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10/21/2017 Investment House Daily
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Investment House Daily Subscribers:
MARKET ALERTS:
Targets hit: CELG
Entry alerts: GS
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
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The Market Video is DIVIDED into component parts: Market Overview, Economy,
Technical Summary, and the Next Session. Choose the segments you are
interested in without having to search a longer video. Click on the link to
the portion you wish to view.
TO VIEW THE MARKET OVERVIEW CLICK THE FOLLOWING LINK:
Flash: http://investmenthouse1.com/ihmedia/f/mo/mo.mp4
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The 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
- A couple of selling attempts do nothing to stymie the market advance.
- Stocks gap higher and rally through expiration.
- Midcaps surge to a new high, small caps break higher off the test.
- All dips are bought thus far, earnings not hurting the rally, status quo
is upside.
- Some leaders testing, some rallying, not many breakdowns.
- A second week lacking many great patterns for new upside entries.
- Trend is higher, aided by those believing it has to end, but still be
vigilant for leaders that break down.
The half day selloff Thursday that resulted in a rebound off a very weak
open apparently renewed the faith of the BTD followers. The faithful
bought, and Friday the move continued as stocks gapped higher and rallied
all expiration session. Of course, there were new highs on DJ30, SP500,
NASDAQ (closing), and SOX (post-2000). SP400 surged to a new high of its
own. RUTX gapped upside and is close to a new high.
Amazing continued strength as stocks rallied hard into expiration. The Dow
is suddenly at 23,300 after just hitting that level for the first time
intraday Tuesday. If this kind of insane melt up continues, 25,000 by
Christmas is doable.
Okay, if you ever wanted a contrary indicator I suppose you just got it.
Sure there were a few sellers this past week -- the market hiccupped Tuesday
and Thursday -- but in the big picture and with this market, that was
nothing. Indeed, the BTD faithful simply bought more. Have to admit, we
bought as well, but it was based on holding support, good patterns, etc.
That didn't make a big difference on the move, but it usually does in most
cases.
The point: there are very few sellers, and even when they show up they are
weak and are pushed out of the way like the weak kid in the school lunch
line.
Yes, we bought on the week though we did not buy that much Friday, just some
GS as it has a great pattern and sported a good upside break after digesting
some post-earnings price tumult. With a gap higher on expiration Friday
after a good run upside, while we would have bought more if they were in
good position, we ended up letting our positions just run.
Well, we did bank about 200% on CELG as it gapped lower Friday after we
bought it just before the Thursday close. That was not the plan, but we
gladly accepted the windfall. As for the upside positions, we had already
banked our October option gain so with the good move we simply let
everything else continue to work higher and will see if next week brings a
continued melt higher.
Can it move higher? With no sellers, talk of the Senate getting taxes done
before yearend (despite what the whiney-voiced guy on CNBC says), nothing
has changed the status quo backdrop, and the status quo is upside. Until
the sellers have a reason -- and the nerve -- to step in and not run at the
first sight of bids, there is no opposition to the upside.
THE MARKET
The upside accelerated on expiration Friday with upside gaps sending SP500,
DJ30 to impressive new highs. SP400 was most impressive as it came from a
quiet, flat consolidation to a gap breakout and new high. Again, no
sellers, all bids.
DJ30: Gapped higher Wednesday to a new high on no volume, sold off on
stronger volume Thursday but managed a recovery, then gapped and rallied to
a higher new high Friday. Now an impressive 6-week run to a series of new
highs. You can argue it is extended near term and it is, but that does not
matter when there are no sellers.
SP500: same action on SP500 with a gap after selling to test below the 10
day EMA Thursday. Gapped and rallied to close near the high and at a new
high.
SP400: Gapped out of the 2.5 week lateral consolidation at the 10 day EMA,
bolting to a new high ahead of RUTX. Nice consolidation, nice new upside
break.
RUTX: After the shakeout down to near the 20 day EMA on the Thursday low,
RUTX rebounded intraday to the 10 day EMA. Friday a gap upside off the 3
week test. No new high, but RUTX put in a great consolidation and is on the
way to a new high.
NASDAQ: after falling to test the 20 day EMA on the Thursday low and
rebounding that session to cut the losses, NASDAQ gapped to a new closing
high Friday. Obviously more sluggish than the NYSE large cap index.
SOX: from testing below the 10 day EMA Thursday to a gap upside and new
post-2000 high Friday. Closed off the high so a strong but not that strong
session.
LEADERSHIP
Financial: GS posted a nice gap move that appears to have resolved any
post-earnings questions. JPM gapped to a new recovery high Friday. BAC
gapped to another post-earnings rally high. C was up off the 50 day EMA
test, but is not convincing upside yet.
Semiconductors: Impressive market leading moves. AMAT, LRCX, ACLS, ON all
moved higher again Friday. TXN surged to a higher rally high. INTC as
well. Others remain solid, e.g. SMTC, SIMO, CAVM.
Software: GLUU had a good week, testing near support. VMW had another GREAT
week with a series of new highs. CRM surged Friday out of its 6 week base.
MSFT ditto, gapping to a new high. COUP still looks good to move higher.
China: Still hot and cold, overall holding up but not the group's best
week. BIDU holding a 10 day EMA test. BABA in a weeklong near support
test. YY started the week great but then stumbled around the rest of the
time. SOHU is testing its super move. SINA fell to the 50 day MA where it
is trying to hold. HTHT put in a great test and looked ready for greatness
Friday, and had it, but closed with a much more modest gain. BZUN trying to
put in a move off a 50 day EMA double bottom.
Biotech/Drugs: Similar to the China stocks, up and down group, though solid
overall. Large caps BIIB, AMGN testing support. CELG imploded as did DRRX
on drug test failures. IDRA, INFA are in decent shape. PTN put in a good
week. BLUE is in good position as is CRMD. CLVS is hanging on.
FAANG: NFLX and GOOG continue to look the best. AMZN, AAPL not so great,
FB is decent.
Machinery/Manufacturing: Great moves, e.g. CMI. Others holding up, e.g.
CAT, HOLI, TEX. HON gapped upside Friday. EMR still looks good.
Metals: Still interesting particularly steel, e.g. SID, AKS. SCHN, RKS
started higher Friday.
Retail: Good moves on the week with TGT, WMT starting back upside Friday.
WSM bombed on results, but as of Friday was back up to pre-earnings levels.
Others that were solid fell a bit Friday, e.g. KIRK, CONN.
MARKET STATS
DJ30
Stats: +165.59 points (+0.71%) to close at 23328.63
Nasdaq
Stats: +23.99 points (+0.36%) to close at 6629.05
Volume: 1.8B (-0.64%)
Up Volume: 1.18B (+386.114M)
Down Volume: 592.44M (-398.53M)
A/D and Hi/Lo: Advancers led 1.59 to 1
Previous Session: Decliners led 1.33 to 1
New Highs: 249 (+173)
New Lows: 38 (-8)
S&P
Stats: +13.11 points (+0.51%) to close at 2575.21
NYSE Volume: 884.1M (+25.90%)
A/D and Hi/Lo: Advancers led 1.54 to 1
Previous Session: Advancers led 1.03 to 1
New Highs: 255 (+132)
New Lows: 39 (+3)
SENTIMENT INDICATORS
VIX: 9.97; -0.08
VXN: 14.32; -0.32
VXO: 7.54; -0.30
Put/Call Ratio (CBOE): 0.81; -0.16
Bulls and Bears: Bulls held the 60 level after jumping there last week.
Bears held the 15 level after dumping there last week That second 60+
reading is another weight on the selling side of the market scales.
Bulls: 60.0 versus 60.4
Bears: 15.2 versus 15.1
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: 60.60 versus 60.4
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 versus 56.7 versus 53.4
versus 57.7 versus 63.1 versus 61.2 versus 61.8 versus 62.7 versus 61.8
versus 58.2 versus 60.6 versus 58.6 versus 60.2 versus 59.8 versus 59.8
versus 59.6 versus 58.8 versus 56.3 versus 55.6 versus 51.0 versus 42.9
versus 41.7 versus 47.1 versus 42.9 versus 46.1 versus 46.7 versus 45.2
Bears: 15.2 versus 15.1
15.1 versus 17.0 versus 17.1 versus 19.0 versus 20.2 versus 19.1 versus 19.1
versus 18.3 versus 18.1 versus 17.0 versus 16.2 versus 16.5 versus 16.7
versus 18.6 versus 18.8 versus 18.6 versus 18.3 versus 19.2 versus 18.3
versus 17.1 versus 17.3 versus 17.9 versus 17.9 versus 18.3 versus 17.5
versus 18.3 versus 18.1 versus 17.3 versus 13.75 versus 17.3 versus 16.5
versus 17.5 versus 17.6 versus 16.7 versus 17.6 versus 17.5 versus 17.3
versus 18.3 versus 18.4 versus 19.6 versus 19.6 versus 19.2 versus 19.6
versus 22.3 versus 21.6 versus 23.5 versus 25.7 versus 24.3 versus 23.1
versus 23.8 versus 23.1 versus 22.8 versus 23.1 versus 24.3
OTHER MARKETS
Bonds: 2.383% versus 2.318%. Gapped back down to the 200 day SMA where it
bottomed two weeks back.
Historical: the last sub-2% rate was in November 2016 (1.867%). 2.318%
versus 2.341% versus 2.30% versus 2.302% versus 2.275% versus 2.321% versus
2.345% versus 2.345% versus 2.361% versus 2.348% versus 2.327% versus 2.326%
versus 2.341% versus 2.339% versus 2.312% versus 2.307% versus 2.236% versus
2.222% versus 2.253% versus 2.276% versus 2.273% versus 2.246% versus 2.234%
versus 2.201% versus 2.186% versus 2.19% versus 2.167% versus 2.134% versus
2.042% versus 2.105% versus 2.072% versus 2.166% versus 2.210% versus 2.136%
versus 2.129% versus 2.175% versus 2.169% versus 2.189% versus 2.217% versus
2.183% versus 2.197% versus 2.185%
EUR/USD: 1.17798 versus 1.18476. Still bouncing along the 50 day MA in a
four week lateral move.
Historical: 1.18476 versus 1.17995 versus 1.1771 versus 1.17932 versus
1.1823 versus 1.1834 versus 1.18662 versus 1.1813 versus 1.17460 versus
1.17352 versus 1.17100 versus 1.1754 versus 1.17676 versus 1.17315 versus
1.1812 versus 1.17817 versus 1.1746 versus 1.17852 versus 1.18540 versus
1.19476 versus 1.19420 versus 1.19420 versus 1.19954 versus 1.19436 versus
1.1918 versus 1.1874 versus 1.19706 versus 1.19551 versus 1.20379 versus
1.2025 versus 1.19258 versus 1.19143 versus 1.18621 versus 1.19131 versus
1.18938 versus 1.19731 versus 1.19678 versus 1.19212 versus 1.18 versus
1.17516 versus 1.1813 versus 1.17595 versus 1.17107 versus 1.17812 versus
1.17445 versus 1.17751 versus 1.18216 versus 1.17652 versus 1.17596 versus
1.17619 versus 1.17975 versus 1.1774 versus 1.18718 versus 1.18457 versus
1.18072 versus 1.18281 versus 1.18293 versus 1.1683 versus 1.17419 versus
1.1646 versus 1.1637 versus 1.16640 versus 1.16271 versus 1.15280 versus
1.15549 versus 1.14735
USD/JPY: 113.530 versus 112.561. Dollar surged Friday, continuing the
Wednesday break higher. Cleared the Sep/Oct highs and now looking at the
July high.
Historical: 112.561 versus 113.031 versus 112.21 versus 112.20 versus
111.852 versus 112.25 versus 112.413 versus 112.41 versus 112.700 versus
112.653 versus 112.818 versus 112.79 versus 112.667 versus 112.716 versus
112.442 versus 112.86 versus 112.289 versus 111.649 versus 1.12125 versus
111.995 versus 112.454 versus 111.559 versus 111.435 versus 110.846 versus
110.01 versus 110.62 versus 110.216 versus 109.434 versus 107.847 versus
108.444 versus 109.132 versus 108.747 versus 110.254 versus 110.049 versus
110.289 versus 109.652 versus 108.04 versus 109.160 versus 109.573 versus
109.195 versus 109.648 versus 109.173 versus 109.205 versus 109.333 versus
109.842 versus 110.6621 versus 109.927 versus 109.183 versus 109.177 versus
110.03 versus 109.09 versus 110.09 versus 110.757 versus 110.689 versus
109.963 versus 110.717 versus 110.368 versus 110.28 versus 110.704 versus
111.07 versus 111.166 versus 111.897 versus 111.176
Oil: 51.84, +0.33. Rallied to the September high at the lower part of the
upper resistance, then faded to test the 20 day EMA. In position for a
higher low to try the top of the range.
Gold: 1280.50, -9.50. Struggling still below the 50 day MA.
MONDAY
Earnings and data. And more government action or inaction on tax reform.
Durable goods, New home sales, GDP, Michigan sentiment final October.
Earnings: Thus far the responses have not been huge, but they have not hurt
the market. Financial earnings were not well received but those stocks held
and are now moving higher, e.g. GS, WSM. NFLX results were not stellar, but
it is holding near support as the financials did, and NASDAQ is not too much
worse for the wear.
It was not the great initial response to earnings that rallied stocks higher
on the news, but there is a delayed effect ongoing.
What you watch for now is how earnings continue to help or at least not
detract from the break higher. Recall, at some point the market likely gets
its fill of the earnings and then it will take a pullback. That is the
typical scenario but of course this market is not typical.
The market was tested a couple of sessions last week, but not much of a
test. It surely shook off whatever negatives it faced.
Thus, we are going to approach this week the same, i.e. that the market has
its head down and is rallying as bids continue returning after even some
hiccups. You always have to watch the Monday following an up expiration --
it tends to trade lower on the Monday -- but with this market that has been
a buying opportunity. Indeed, this past week the bids were eager after the
Thursday dip to near support. Very eager.
Therefore, looking at upside plays again, but are confronted with the same
issues from the prior week: finding quality new plays is difficult after
this kind of upside. Many stocks are still extended. There are some
testing and setting up and we will look at those as vehicles to play a
further rally with new plays, but we are less than wild about the
possibilities these present. So many good stocks have rallied and are
holding their rallies, not in position to enter new plays. We will look at
some new upside while of course, letting our current upside positions
continue to work.
Have a great weekend!
SUPPORT AND RESISTANCE
NASDAQ: Closed at 6629.05
Resistance:
More new highs
Support:
The 20 day EMA at 6560
6477 is the September intraday high
6461 is the July 2017 prior all-time high
6450 is the early September high
The 50 day EMA at 6447
The 2016 trendline at 6394
6341.70 is the all-time high from early June.
6300 is the mid-June interim high
6205 is the late May all-time high
The 200 day SMA at 6109
5996 is the recent May 2017 low
5937 is the all-time high from April
5915 is the tops of the March to April 2017 range
5910 is the lower gap point from mid-April
5800 from the February consolidation lows
5661 is the late January upper gap point
5601 is the January lower gap point
S&P 500: Closed at 2575.21
Resistance:
New highs again
Support:
The 20 day EMA at 2542
2522 is the upper channel line from the March 2009 uptrend channel
The 50 day EMA at 2510
2491 is the August all-time high
2480 the late August and early August highs
2453.46 is the June prior all-time closing high
The 200 day SMA at 2411
2409 is the July 2017 closing low
2406 is the all-time high from May 2017
2401 is the March 2017 all-time high
2352 is the recent May 2017 low
2348 is the April 2017 lower gap point
2329 is the March and April twin lows
2322 is the March 2017 low
2301 is the late January 2017 high
2298 is the late January 2017 high
2282 - 2280 from January 2017
2277.53 is the December 2016 high
The November 2016 all-time high at 2213.25
2194 is the August 2016 prior all-time high
2175 is the June 2016 high
Dow: Closed at 23,328.63
Resistance:
Support:
The 10 day EMA at 23,004
22,420 is the September high
The 50 day EMA at 22,402
22,179 is the August 2017 all-time high
22,086 is the mid-August lower high
21,681is the July prior all-time high
21,638 is the July 2017 closing high
21,529 is the June 2017 high
The 200 day SMA at 21,252
21,169 is the March 2017 all-time high
20,547 is the lower gap point from late April 2017
20,412 is the March 2017 low
20,400 is the mid-April 2017 low.
20,126 is the January 2017 intraday high
20,101 is the late January closing high.
19,994 - 19,999 (early January high, upper gap point from late January
19750 is the lows of the December/January range
19,732 is the January 2017 low
18,669 is the August 2016 all-time high
18,595 is the July 2016 peak
18,351 is the prior all-time high from May 2015
End part 1 of 3
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