another is rapid and disjointed, and all but NASDAQ and SP500 have still not shown they can take out next resistance. Sitting on top of a 4 week move and bumping resistance is not the prime risk/reward entry point, and in viewing the market, we have to keep that in mind. There are upside plays for sure, but there are also more than a few downside setups given the rally to resistance.

After the jobs report perhaps the market shows its hand as to direction. Giving up two early upside moves engendered by good news is not a good indication. No breakdown as noted, but where the indices are now there is clearly more downside risk. Doesn't mean they sell, but it is simply something to factor in when determining what you want to buy and how much you choose to place at risk. We have upside plays and downside plays ready to go, and we will see if the jobs report tips the balance one way or another.

Have a great evening!


SUPPORT AND RESISTANCE

NASDAQ: Closed at 4572.57

Resistance:
4633 is the lower November 2012 trendline

Support:
The 10 day EMA at 4555
The 20 day EMA at 4519
4486 is the July 2014 high
The 50 day EMA at 4448
4372 is the March 2014 high
The August low at 4321
4289 is the July 2000 recovery high
4277 is the March lower gap point
4246.55 is the January 2014 peak. Key level.
The 200 day SMA at 4238
4131 is the March 2014 low
4104 is the lower gap point from 12/20/13
4070 is the series of highs from late November/early December
3991 is the prior November 2013 high and the post-bear market high.
3968 is the February 2014 low
3946 is the April 2014 intraday low


S&P 500: Closed at 1997.65

Resistance:

Support:
1991 is the July 2014 high
The 10 day EMA at 1994
1994 is the December 2012 up trendline
The 50 day EMA at 1965
1939 is the lower trendline from 11/2012
1905 is the August 2014 low
1902 from early May was the intraday all-time high.
1897 is the prior all-time high hit in April 2014
1883.57 is the early March high.
The 200 day SMA at 1882
The December and January highs at 1848
The April 2014 low at 1814
1808 is the November and December 2013 twin peaks
1775.22 is the October prior all-time high
1768 is the December 3013 low
1738 is the February 2014 low
1730 is the September 2013 peak
1710 is the August 2013 peak.
1698 to 1700 are the July and August interim highs
1687 is the May high and post-bear market high
1685 is the mid-August 2013 upper gap point


Dow: Closed at 17,069.58

Resistance:
17,152 is the mid-July post bear market high

Support:
17,068 is the early July 2014 peak
16,970 is the June 2014 former all-time high
16,946 is the June 2014 peak
The 10 day EMA at 17,035
The 50 day EMA at 16,869
16,736 is the penultimate all-time high from May 2014
16,341 is the May low
16,334 is the August 2014 low
16,632 is the April 2014 all-time high
16,589 is the December 2013 all-time high
16,506 is the March 2014 peak
The 200 day SMA at 16,462
16,257 is the January 2014 low
16,179 is the November 2013 peak.
15,739 is the December 2013 low
15,696 is the September 2013 peak
15,659 is the August 2013 peak


ECONOMIC CALENDAR

September 2 - Tuesday
ISM Index, August (10:00): 59.0 actual versus 57.0 expected, 57.1 prior
Construction Spending, July (10:00): 1.8% actual versus 1.0% expected, -0.9% prior (revised from -1.8%)

September 3 - Wednesday
MBA Mortgage Index, 08/30 (7:00): 0.2% actual versus 2.8% prior
Factory Orders, July (10:00): 10.5% actual versus 11.0% expected, 1.5% prior (revised from 1.1%)
Auto Sales, August (14:00): 5.8M prior
Truck Sales, August (14:00): 7.4M prior

September 4 - Thursday
Challenger Job Cuts, August (7:30): -20.7% actual versus 24.4% prior
ADP Employment Chang, August (8:15): 204K actual versus 220K expected, 212K prior (revised from 218K)
Initial Claims, 08/30 (8:30): 302K actual versus 300K expected, 298K prior
Continuing Claims, 08/23 (8:30): 2464K actual versus 2525K expected, 2528K prior (revised from 2527K)
Trade Balance, July (8:30): -$40.5B actual versus -$42.0B expected, -$40.8B prior (revised from -$41.5B)
Productivity-Rev., Q2 (8:30): 2.3% actual versus 2.6% expected, 2.5% prior
Unit Labor Costs, Q2 (8:30): -0.1% actual versus 0.5% expected, 0.6% prior
ISM Services, August (10:00): 59.6 actual versus 57.8 expected, 58.7 prior
Natural Gas Inventor, 08/30 (10:30): 79 bcf actual versus 75 bcf prior
Crude Inventories, 08/30 (11:00): -0.905M actual versus -2.070M prior

September 5 - Friday
Nonfarm Payrolls, August (8:30): 220K expected, 209K prior
Nonfarm Private Payr, August (8:30): 200K expected, 198K prior
Unemployment Rate, August (8:30): 6.1% expected, 6.2% prior
Hourly Earnings, August (8:30): 0.2% expected, 0.0% prior
Average Workweek, August (8:30): 34.5 expected, 34.5 prior


By: Jon Johnson, Editor
Copyright 2014 | All Rights Reserved

Jon Johnson is the Editor of The Daily at InvestmentHouse.com

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