* * * *
10/31/2018 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:
https://www.investmenthouse.com/alertdaily.html
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TO VIEW THE TECHNICAL SUMMARY VIDEO CLICK THE FOLLOWING LINK:
https://investmenthouse1.com/ihmedia/f/ts/ts.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
- Upside continues with NASDAQ leading the way, large cap NYSE following, smaller caps lag quite a bit.
- Good volume, breadth shows just a large cap move.
- Big techs show gaps that surge then fade off the high.
- Second day of rally and some pundits are saying the bottom is in. Changing mid-stream just as the Fed, eh?
- Bounce continues. Great. Still needs a follow through.
The rebound continued for a second session. 'Growth' was given the nod for the leadership role by the financial stations, but growth with limits. NASDAQ rose 2.01% and NASDAQ 100 2.31%, but RUTX and SP400 lagged and lagged significantly at 0.32% and 0.31%, respectively. SOX was up less than NASDAQ. Moreover, the indices all finished fairly significantly off the highs. Up, but not a banner move. A very bounce-type rally.
The 'growth' areas -- meaning NASDAQ -- did perform better while the recent leaders in retail, food, drugs took a day off. NFLX, NVDA, AMZN, GOOG, AAPL, FB, MSFT, INTC all gapped upside but as with the indices, they gave back varying portions of the move. All positive, just some more positive than others.
SP500 29.11, 1.09%
NASDAQ 144.25, 2.01%
DJ30 241.12, 0.97%
SP400 0.31%
RUTX 0.32%
SOX 1.24%
NASDAQ 100 2.31%
VOLUME: NYSE +10%, NASDAQ +11%. Very solid upside trade with NYSE the strongest of the recent period, NASDAQ hanging in near the top of its peaks. Some good trade upside is of course a good thing.
ADVANCE/DECLINE: NYSE 1.5:1, NASDAQ 1.6:1. Okay, clearly a large cap move.
And the reason for the rally is . . .
Sure there were positives. But as noted in recent reports, the stories are the stories, and the market technical setups are what is controlling the action.
China: Reported lower than expected manufacturing growth, but the government assures us all that more stimulus would be forthcoming. Markets love stimulus, particularly Chinese stimulus as China builds its debt and credit icebergs even bigger.
Kudlow then chimed in that additional Chinese tariffs were not set in stone. Of course not; no one has chiseled them yet, but . . . the likelihood of China capitulating on the Administration's requirements even to meet and talk are somewhat remote.
Yellen: She speaks. And it is drivel. Yellen feels two more rate hikes appropriate, but fears the debt (NOW she fears debt? After the HUGE increase during her reign and she said nothing? Does this not seem strange, almost political? The debt more than doubled during the prior administration, adding more to the debt that all prior administrations combined, but that was nothing for Janet to worry about? Damnit, Janet!
Her solution? Janet says if she had a magic wand she would raise taxes. Seriously, a magic wand and you do what they do all the time? If we are talking magic, why not eliminate waste, duplication, fraud, and slashing government spending? Have the working aged people working and productive versus 95+M working aged not working and living off entitlements? Are we not all better off if we are all productive and prosperous? Is it not better for everyone to make a great wage or salary? Less government, motivated workers who do the will of the electorate versus pursue their own agendas? Raise taxes? That is the best you have Janet? Yellen is an idiot as she proved in trying to get Greenspan to 'pick a number' in terms of what is acceptable inflation. The Fed members have untold hundreds of thousands of dollars of education between them, perhaps millions. Yet they absolutely have no clue how real world, real life economics works. And we entrust these clowns with our wealth? Seriously?
Wages and salaries +3.1%, also the highest in 10 years. 2008. Hmm. The end of the prior expansion, then the drought through 2016. Policies changed, regulations slashed, taxes reformed, growth resumes. Amazing how this is shown time and time again, but no one learns.
THE MARKET
CHARTS
Gaps upside then various success holding them. At this juncture there is no follow through yet. Too early. That would come Friday at the earliest.
NASDAQ: Strong gap upside, rallied through the 10 day EMA, backing off some to close. Something of a doji finish to the day. Volume jumped, breadth not commensurate with the price move. Basically a solid large cap move as a lot of the thrashed and trashed big name techs were bought. Thus far a lot of gaps, but gaps to doji in many cases, not altering their patterns, just oversold bounces from really oversold stocks.
SP500: Gapped to the 10 day EMA, surged through it, faded to close right at the 10 day with a tombstone doji. Strong volume. Thus far, a relief bounce.
DJ30: Gapped upside for a second day of rallying, moved through the 200 day SMA to the 20 day, then faded to close just below the 200 day. Strong volume. The tech aspects definitely helped as the more staid, stoic stocks faded a bit after good moves.
RUTX: Underwhelming in its action, gapping, rallying through the 10 day EMA, selling off to close below that level with a tombstone doji. Less than inspiring.
SP400: Gapped upside to just below the 10 day EMA, moved through it, reversed to close at the session low though posting a gain.
SOX: Gapped over the 10 day EMA to a doji. Okay, a second day of upside off the lateral consolidation. Not bad, not great. Very much a relief move.
NASDAQ 100: Gapped to just below the 10 day EMA, rallied through it near the 200 day, faded to close just over the 10 day. Excellent volume. The biggest of the NASDAQ big names moved higher, but the pattern is still less than great. An ABCD bounce? Could be.
LEADERSHIP
Recent leaders took a day off as the thrashed big techs posted the better moves.
Retail: WMT backed off a bit. ROST, FOSL as well. ULTA made a nice recovery. Good group, took a day.
Food: Also many took a breather. KO continued upside, but MCD; HSY, MKC faded recent moves just a bit.
Telecom: VZ sold back some from a strong move but S gapped upside off the 200 day SMA. AUDC started upside off a quick breakout test; were hoping for a bit more testing. TMUS up solidly on earnings.
Drugs: JNJ faded modestly. PFE still solid. MRK gapped modestly to a doji. AMGN was up on some volume on earnings, but just not that strong of a pattern.
Software: DATA continued a strong move, gapping and rallying. VRSN made a second move up off the 200 day SMA sporting good volume. TTWO gapped and rallied to the 50 day SMA. Decent recovery, but it is just a recovery thus far.
SCAANN: SQ gapped upside off the 200 day SMA. Not bad, but sketchy at this point. CRM gapped over the 200 day SMA on lower volume; just a bounce. AAPL gapped up to the test the 50 day SMA. AMZN gapped upside on still above average, but a lot lower. NFLX and NVDA both gapped upside, but to doji below the 10 day EMA.
FB gapped on its earnings, but did not change its condition. GOOG gapped and tapped at the 20 day EMA then faded some. Lower trade.
MARKET STATS
DJ30
Stats: +241.12 points (+0.97%) to close at 25115.76
Nasdaq
Stats: +144.25 points (+2.01%) to close at 7305.90
Volume: 2.91B (+10.89%)
Up Volume: 2B (+90M)
Down Volume: 882.61M (+137.42M)
A/D and Hi/Lo: Advancers led 1.59 to 1
Previous Session: Advancers led 2.09 to 1
New Highs: 45 (+26)
New Lows: 136 (-89)
S&P
Stats: +29.11 points (+1.09%) to close at 2711.74
NYSE Volume: 1.283B (+9.74%)
Up Volume: 783.701M (-130.914M)
Down Volume: 491.633M (+241.388M)
A/D and Hi/Lo: Advancers led 1.5 to 1
Previous Session: Advancers led 2.33 to 1
New Highs: 25 (-3)
New Lows: 142 (-194)
SENTIMENT
VIX: 21.23; -2.12
VXN: 29.12; -1.61
VXO: 23.57; -1.90
Put/Call Ratio (CBOE): 1.12; -0.06. Twelve sessions upside in a row. 15 of 16.
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for them. Stubbornly low are those bears. It is best to see the bulls and bears converge, the former down, the latter up. They are, but in very slight moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1 versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9 versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5 versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6 versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1 versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5 versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7 versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8 versus 19.6 versus 19.8 versus 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: 3.149% versus 3.119%
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.119% versus 3.089% versus 3.079% versus 3.126% versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779% versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus 3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061% versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus 3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99% versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.13394 versus 1.13455. Euro faded a bit more but showed a doji.
Historical: 1.13455 versus 1.13760 versus 1.14042 versus 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus 1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus 1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus 1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus 1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus 1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus 1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus 1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus 1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus 1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 112.877 versus 113.074. Dollar faded.
Historical: Last below 109 in June 2018: 112.876 versus 112.58 versus 111.89 versus 112.391 versus 112.091 versus 112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus 112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus 113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus 113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus 112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus 112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus 111.064 versus 110.680
Oil: 65.31, -0.87. Oil fell to a lower low on this selloff.
Gold: 1215.00, -10.30. Impressive dip to the 50 day SMA.
THURSDAY
Two days upside in the relief move and you are surely hearing the calls of this is a bottom, this is a real rally, this is the time to buy. Perhaps they are correct, but factor this in: the Fed was so logical and deliberate when it started its hiking campaign, enunciating a clear game plan that sounded so plausible. Then a month ago, midstream, it changed to a plan of tightening past neutral (of course it does not know what neutral is) because the economy is just so darn strong -- just as the data starts to seriously weaken. Look at all of the top line revenues misses.
The pundits are worried, beaten up, then you get an oversold bounce that shows some really good strength (though not breadth) for a couple of sessions. Oh, that was THE time to buy say the experts, and it just so happens they were the ones buying they tell you. Okay, remember in the event the market falls.
Sure, we bought some as well, but we bought solid patterns. We will see if this pans out for gains, but we are not changing the plan, not kidding ourselves that this is some new bull run to new highs. As you know, we did not buy today. Playing these big tech names on a big gap upside on a second day of a bounce with no follow through is just not a good change of game plan.
Indeed, at this juncture it may be the case we let the plays we bought work then see if follow through occurs. If it does and more stocks are in good position, great. In the interim we will see how the move plays out and if any other great buys turn up.
Have a great evening!
End part 1
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Wednesday, October 31, 2018
Yellen is an idiot as she proved in trying to get -> more at:
Wages and salaries +3.1%, also the highest in 10 years. 2008. Hmm. The end of the prior expansion, then the drought through 2016. Policies changed, regulations slashed, taxes reformed, growth resumes. Amazing how this is shown time and time again, but no one learns.
Yellen: Feels two more rate hikes appropriate, fears the debt (NOW she fears it?). Says if she had a magic wand she would raise taxes. Why not, if you had a magic wand, have it eliminate waste, duplication, fraud, and other unnecessary spending by the government? Less government, motivated workers who do the will of the electorate versus pursue their own agendas? Yellen is an idiot as she proved in trying to get Greenspan to 'pick a number' in terms of what is acceptable inflation. The Fed members have untold hundreds of thousands of dollars of education, perhaps millions, between them, yet they absolutely do not understand how real world, real life economics works.
Earnings beats: GM; ATHM; CLX (but warned); EL; GRMN; YUM; EA; TMUS; AMGN; FEYE
Misses: FB (TL, users miss); CAKE (TL)
Warnings: BIDU. Duh.
OTHER MARKETS
Bonds: 3.151% vs 2.119%
EUR/USD: 1.1318 vs 1.1342
USD/JPY: 113.20 vs 113.09
Oil: 66.35, +0.17
Gold: 1218.40, -6.90
Futures holding their gains, gap upside at the open. Looks to be day 2 of the relief move off the second leg of selling. We will see if we can get any decent entries.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
Alert Key
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Market Alert - To the Close
Stocks gapped higher and are holding the gains, at least growth. The recent leaders take a back seat today, e.g. WMT, JNJ. FB helped launch a growth move and some are good, e.g. DATA. VRSN and TTWO look interesting, but this is more of a rebound move at this point. No follow through yet, just a good relief move in progress thus far.
SP500 33.09, 1.23%
NASDQ 155.56, 2.17%
DJ30 276.57, 1.11%
SP400 0.38%
RUTX 0.66%
SOX 1.38%
NASDAQ 100 2.48%
Again, FB helping lead a growth rebound but the patterns on the whole are not that solid to begin with. after this move I anticipate stocks such as JNJ, WMT reasserting themselves.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
Alert Key
http://www.investmenthouse.com/alertkey.htm
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SP500 33.09, 1.23%
NASDQ 155.56, 2.17%
DJ30 276.57, 1.11%
SP400 0.38%
RUTX 0.66%
SOX 1.38%
NASDAQ 100 2.48%
Again, FB helping lead a growth rebound but the patterns on the whole are not that solid to begin with. after this move I anticipate stocks such as JNJ, WMT reasserting themselves.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
Alert Key
http://www.investmenthouse.com/alertkey.htm
PLEASE DO NOT REPLY TO THIS EMAIL. USE THE CONTACT US PAGE ON OUR WEBSITE.
Customer Support: http://investmenthouse.com/contact_us.php
Market Alert - Pre-Market
Futures vs FV: SP +30.07; DJ +244.36; NASDAQ +103.63
Stocks are set to open significantly higher in an effort to continue the Tuesday rally. If they can close higher it would be the first 2-day 'winning streak' in a while. Much rejoicing. Yeah.
This looks to be the relief move from the second leg lower in the selling. Some are saying FAANG is back, a bottom is in, blah, blah, blah. Any upside has to prove itself. We saw good patterns breaking higher and moved in. There will be more moving higher today, but this is the second day of what is likely a relief move and it is opening with a gap. That makes finding good entries more difficult and it raises the risk in the risk/reward equation: if it is just a 4 to 5 session bounce then these gaps are eating up the potential gains.
ADP: 227K vs 180K exp vs 218K (from 230K). ADP was adjusted to closer reflect the government report starting a couple of years ago. It is as lousy as forecasting the Friday report as it was before.
China: Reports lower than expected manufacturing growth numbers but that is okay because the government 'vows' to provide more stimulus. Great! More stimulus is a market favorite -- even if it does further balloon China's utterly massive credit issues and debt.
Employment Cost Index, Q3: 0.8% vs 0.7% exp vs 0.6% Q2. 2.8% year/year, the fastest growth in 10 years (Q3 2008)
Wages and salaries +3.1%, also the highest in 10 years. 2008. Hmm. The end of the prior expansion, then the drought through 2016. Policies changed, regulations slashed, taxes reformed, growth resumes. Amazing how this is shown time and time again, but no one learns.
Yellen: Feels two more rate hikes appropriate, fears the debt (NOW she fears it?). Says if she had a magic wand she would raise taxes. Why not, if you had a magic wand, have it eliminate waste, duplication, fraud, and other unnecessary spending by the government? Less government, motivated workers who do the will of the electorate versus pursue their own agendas? Yellen is an idiot as she proved in trying to get Greenspan to 'pick a number' in terms of what is acceptable inflation. The Fed members have untold hundreds of thousands of dollars of education, perhaps millions, between them, yet they absolutely do not understand how real world, real life economics works.
Earnings beats: GM; ATHM; CLX (but warned); EL; GRMN; YUM; EA; TMUS; AMGN; FEYE
Misses: FB (TL, users miss); CAKE (TL)
Warnings: BIDU. Duh.
OTHER MARKETS
Bonds: 3.151% vs 2.119%
EUR/USD: 1.1318 vs 1.1342
USD/JPY: 113.20 vs 113.09
Oil: 66.35, +0.17
Gold: 1218.40, -6.90
Futures holding their gains, gap upside at the open. Looks to be day 2 of the relief move off the second leg of selling. We will see if we can get any decent entries.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
Alert Key
http://www.investmenthouse.com/alertkey.htm
PLEASE DO NOT REPLY TO THIS EMAIL. USE THE CONTACT US PAGE ON OUR WEBSITE.
Customer Support: http://investmenthouse.com/contact_us.php
Stocks are set to open significantly higher in an effort to continue the Tuesday rally. If they can close higher it would be the first 2-day 'winning streak' in a while. Much rejoicing. Yeah.
This looks to be the relief move from the second leg lower in the selling. Some are saying FAANG is back, a bottom is in, blah, blah, blah. Any upside has to prove itself. We saw good patterns breaking higher and moved in. There will be more moving higher today, but this is the second day of what is likely a relief move and it is opening with a gap. That makes finding good entries more difficult and it raises the risk in the risk/reward equation: if it is just a 4 to 5 session bounce then these gaps are eating up the potential gains.
ADP: 227K vs 180K exp vs 218K (from 230K). ADP was adjusted to closer reflect the government report starting a couple of years ago. It is as lousy as forecasting the Friday report as it was before.
China: Reports lower than expected manufacturing growth numbers but that is okay because the government 'vows' to provide more stimulus. Great! More stimulus is a market favorite -- even if it does further balloon China's utterly massive credit issues and debt.
Employment Cost Index, Q3: 0.8% vs 0.7% exp vs 0.6% Q2. 2.8% year/year, the fastest growth in 10 years (Q3 2008)
Wages and salaries +3.1%, also the highest in 10 years. 2008. Hmm. The end of the prior expansion, then the drought through 2016. Policies changed, regulations slashed, taxes reformed, growth resumes. Amazing how this is shown time and time again, but no one learns.
Yellen: Feels two more rate hikes appropriate, fears the debt (NOW she fears it?). Says if she had a magic wand she would raise taxes. Why not, if you had a magic wand, have it eliminate waste, duplication, fraud, and other unnecessary spending by the government? Less government, motivated workers who do the will of the electorate versus pursue their own agendas? Yellen is an idiot as she proved in trying to get Greenspan to 'pick a number' in terms of what is acceptable inflation. The Fed members have untold hundreds of thousands of dollars of education, perhaps millions, between them, yet they absolutely do not understand how real world, real life economics works.
Earnings beats: GM; ATHM; CLX (but warned); EL; GRMN; YUM; EA; TMUS; AMGN; FEYE
Misses: FB (TL, users miss); CAKE (TL)
Warnings: BIDU. Duh.
OTHER MARKETS
Bonds: 3.151% vs 2.119%
EUR/USD: 1.1318 vs 1.1342
USD/JPY: 113.20 vs 113.09
Oil: 66.35, +0.17
Gold: 1218.40, -6.90
Futures holding their gains, gap upside at the open. Looks to be day 2 of the relief move off the second leg of selling. We will see if we can get any decent entries.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
Alert Key
http://www.investmenthouse.com/alertkey.htm
PLEASE DO NOT REPLY TO THIS EMAIL. USE THE CONTACT US PAGE ON OUR WEBSITE.
Customer Support: http://investmenthouse.com/contact_us.php
Tuesday, October 30, 2018
The Daily, Part 1, 10-30-18
* * * *
10/30/2018 Investment House Daily
* * * *
Investment House Daily Subscribers:
MARKET ALERTS:
Targets hit: None issued
Entry alerts: DATA; FOSL; JNJ; MCD; WBA
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:
https://www.investmenthouse.com/alertdaily.html
********************************************************************
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
- After a crazy Monday, stocks bounce, but leadership is narrow.
- The good patterns from the same sectors lead: retail, food, drugs
- Indices show upside, but nothing yet suggests more than a bounce in a continuing move lower.
- Moved into some of the leaders, looking at a few more, but buying deeper and deeper into an unproven bounce amps the risk.
'Twas the night before Halloween, and all through the market -- a rally. Not huge, not blowout, and not 'all through the market.' Well-positioned stocks, however, moved higher. FAANG stocks were not well-positioned, and their moves lagged. Spooky. Other big techs lagged, e.g. MSFT, CSCO, though INTC showed excellent action.
The real move was in the same stocks that have led thus far: food, retail, select drugs, telecom. VZ added 3% to our position. WMT added 2.6%. KO 2.5%, MCD 3%, FOSL 8.2%, WBA 2.5%, JNJ 2.3%. DATA, one of those well-positioned tech stocks and a play we put on the report Monday, showed very good volume as it posted a 5% break higher off the 200 day SMA. The good setups yielded the good moves, as they should. We already are in VZ, WMT, JNJ, and we added FOSL, DATA, MCD, WBA, and more JNJ.
Does that mean it looks as if the second relief move is on? Could be. Certainly well-positioned stocks are moving . . . well, and as noted all along, those are the ones to focus on. It is rather good to see those are the best movers while FAANG and the like struggled on what was called a 'big' up session for the market.
SP500 41.38, 1.57%
NASDAQ 111.36, 1.58%
DJ30 431.72, 1.77%
SP400 1.73%
RUTX 1.99%
SOX 4.16%
NASDAQ 100 1.43%
VOLUME: NYSE +9%, NASDAQ -1%. Solid volume surge on NYSE as the stocks with good patterns, ones on NYSE, broke higher. That is good action. Finally some solid upside volume and on patterns that are solid. That gives some credence to the bounce working and these stocks able to provide some profits for us on this bounce.
CHARTS
To view, click on the following links:
http://investmenthouse1.com/ihmedia/f/charts/sp500.jpg
http://investmenthouse1.com/ihmedia/f/charts/NASDAQ.jpg
http://investmenthouse1.com/ihmedia/f/charts/DJ30.jpg
http://investmenthouse1.com/ihmedia/f/charts/RUTX.jpg
http://investmenthouse1.com/ihmedia/f/charts/SP400.jpg
http://investmenthouse1.com/ihmedia/f/charts/SOX.jpg
http://investmenthouse1.com/ihmedia/f/charts/nasdaq100.jpg
There was not a ton of change in the index charts. Of course not. Massive movement Monday makes Tuesday look like a piker. Compared to the prior Wednesday's drop, Monday was a hiccup.
But, really good stocks moved on really good volume. Any move that is going ot last a bit, big or small, is made of leadership. Those leaders tend to move the best not just on day one, but on most of the days. They tend to have more staying power. For those reasons we liked the move and it looks to be the start of the next leg -- at least for those stocks.
DJ30 worked very well because stocks such as WMT and MCD worked very well. Stronger volume than Monday on a solid move back through the 78% Fibonacci retracement.
SP500 showed excellent volume, the best since 10/11, the day it hit bottom for the first rebound of this selloff. That is a nice positive.
NASDAQ gapped lower, reversed upside on good but flat volume. That pushed NASDAQ back over the 78% Fibonacci retracement. Decent, but NASDAQ is not where the best action is at the moment.
SOX showed excellent action thanks to INTC. It has held the same support for a week and surged upside. Good start.
SP400 shows the same action as SOX, holding the same level for a week, bouncing upside Tuesday. Promising but the midcaps have to prove they are wanted versus the larger caps that worked Tuesday.
RUTX is showing the same action as SP400, SOX, and as with SP400, has to show it has some kind of power. Has to show they are wanted and that just does not appear to be the case now. Perhaps in January with a January effect.
LEADERSHIP
Same story: some software (e.g. DATA). Food (MCD, HSY, MKC, KO). Retail (WMT, FOSL, DG; ULTA had a bad day). Telecom (VZ, TMUS up afterhours). Drugs were mixed though JNJ was solid.
MARKET STATS
DJ30
Stats: +431.72 points (+1.77%) to close at 24874.64
Nasdaq
Stats: +111.36 points (+1.58%) to close at 7161.65
Volume: 2.624B (-0.77%)
Up Volume: 1.91B (+1.029B)
Down Volume: 745.19M (-1.015B)
A/D and Hi/Lo: Advancers led 2.09 to 1
Previous Session: Decliners led 1.45 to 1
New Highs: 19 (-4)
New Lows: 225 (-123)
S&P
Stats: +41.38 points (+1.57%) to close at 2682.63
NYSE Volume: 1.169B (+8.74%)
Up Volume: 914.615M (+481.168M)
Down Volume: 250.245M (-388.069M)
A/D and Hi/Lo: Advancers led 2.33 to 1
Previous Session: Decliners led 1.35 to 1
New Highs: 28 (+10)
New Lows: 336 (-65)
SENTIMENT
VIX: 23.35; -1.35. Never spiked so this suggests just a relief bounce.
VXN: 30.73; -1.02
VXO: 25.47; -1.81
Put/Call Ratio (CBOE): 1.18; -0.09. Eleven straight over 1.0 and 14 of 15. Extreme enough for a bounce.
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for them. Stubbornly low are those bears. It is best to see the bulls and bears converge, the former down, the latter up. They are, but in very slight moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1 versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9 versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5 versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6 versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1 versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5 versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7 versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8 versus 19.6 versus 19.8 versus 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: 3.119% versus 3.089%
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.089% versus 3.079% versus 3.126% versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779% versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus 3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061% versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus 3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99% versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.13455 versus 1.13760. Dollar strengthens and pushed euro to a lower closing low on this fade from late October.
Historical: 1.13760 versus 1.14042 versus 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus 1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus 1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus 1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus 1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus 1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus 1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus 1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus 1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus 1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 113.074 versus 112.58. Dollar extends the Monday break higher form support.
Historical: Last below 109 in June 2018: 112.58 versus 111.89 versus 112.391 versus 112.091 versus 112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus 112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus 113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus 113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus 112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus 112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus 111.064 versus 110.680
Oil: 66.18, -0.86. Breaking lower from the weak bounce to test the 200 day SMA.
Gold: 1225.30, -2.30. Testing the 20 day EMA in its 2+ week lateral consolidation.
WEDNESDAY
Okay, the indices were close to the bounce point per a 'symmetry' view as discussed Monday. Tuesday a solid upside break by the stocks that were set up the best. We picked up positions on several. Unfortunately we did not have them all on, e.g. KO, but we snagged some very good stocks making very good moves.
Now, this is a bounce so you cannot expect too much upside. Thus, continuing buying as the move progresses increases the risk. Sure it can always just continue higher, but that is something it has to prove, and that means a follow through session. By the time that happens you often get a pause then the follow through. If the follow through does not emerge, that pause turns into another selloff and a third leg lower.
Some still look great and possibly worth a buy, e.g. INTC now rallying off initially selling on earnings. We have made money on these before and INTC may pop the 200 day SMA this time. This is a more aggressive tech play. QCOM is very interesting here (earnings 11/7 after), CIEN is intriguing (11/29 before), and VRSN as well (1/24 after). These are more aggressive, not your food or retail. These are still not showing the moves yet outside INTC, so consider that in determining whether you enter. More risk, but they can move rapidly upside -- then downside if the market again spits the bit, and if this is just a bounce as anticipated . . . if you do, just be nimble.
Have a great evening!
End part 1
_______________________________________________________
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10/30/2018 Investment House Daily
* * * *
Investment House Daily Subscribers:
MARKET ALERTS:
Targets hit: None issued
Entry alerts: DATA; FOSL; JNJ; MCD; WBA
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:
https://www.investmenthouse.com/alertdaily.html
********************************************************************
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
- After a crazy Monday, stocks bounce, but leadership is narrow.
- The good patterns from the same sectors lead: retail, food, drugs
- Indices show upside, but nothing yet suggests more than a bounce in a continuing move lower.
- Moved into some of the leaders, looking at a few more, but buying deeper and deeper into an unproven bounce amps the risk.
'Twas the night before Halloween, and all through the market -- a rally. Not huge, not blowout, and not 'all through the market.' Well-positioned stocks, however, moved higher. FAANG stocks were not well-positioned, and their moves lagged. Spooky. Other big techs lagged, e.g. MSFT, CSCO, though INTC showed excellent action.
The real move was in the same stocks that have led thus far: food, retail, select drugs, telecom. VZ added 3% to our position. WMT added 2.6%. KO 2.5%, MCD 3%, FOSL 8.2%, WBA 2.5%, JNJ 2.3%. DATA, one of those well-positioned tech stocks and a play we put on the report Monday, showed very good volume as it posted a 5% break higher off the 200 day SMA. The good setups yielded the good moves, as they should. We already are in VZ, WMT, JNJ, and we added FOSL, DATA, MCD, WBA, and more JNJ.
Does that mean it looks as if the second relief move is on? Could be. Certainly well-positioned stocks are moving . . . well, and as noted all along, those are the ones to focus on. It is rather good to see those are the best movers while FAANG and the like struggled on what was called a 'big' up session for the market.
SP500 41.38, 1.57%
NASDAQ 111.36, 1.58%
DJ30 431.72, 1.77%
SP400 1.73%
RUTX 1.99%
SOX 4.16%
NASDAQ 100 1.43%
VOLUME: NYSE +9%, NASDAQ -1%. Solid volume surge on NYSE as the stocks with good patterns, ones on NYSE, broke higher. That is good action. Finally some solid upside volume and on patterns that are solid. That gives some credence to the bounce working and these stocks able to provide some profits for us on this bounce.
CHARTS
To view, click on the following links:
http://investmenthouse1.com/ihmedia/f/charts/sp500.jpg
http://investmenthouse1.com/ihmedia/f/charts/NASDAQ.jpg
http://investmenthouse1.com/ihmedia/f/charts/DJ30.jpg
http://investmenthouse1.com/ihmedia/f/charts/RUTX.jpg
http://investmenthouse1.com/ihmedia/f/charts/SP400.jpg
http://investmenthouse1.com/ihmedia/f/charts/SOX.jpg
http://investmenthouse1.com/ihmedia/f/charts/nasdaq100.jpg
There was not a ton of change in the index charts. Of course not. Massive movement Monday makes Tuesday look like a piker. Compared to the prior Wednesday's drop, Monday was a hiccup.
But, really good stocks moved on really good volume. Any move that is going ot last a bit, big or small, is made of leadership. Those leaders tend to move the best not just on day one, but on most of the days. They tend to have more staying power. For those reasons we liked the move and it looks to be the start of the next leg -- at least for those stocks.
DJ30 worked very well because stocks such as WMT and MCD worked very well. Stronger volume than Monday on a solid move back through the 78% Fibonacci retracement.
SP500 showed excellent volume, the best since 10/11, the day it hit bottom for the first rebound of this selloff. That is a nice positive.
NASDAQ gapped lower, reversed upside on good but flat volume. That pushed NASDAQ back over the 78% Fibonacci retracement. Decent, but NASDAQ is not where the best action is at the moment.
SOX showed excellent action thanks to INTC. It has held the same support for a week and surged upside. Good start.
SP400 shows the same action as SOX, holding the same level for a week, bouncing upside Tuesday. Promising but the midcaps have to prove they are wanted versus the larger caps that worked Tuesday.
RUTX is showing the same action as SP400, SOX, and as with SP400, has to show it has some kind of power. Has to show they are wanted and that just does not appear to be the case now. Perhaps in January with a January effect.
LEADERSHIP
Same story: some software (e.g. DATA). Food (MCD, HSY, MKC, KO). Retail (WMT, FOSL, DG; ULTA had a bad day). Telecom (VZ, TMUS up afterhours). Drugs were mixed though JNJ was solid.
MARKET STATS
DJ30
Stats: +431.72 points (+1.77%) to close at 24874.64
Nasdaq
Stats: +111.36 points (+1.58%) to close at 7161.65
Volume: 2.624B (-0.77%)
Up Volume: 1.91B (+1.029B)
Down Volume: 745.19M (-1.015B)
A/D and Hi/Lo: Advancers led 2.09 to 1
Previous Session: Decliners led 1.45 to 1
New Highs: 19 (-4)
New Lows: 225 (-123)
S&P
Stats: +41.38 points (+1.57%) to close at 2682.63
NYSE Volume: 1.169B (+8.74%)
Up Volume: 914.615M (+481.168M)
Down Volume: 250.245M (-388.069M)
A/D and Hi/Lo: Advancers led 2.33 to 1
Previous Session: Decliners led 1.35 to 1
New Highs: 28 (+10)
New Lows: 336 (-65)
SENTIMENT
VIX: 23.35; -1.35. Never spiked so this suggests just a relief bounce.
VXN: 30.73; -1.02
VXO: 25.47; -1.81
Put/Call Ratio (CBOE): 1.18; -0.09. Eleven straight over 1.0 and 14 of 15. Extreme enough for a bounce.
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for them. Stubbornly low are those bears. It is best to see the bulls and bears converge, the former down, the latter up. They are, but in very slight moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1 versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9 versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5 versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6 versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1 versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5 versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7 versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8 versus 19.6 versus 19.8 versus 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: 3.119% versus 3.089%
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.089% versus 3.079% versus 3.126% versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779% versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus 3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061% versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus 3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99% versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.13455 versus 1.13760. Dollar strengthens and pushed euro to a lower closing low on this fade from late October.
Historical: 1.13760 versus 1.14042 versus 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus 1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus 1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus 1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus 1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus 1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus 1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus 1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus 1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus 1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 113.074 versus 112.58. Dollar extends the Monday break higher form support.
Historical: Last below 109 in June 2018: 112.58 versus 111.89 versus 112.391 versus 112.091 versus 112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus 112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus 113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus 113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus 112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus 112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus 111.064 versus 110.680
Oil: 66.18, -0.86. Breaking lower from the weak bounce to test the 200 day SMA.
Gold: 1225.30, -2.30. Testing the 20 day EMA in its 2+ week lateral consolidation.
WEDNESDAY
Okay, the indices were close to the bounce point per a 'symmetry' view as discussed Monday. Tuesday a solid upside break by the stocks that were set up the best. We picked up positions on several. Unfortunately we did not have them all on, e.g. KO, but we snagged some very good stocks making very good moves.
Now, this is a bounce so you cannot expect too much upside. Thus, continuing buying as the move progresses increases the risk. Sure it can always just continue higher, but that is something it has to prove, and that means a follow through session. By the time that happens you often get a pause then the follow through. If the follow through does not emerge, that pause turns into another selloff and a third leg lower.
Some still look great and possibly worth a buy, e.g. INTC now rallying off initially selling on earnings. We have made money on these before and INTC may pop the 200 day SMA this time. This is a more aggressive tech play. QCOM is very interesting here (earnings 11/7 after), CIEN is intriguing (11/29 before), and VRSN as well (1/24 after). These are more aggressive, not your food or retail. These are still not showing the moves yet outside INTC, so consider that in determining whether you enter. More risk, but they can move rapidly upside -- then downside if the market again spits the bit, and if this is just a bounce as anticipated . . . if you do, just be nimble.
Have a great evening!
End part 1
_______________________________________________________
Member: tweet@investbilling.com
Customer Support: http://www.InvestBilling.com
1153 Bergen Pkwy - Suite I #502 - Evergreen, CO 80439
PLEASE DO NOT REPLY TO THIS EMAIL. USE THE CONTACT US PAGE ON OUR WEBSITE.
Monday, October 29, 2018
The Daily, Part 1, 10-29-18
* * * *
10/29/2018 Investment House Daily
* * * *
Investment House Daily Subscribers:
MARKET ALERTS:
Targets hit: None issued
Entry alerts: VZ
Trailing stops: None issued
Stop alerts: FEYE; VIAV; VMW
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:
https://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:
https://investmenthouse1.com/ihmedia/f/mo/mo.mp4
TO VIEW THE TECHNICAL SUMMARY VIDEO CLICK THE FOLLOWING LINK:
https://investmenthouse1.com/ihmedia/f/ts/ts.mp4
TO VIEW THE NEXT SESSION VIDEO CLICK THE FOLLOWING LINK:
https://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
- M&A heats up the excitement, same stories -- and same market mindset -- splash cold water on the move
- IBM overpaying for RHT no match for potential tariffs on all Chinese products
- Indices surge, reverse to probe lower, recover some lost ground. Well, the volatility is still there.
- The current second leg lower in the selling is just about matching the first leg. Rallies and selloffs typically move in relatively symmetric moves, meaning a second relief bounce is getting near.
- If relief bounce mirrors the first, it won't be much and difficult to play
- Watch for the bounce, play a few decent setups, then prep for a third then fourth leg downside with downside plays.
Monday was a classic example of hope shot down. A week of sharp selling pushed the indices to lower lows on the current selloff. Late Sunday IBM announced the acquisition of RHT to push Big Blue's demise further along the calendar. Futures surged and they carried over to Monday. Further, reports were that China was considering cutting auto import taxes 50%. Some cracks in the Great Wall of Tariffs perhaps? Surely Christmas was coming early.
Stocks gapped higher and rallied smartly to 10:00ET. They tested into midday, moved laterally for a couple of hours, setting up the last two hours to move up. Didn't happen. The sellers came in and used the upside to sell. The last two hours were a downside clinic with prices selling sharply, slacking off and holding steady, then selling of sharply again. And again. New lows on every index. Then with 20 minutes left a short covering bounce carried the indices well off the intraday lows.
Well off the lows. The Dow recovered 320 points to close (off 245 points on the day; a 920 point swing from high to low, 595 points high to close). NASDAQ 127 points low to close (372 points high to low, 127 points low to close). Impressive volatility yet again with the bulk being the same high to low action as sellers used upside to make downside. The old 'when life gives you lemonade, make lemons.' Or, 'snatching defeat from the jaws of victory.'
SP500 -17.44, -0.66%
NASDAQ -116.92, -1.63%
DJ30 -245.39, -0.99%
SP400 -0.36%
RUTX -0.44%
SOX -1.11%
NASDAQ 100 -2.02%
Heck, when you look at the final results only, it actually looks good compared to the recent action. Gee honey, the Dow only lost 245 points today and NASDAQ kept its losses under 2%! Buy, buy, buy!
VOLUME:
ADVANCE/DECLINE:
The catalyst was said to be a report that the Trump administration would implement tariffs on ALL Chinese goods if the two countries could not achieve a deal at their next meeting, presumably the November G-20 gathering.
Sure, whatever. If it is not clear by now that the US/China trade war is no longer about China importing more goods, dropping the tariffs, and no more stealing of our IP, then it is time to wake up. China and its 2025 program has turned China from a competitor we only needed even trade footing with to the equivalent of Reagan's USSR. Trump sees China building its military forces with our stolen technology and has had an epiphany: China is communist, communists want to spread, communists will do anything to get their way. The globalists have only enabled China's theft and treachery. It will be difficult at best for freedom in the East if China continues virtually unchecked. Trump sees this, sees China's economic weakness, and is using our economic strength to play his hand. Thus, just as with Reagan, he is upset with a Fed that wants to stymie the US economy just when we need to pour it on and bury China. History repeats again and again. With luck, perhaps the outcome will be the same here as well.
I digress, but not really. It is all tied in, the pundits don't really get it just as they did not get it in the 1980's. The CIA, tasked with knowing the status of our enemies was embarrassingly, yeah verily grossly negligent, with its USSR economic assessment. Is it any surprise that the conventional wisdom class does not get what is going on? They are so smart they are stupid because they fall into the trap of believing they are the smartest people in the room, indeed anywhere, and thus they miss the subtleties. That is why history repeats, and repeats, and repeats despite their considered efforts.
So, what does this have to do with the markets? Well, they have figured out this China trade issue. Moreover, this could very well be the Reykjavic situation where Gorbachev, knowing the USSR was in decay and could not keep up with the US, gave Reagan everything he wanted, but Reagan knew what Gorbachev knew and that he could get more -- and did. That set the stage for the USSR's collapse.
Now the markets may not be there, but they know we need to stay economically strong to finish what we started -- and are winning. That leads to the Fed and its notion it has to hike until it breaks something. The market HATES that not only for its impact on the market -- the Fed doesn't even know what the 'neutral interest rate' that it seeks to surpass actually is. It works on a 'know it when it sees it' standard, but of course it will only 'see it' when the market has broken and the economy hits the skids.
On top of that, the midterms. The republicans have to keep the both houses of Congress to have any hope of more economic reform. Until that is decided, that is a weight on stocks similar to the Fed issues.
THE MARKET
Okay, that is the background. Here is what the market is doing right now and a bit of prognostication. I know, I know, looking for bottoms like everyone else, right? Well, you need to look. More accurately, however, I am looking for patterns. There is one that is more relevant than the people guessing or giving up on guessing out there.
The market moves in rhythms or phases or sequences or waves -- whatever you want to call them -- just as everything else in the world. That is why Fibonacci movements are noteworthy. Rallies tend to move in certain symmetrical steps as do selloffs.
We are watching the Fibonacci's as well as the length and timing of the downside legs. After the Monday low, the indices are within striking distance of the same point losses as the first leg lower. They are already there in terms of the number of sessions.
Okay, here are the numbers.
NASDAQ: First leg 833 points, 9 sessions. Second leg 748 points, 9 sessions. Roughly 85 points to match the first leg lower. It is worth noting that another 100 points lower from the Monday low is the January/June 2016 trendline. That would bring the two selloff legs very similar in points lower and time as well. In market symmetry terms, that suggests a bounce is just ahead. Not a bottom, just a new bounce. Note that if NASDAQ does hit that trendline it will have given up 100% of the April through August rally. That removes a lot of fluff.
Tradeable? The last one was not outside very short term trades. After gapping to the selloff low, that first leg gapped upside rather big. The move capped out the fourth session off the low. Not much opportunity as each session started with a gap, but of course we will look for and see if we can get into some good plays. Still, it is not the kind of move, untested, no follow through, that you can back up the truck to.
SP500: Gapped up, sold off to a lower low, getting closer to the February/March lows of the year--16 points away from the Monday low. That would match the leg one selloff: 230 points, 7 sessions. Leg two 214 points, 8 sessions. 214 + 16 to the FEB/MAR lows = 230 points.
DJ30: Was up big despite IBM's decline on the RHT acquisition. Then BA started an epic selloff and it all went to hell in a handbasket with those massive point swings noted earlier. First leg: 1884 points, 7 sessions. Second session: 1695 points, 8 sessions. Another 190 points from the Monday low matches the first leg's losses and pretty much puts DJ30 at the June low where the last part of the rally higher started.
SP400: Held its ground relatively well, gapping upside, rallying higher, selling it all off, matching the Friday low, recovering some. It is sitting at the February low, the prior low for the year from which the rally into September launched. Okay, it is oversold enough. First leg 150 points lost, second leg 120 points lost.
RUTX: Did not start higher, but rallied upside. Then gave it up and sold but held just over the Friday intraday low. Rebounded to cut the losses, showing a doji. Sold to just 23 points from the February low, the Monday carnage in the large cap indices did not really impact it. Could be a bit sold out.
SOX: Found a lower low, rebounded to a rather modest 1.11% loss; for SOX, not bad. Tested the next level of prices at 1120 from the July 2017 peaks, and September interim low. First leg: 169 points, 7 sessions. Second leg 176 points, 9 sessions. Looks about done -- in symmetry terms.
LEADERSHIP
Software: All revved up at the start thanks to the RHT acquisition. Then the gaps were sold. CRM sold below the 200 day SMA to close, its first time below that level in 2 years. FFIV gapped higher, sold back to close just about flat at the 200 day. ADBE ditto. DATA the same. And yes, VRSN. Gave up the gain but also all held or held close to the 200 day SMA in still decent setups for a bounce. Now if the 'symmetry' analysis holds water, that they held their position suggests that if there is a final test that starts a second oversold bounce, software would be right up at the front.
Retail: WMT surged then gave just about all up; WMT still works. ULTA gapped up, rallied, gave back a lot but still upside for the day. TSCO gapped and rallied to a higher high. FOSL tried the 50 day MA's, faded to a still solid 3% gain. DG tried to rally, kept 2% but gave up as much.
Food: Still hanging in, managing gains when most did not. KO, MKC, PEP were all up. MCD is still testing its earnings move.
Biotechs/Drugs/Pharma: Not a great session though JNJ managed a modest gain. ACAD tried higher, faded. PFE edged over the 50 day SMA. NVAX tried higher, reversed to a loss. WBA moved a bit higher, still looks interesting.
Telecom: VZ moved higher, gave up some ground, held a decent gain. AUDC is testing that surge higher. Going to watch it. CIEN is holding the 50 day MA. Some promise.
Precious metals: HMY, AU still testing, still not bad.
MARKET STATS
DJ30
Stats: -245.39 points (-0.99%) to close at 24442.92
Nasdaq
Stats: -116.92 points (-1.63%) to close at 7050.29
Volume: 2.68B (-9.76%)
Up Volume: 880.61M (+132.17M)
Down Volume: 1.76B (-450M)
A/D and Hi/Lo: Decliners led 1.45 to 1
Previous Session: Decliners led 2.12 to 1
New Highs: 23 (+4)
New Lows: 348 (-98)
S&P
Stats: -17.44 points (-0.66%) to close at 2641.25
NYSE Volume: 1.075B (-4.35%)
Up Volume: 433.447M (+152.75M)
Down Volume: 638.314M (-190.823M)
A/D and Hi/Lo: Decliners led 1.35 to 1
Previous Session: Decliners led 2.6 to 1
New Highs: 18 (+9)
New Lows: 401 (-127)
SENTIMENT
VIX: 24.70; +0.54. VIX 'surged' to 27.86, edging out the Friday high. Still below the earlier October peak. Still not showing any real increase in worry, fear, panic.
VXN: 31.75; +1.88
VXO: 27.28; +0.10
Put/Call Ratio (CBOE): 1.27; -0.05. Ten straight closes over 1.0 and 13 of the last 14 sessions. That is getting to the point of extreme as were the new lows last week, volume ratios.
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for them. Stubbornly low are those bears. It is best to see the bulls and bears converge, the former down, the latter up. They are, but in very slight moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1 versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9 versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5 versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6 versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1 versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5 versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7 versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8 versus 19.6 versus 19.8 versus 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: 3.089% versus 3.079%. Bonds are up modestly the past 3 weeks, but they are not showing the kind of upside that would suggest imminent trouble. There is a dearth of direct bidders on treasury auctions, and that is keeping rates higher, bonds lower.
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.079% versus 3.126% versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779% versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus 3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061% versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus 3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99% versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.13760 versus 1.14042.
Historical: 1.14042 versus 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus 1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus 1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus 1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus 1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus 1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus 1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus 1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus 1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus 1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 112.58 versus 111.89. Pretty sharp surge through the 50 day MA's.
Historical: Last below 109 in June 2018: 111.89 versus 112.391 versus 112.091 versus 112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus 112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus 113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus 113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus 112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus 112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus 111.064 versus 110.680
Oil: 67.04, -0.55. Tried to move though the 200 day SMA, faded to close just below it.
Gold: 1227.60, -8.20. Still moving more or less laterally along the 10 day EMA.
TUESDAY
The indices are breaking through the 78% Fibonacci retracement and breaking up the potential ABCD bounces. They are a bit more oversold, getting close to the next support levels as noted. The legs lower are just about the same in size and duration. No, not calling a bottom, just nothing that moves come in waves, and at the first part of the moves they are typically symmetrical. This is the second leg lower so it would typically be very similar in size and duration to leg one.
With that, you watch for a rebound move that is likely similar to the prior one. That was no great shakes, just up four sessions and the last not much before it rolled over.
There are still good patterns that held up during the selloff and we are looking at positions on them with some current plays on the report. It could be some of the software stocks holding the 200 day SMA even in the Monday up and down make playable upside breaks. We will keep some of those in the hopper.
That said, if things remain the same, this selling could see a bounce in relief then another leg or two downside. Then perhaps something with a solid foundation takes shape for a more tradeable move higher.
That means on the bounce higher we may play some upside, but we will look for downside setups to take advantage of the third and then fourth legs lower. Now is not the time; Monday shook out some more sellers as it sold off then rebounded decently. That makes further downside from here problematic. Let them bounce and stall, then play the fall.
Have a great evening!
End part 1
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10/29/2018 Investment House Daily
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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
- M&A heats up the excitement, same stories -- and same market mindset -- splash cold water on the move
- IBM overpaying for RHT no match for potential tariffs on all Chinese products
- Indices surge, reverse to probe lower, recover some lost ground. Well, the volatility is still there.
- The current second leg lower in the selling is just about matching the first leg. Rallies and selloffs typically move in relatively symmetric moves, meaning a second relief bounce is getting near.
- If relief bounce mirrors the first, it won't be much and difficult to play
- Watch for the bounce, play a few decent setups, then prep for a third then fourth leg downside with downside plays.
Monday was a classic example of hope shot down. A week of sharp selling pushed the indices to lower lows on the current selloff. Late Sunday IBM announced the acquisition of RHT to push Big Blue's demise further along the calendar. Futures surged and they carried over to Monday. Further, reports were that China was considering cutting auto import taxes 50%. Some cracks in the Great Wall of Tariffs perhaps? Surely Christmas was coming early.
Stocks gapped higher and rallied smartly to 10:00ET. They tested into midday, moved laterally for a couple of hours, setting up the last two hours to move up. Didn't happen. The sellers came in and used the upside to sell. The last two hours were a downside clinic with prices selling sharply, slacking off and holding steady, then selling of sharply again. And again. New lows on every index. Then with 20 minutes left a short covering bounce carried the indices well off the intraday lows.
Well off the lows. The Dow recovered 320 points to close (off 245 points on the day; a 920 point swing from high to low, 595 points high to close). NASDAQ 127 points low to close (372 points high to low, 127 points low to close). Impressive volatility yet again with the bulk being the same high to low action as sellers used upside to make downside. The old 'when life gives you lemonade, make lemons.' Or, 'snatching defeat from the jaws of victory.'
SP500 -17.44, -0.66%
NASDAQ -116.92, -1.63%
DJ30 -245.39, -0.99%
SP400 -0.36%
RUTX -0.44%
SOX -1.11%
NASDAQ 100 -2.02%
Heck, when you look at the final results only, it actually looks good compared to the recent action. Gee honey, the Dow only lost 245 points today and NASDAQ kept its losses under 2%! Buy, buy, buy!
VOLUME:
ADVANCE/DECLINE:
The catalyst was said to be a report that the Trump administration would implement tariffs on ALL Chinese goods if the two countries could not achieve a deal at their next meeting, presumably the November G-20 gathering.
Sure, whatever. If it is not clear by now that the US/China trade war is no longer about China importing more goods, dropping the tariffs, and no more stealing of our IP, then it is time to wake up. China and its 2025 program has turned China from a competitor we only needed even trade footing with to the equivalent of Reagan's USSR. Trump sees China building its military forces with our stolen technology and has had an epiphany: China is communist, communists want to spread, communists will do anything to get their way. The globalists have only enabled China's theft and treachery. It will be difficult at best for freedom in the East if China continues virtually unchecked. Trump sees this, sees China's economic weakness, and is using our economic strength to play his hand. Thus, just as with Reagan, he is upset with a Fed that wants to stymie the US economy just when we need to pour it on and bury China. History repeats again and again. With luck, perhaps the outcome will be the same here as well.
I digress, but not really. It is all tied in, the pundits don't really get it just as they did not get it in the 1980's. The CIA, tasked with knowing the status of our enemies was embarrassingly, yeah verily grossly negligent, with its USSR economic assessment. Is it any surprise that the conventional wisdom class does not get what is going on? They are so smart they are stupid because they fall into the trap of believing they are the smartest people in the room, indeed anywhere, and thus they miss the subtleties. That is why history repeats, and repeats, and repeats despite their considered efforts.
So, what does this have to do with the markets? Well, they have figured out this China trade issue. Moreover, this could very well be the Reykjavic situation where Gorbachev, knowing the USSR was in decay and could not keep up with the US, gave Reagan everything he wanted, but Reagan knew what Gorbachev knew and that he could get more -- and did. That set the stage for the USSR's collapse.
Now the markets may not be there, but they know we need to stay economically strong to finish what we started -- and are winning. That leads to the Fed and its notion it has to hike until it breaks something. The market HATES that not only for its impact on the market -- the Fed doesn't even know what the 'neutral interest rate' that it seeks to surpass actually is. It works on a 'know it when it sees it' standard, but of course it will only 'see it' when the market has broken and the economy hits the skids.
On top of that, the midterms. The republicans have to keep the both houses of Congress to have any hope of more economic reform. Until that is decided, that is a weight on stocks similar to the Fed issues.
THE MARKET
Okay, that is the background. Here is what the market is doing right now and a bit of prognostication. I know, I know, looking for bottoms like everyone else, right? Well, you need to look. More accurately, however, I am looking for patterns. There is one that is more relevant than the people guessing or giving up on guessing out there.
The market moves in rhythms or phases or sequences or waves -- whatever you want to call them -- just as everything else in the world. That is why Fibonacci movements are noteworthy. Rallies tend to move in certain symmetrical steps as do selloffs.
We are watching the Fibonacci's as well as the length and timing of the downside legs. After the Monday low, the indices are within striking distance of the same point losses as the first leg lower. They are already there in terms of the number of sessions.
Okay, here are the numbers.
NASDAQ: First leg 833 points, 9 sessions. Second leg 748 points, 9 sessions. Roughly 85 points to match the first leg lower. It is worth noting that another 100 points lower from the Monday low is the January/June 2016 trendline. That would bring the two selloff legs very similar in points lower and time as well. In market symmetry terms, that suggests a bounce is just ahead. Not a bottom, just a new bounce. Note that if NASDAQ does hit that trendline it will have given up 100% of the April through August rally. That removes a lot of fluff.
Tradeable? The last one was not outside very short term trades. After gapping to the selloff low, that first leg gapped upside rather big. The move capped out the fourth session off the low. Not much opportunity as each session started with a gap, but of course we will look for and see if we can get into some good plays. Still, it is not the kind of move, untested, no follow through, that you can back up the truck to.
SP500: Gapped up, sold off to a lower low, getting closer to the February/March lows of the year--16 points away from the Monday low. That would match the leg one selloff: 230 points, 7 sessions. Leg two 214 points, 8 sessions. 214 + 16 to the FEB/MAR lows = 230 points.
DJ30: Was up big despite IBM's decline on the RHT acquisition. Then BA started an epic selloff and it all went to hell in a handbasket with those massive point swings noted earlier. First leg: 1884 points, 7 sessions. Second session: 1695 points, 8 sessions. Another 190 points from the Monday low matches the first leg's losses and pretty much puts DJ30 at the June low where the last part of the rally higher started.
SP400: Held its ground relatively well, gapping upside, rallying higher, selling it all off, matching the Friday low, recovering some. It is sitting at the February low, the prior low for the year from which the rally into September launched. Okay, it is oversold enough. First leg 150 points lost, second leg 120 points lost.
RUTX: Did not start higher, but rallied upside. Then gave it up and sold but held just over the Friday intraday low. Rebounded to cut the losses, showing a doji. Sold to just 23 points from the February low, the Monday carnage in the large cap indices did not really impact it. Could be a bit sold out.
SOX: Found a lower low, rebounded to a rather modest 1.11% loss; for SOX, not bad. Tested the next level of prices at 1120 from the July 2017 peaks, and September interim low. First leg: 169 points, 7 sessions. Second leg 176 points, 9 sessions. Looks about done -- in symmetry terms.
LEADERSHIP
Software: All revved up at the start thanks to the RHT acquisition. Then the gaps were sold. CRM sold below the 200 day SMA to close, its first time below that level in 2 years. FFIV gapped higher, sold back to close just about flat at the 200 day. ADBE ditto. DATA the same. And yes, VRSN. Gave up the gain but also all held or held close to the 200 day SMA in still decent setups for a bounce. Now if the 'symmetry' analysis holds water, that they held their position suggests that if there is a final test that starts a second oversold bounce, software would be right up at the front.
Retail: WMT surged then gave just about all up; WMT still works. ULTA gapped up, rallied, gave back a lot but still upside for the day. TSCO gapped and rallied to a higher high. FOSL tried the 50 day MA's, faded to a still solid 3% gain. DG tried to rally, kept 2% but gave up as much.
Food: Still hanging in, managing gains when most did not. KO, MKC, PEP were all up. MCD is still testing its earnings move.
Biotechs/Drugs/Pharma: Not a great session though JNJ managed a modest gain. ACAD tried higher, faded. PFE edged over the 50 day SMA. NVAX tried higher, reversed to a loss. WBA moved a bit higher, still looks interesting.
Telecom: VZ moved higher, gave up some ground, held a decent gain. AUDC is testing that surge higher. Going to watch it. CIEN is holding the 50 day MA. Some promise.
Precious metals: HMY, AU still testing, still not bad.
MARKET STATS
DJ30
Stats: -245.39 points (-0.99%) to close at 24442.92
Nasdaq
Stats: -116.92 points (-1.63%) to close at 7050.29
Volume: 2.68B (-9.76%)
Up Volume: 880.61M (+132.17M)
Down Volume: 1.76B (-450M)
A/D and Hi/Lo: Decliners led 1.45 to 1
Previous Session: Decliners led 2.12 to 1
New Highs: 23 (+4)
New Lows: 348 (-98)
S&P
Stats: -17.44 points (-0.66%) to close at 2641.25
NYSE Volume: 1.075B (-4.35%)
Up Volume: 433.447M (+152.75M)
Down Volume: 638.314M (-190.823M)
A/D and Hi/Lo: Decliners led 1.35 to 1
Previous Session: Decliners led 2.6 to 1
New Highs: 18 (+9)
New Lows: 401 (-127)
SENTIMENT
VIX: 24.70; +0.54. VIX 'surged' to 27.86, edging out the Friday high. Still below the earlier October peak. Still not showing any real increase in worry, fear, panic.
VXN: 31.75; +1.88
VXO: 27.28; +0.10
Put/Call Ratio (CBOE): 1.27; -0.05. Ten straight closes over 1.0 and 13 of the last 14 sessions. That is getting to the point of extreme as were the new lows last week, volume ratios.
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for them. Stubbornly low are those bears. It is best to see the bulls and bears converge, the former down, the latter up. They are, but in very slight moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work, where does the ammunition to drive the market come from? There is always new money to start a new year. After that is used will more money be coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1 versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9 versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5 versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6 versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1 versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5 versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7 versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8 versus 19.6 versus 19.8 versus 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: 3.089% versus 3.079%. Bonds are up modestly the past 3 weeks, but they are not showing the kind of upside that would suggest imminent trouble. There is a dearth of direct bidders on treasury auctions, and that is keeping rates higher, bonds lower.
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.079% versus 3.126% versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779% versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus 3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061% versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus 3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99% versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.13760 versus 1.14042.
Historical: 1.14042 versus 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus 1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus 1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus 1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus 1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus 1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus 1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus 1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus 1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus 1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 112.58 versus 111.89. Pretty sharp surge through the 50 day MA's.
Historical: Last below 109 in June 2018: 111.89 versus 112.391 versus 112.091 versus 112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus 112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus 113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus 113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus 112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus 112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus 111.064 versus 110.680
Oil: 67.04, -0.55. Tried to move though the 200 day SMA, faded to close just below it.
Gold: 1227.60, -8.20. Still moving more or less laterally along the 10 day EMA.
TUESDAY
The indices are breaking through the 78% Fibonacci retracement and breaking up the potential ABCD bounces. They are a bit more oversold, getting close to the next support levels as noted. The legs lower are just about the same in size and duration. No, not calling a bottom, just nothing that moves come in waves, and at the first part of the moves they are typically symmetrical. This is the second leg lower so it would typically be very similar in size and duration to leg one.
With that, you watch for a rebound move that is likely similar to the prior one. That was no great shakes, just up four sessions and the last not much before it rolled over.
There are still good patterns that held up during the selloff and we are looking at positions on them with some current plays on the report. It could be some of the software stocks holding the 200 day SMA even in the Monday up and down make playable upside breaks. We will keep some of those in the hopper.
That said, if things remain the same, this selling could see a bounce in relief then another leg or two downside. Then perhaps something with a solid foundation takes shape for a more tradeable move higher.
That means on the bounce higher we may play some upside, but we will look for downside setups to take advantage of the third and then fourth legs lower. Now is not the time; Monday shook out some more sellers as it sold off then rebounded decently. That makes further downside from here problematic. Let them bounce and stall, then play the fall.
Have a great evening!
End part 1
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Market Alert - Last Hour
Another higher open that turns to losses. Much higher open, much larger turn to losses, 700+ on DJ30. The large cap indices are diving lower. As expected, growth is getting hit but small caps are showing very good relative strength -- 0.6% downside is considered very good. A sign of the times.
Stocks are bouncing fairly hard late. DJ30 was off 450 points and is trimming the losses rather rapidly.
SP500 -28.93, -1.09%
NASDAQ -164.22, -2.27%
DJ30 -348.50, -1.35%
SP400 -0.63%
RUTX -0.98% (selling rapidly late)
SOX -1.55%
NASDAQ 100 -2.59%
Stocks hit a high a half hour into trade, tested, then kept sliding. Things became interesting as BA continued to melt down after that crash in India. More so when reports emerged that the Trump administration would hit ALL China goods with tariffs if the meeting between Trump and Xi fails to produce results. Well, you would think it would not be good news if it failed . . .
In any event, those were seized upon as a reason to sell with vigor. Stocks have sold straight down the past 2 hours, just now starting a short covering rebound as the closing bells closes in. Market is selling upside moves, even intraday ones, with aggression.
The move pushes growth into a further bear market and of course there is no sign of a bottom other than the usual bottom sightings each session on financial news stations. VIX is at a whopping 26.78, below its intraday high last week.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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Stocks are bouncing fairly hard late. DJ30 was off 450 points and is trimming the losses rather rapidly.
SP500 -28.93, -1.09%
NASDAQ -164.22, -2.27%
DJ30 -348.50, -1.35%
SP400 -0.63%
RUTX -0.98% (selling rapidly late)
SOX -1.55%
NASDAQ 100 -2.59%
Stocks hit a high a half hour into trade, tested, then kept sliding. Things became interesting as BA continued to melt down after that crash in India. More so when reports emerged that the Trump administration would hit ALL China goods with tariffs if the meeting between Trump and Xi fails to produce results. Well, you would think it would not be good news if it failed . . .
In any event, those were seized upon as a reason to sell with vigor. Stocks have sold straight down the past 2 hours, just now starting a short covering rebound as the closing bells closes in. Market is selling upside moves, even intraday ones, with aggression.
The move pushes growth into a further bear market and of course there is no sign of a bottom other than the usual bottom sightings each session on financial news stations. VIX is at a whopping 26.78, below its intraday high last week.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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Market Alert - Pre-Market
Futures vs FV: SP +35.91; DJ +215.61; NASDAQ +103.60
Stock futures rose late Sunday and have steadily increased through the pre-market session. There is news acting as a trigger for a group of indices that were oversold and holding support levels.
M&A: IBM making a Hail Mary pass by acquiring RHT in a deal offering a 63% premium. After IBM's series of earnings reports the past few years it was clear it was swirling in the toilet. It is trying something new in what is almost a bet the farm move. The rest of the market likes it -- software looked to be the best set group to bounce after this leg of the selloff, and this news is helping that sector.
Personal Income: 0.2% vs 0.4% exp vs 0.4 prior (from 0.3). Slowest year/year since March.
Spending: 0.4% vs 0.4% exp vs 0.5 prior (from 0.3%). Slowest since May
PCE Core: 2.0% vs 2.0% prior
China: Reports it is considering lowering the tax on foreign autos by 50%.
EU: Merkel not running for reelection and thus will be through in 2021. After five terms she has to set the stage carefully for her succession. It is interesting because she may come close to being chancellor when the EU breaks apart. It's refusal to work with its third largest economy shows that it is not a union but a group controlled mostly by Germany and to a much lesser extent France. In other words, the EU does not represent the member countries but an oligarchy of globalists. The EU needs to break up. It has never accomplished the dreams when it was formed and its real legacy will be the elimination of many smaller European countries.
OTHER MARKETS
BONDS: 3.096% VS 3.079%
EUR/USD: 1.1363 vs 1.1402
USD/JPY: 112.33 vs 111.83
Oil: 67.31, -0.28
Gold: 1233.50, -2.70
Light on earnings this morning but will ramp up this evening and midweek. The financial stations are talking about this bounce in terms of 'if it can hold.' A CNBC anchor just said the trend is in 'jeopardy.' With the indices at support and some actual pessimism about this bounce's chances, it likely has a chance to hold.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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Stock futures rose late Sunday and have steadily increased through the pre-market session. There is news acting as a trigger for a group of indices that were oversold and holding support levels.
M&A: IBM making a Hail Mary pass by acquiring RHT in a deal offering a 63% premium. After IBM's series of earnings reports the past few years it was clear it was swirling in the toilet. It is trying something new in what is almost a bet the farm move. The rest of the market likes it -- software looked to be the best set group to bounce after this leg of the selloff, and this news is helping that sector.
Personal Income: 0.2% vs 0.4% exp vs 0.4 prior (from 0.3). Slowest year/year since March.
Spending: 0.4% vs 0.4% exp vs 0.5 prior (from 0.3%). Slowest since May
PCE Core: 2.0% vs 2.0% prior
China: Reports it is considering lowering the tax on foreign autos by 50%.
EU: Merkel not running for reelection and thus will be through in 2021. After five terms she has to set the stage carefully for her succession. It is interesting because she may come close to being chancellor when the EU breaks apart. It's refusal to work with its third largest economy shows that it is not a union but a group controlled mostly by Germany and to a much lesser extent France. In other words, the EU does not represent the member countries but an oligarchy of globalists. The EU needs to break up. It has never accomplished the dreams when it was formed and its real legacy will be the elimination of many smaller European countries.
OTHER MARKETS
BONDS: 3.096% VS 3.079%
EUR/USD: 1.1363 vs 1.1402
USD/JPY: 112.33 vs 111.83
Oil: 67.31, -0.28
Gold: 1233.50, -2.70
Light on earnings this morning but will ramp up this evening and midweek. The financial stations are talking about this bounce in terms of 'if it can hold.' A CNBC anchor just said the trend is in 'jeopardy.' With the indices at support and some actual pessimism about this bounce's chances, it likely has a chance to hold.
______________________________________
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
Alert Key
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Sunday, October 28, 2018
Market Has Bounce Potential (Weekend Newsletter)
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| Market Summary (continued) Friday did little to alter the back and forth volatility as AMZN and GOOG earnings helped the market sell off to new lows on this leg lower. Bids returned, however, and pushed the indices back above the Wednesday lows. That turned truly impressive losses to just 1% to 2% declines on the indices. NASDAQ for instance closed lower 151 points but was off 260+ on the low. So there was some recovery. SP500 -46.88, -1.73% NASDAQ -151.13, -2.07% DJ30 -296.24, -1.19% SP400 -1.06% RUTX -1.10% SOX -1.72% NASDAQ 100 -2.34% VOLUME: NYSE +5%, NASDAQ +7%. Volume up on a selloff but also on a recovery off the lows to hold the prior low. Decent enough. ADVANCE/DECLINE: NYSE -2.6:1, NASDAQ -2.2:1. Was a lot worse before the recovery off the low. NEW LOWS: NYSE 528, NASDAQ 446. That lower low pushed up the new lows once more. There was also, despite the up and down from session to session, a steady trend lower. Perhaps the selloff was enough to put in a bounce. Perhaps it was just short covering to end a really weak week. There is so much bottom calling and bottom wishing, at this juncture it is hard to listen to the financial stations and keep a clear view. That is what makes a follow through to any buying so important. The day to day back and forth action shows the need to have a good day of buying on a reversal, then after that initial move rests, see a return of upside with strength again. That shows that after that initial move buyers want to pick up more stocks. These are usually longer term holders versus the initial short covering moves. Read "The Daily" Entire Weekend Summary Watch Market Overview Video Watch Technical Summary Video Watch Next Session Video
ACAD (Acadia Pharmaceuticals--$21.74; +0.46; optionable): Biotech Company Profile EARNINGS: 11/06/2018 STATUS: ACAD trended lower from October 2017. It sold sharply in April but started to bottom that same month with a double bottom of sorts. As it sold that month, MACD started to rise. ACAD did not follow immediately, however, matching those lows in June, but then fading into August and September with something of a double bottom. MACD continued its improvement, and in the last half of September ACAD shot higher. It cleared the 200 day SMA late September and has spent the time since working laterally along the 200 day. Nice consolidation of the move with ACAD starting to bounce Thursday and Friday. We are looking to move in as the stock continues upside, preferably on some volume. CHART VIDEO Volume: 1.736M Avg Volume: 3.171M BUY POINT: $22.25 Volume=4.6M Target=$26.93 Stop=$20.69 POSITION: ACAD JAN 18 2019 22.00 C - (55 delta) &/or Stock Receive a 2 week trial and if you stay on receive a $30 per month discount! | ||
| 2) STOCK SPLIT REPORT Playing stock splits can be very profitable, but it takes know-how. Our stock split service focuses on three main types of plays: 1) pre-announcement (where we forecast an upcoming split prior to the company making the announcement); 2) pre-split (these plays are made in the days leading up to the actual split day); and 3) post-split plays (plays made after the actual stock split where the stock is showing continued or renewed strength). Listen to Stock Split Report Editor Jon Johnson's stock split interview on CNBC-TV [ View Here ] Here's a leader play and our current analysis.
Company Profile EARNINGS: 11/07/2018 STATUS: FATE is testing the 200 day SMA after breaking higher in the second half of September from a 7 month trading range. Nice rally to 17 to end September. October was not as upside kind and FATE faded back to the 50 day MA midmonth, then sold last week to the 200 day SMA. It held and Thursday bounced on excellent volume. Friday it paused with what is likely a continuation doji. Looks as if FATE has made it through the selling more or less testing its breakout. With the good bounce on volume, we want to move in as FATE continues the upside move with a target near that recent high. Seems logical, yeah verily fate, that it should make that height. CHART VIDEO Volume: 563.567K Avg Volume: 782.433K BUY POINT: $13.82 Volume=1M Target=$16.72 Stop=$12.85 POSITION: FATE FEB 15 2019 12.50 C - (66 delta) &/or Stock Learn more about our Stock Split Report and how we have made gains of 321% with our powerful stock split plays! Save $360 per year on the Stock Split Report! Plus 2 week trial! | ||
FOSL (Fossil--$21.16; -0.26; optionable): Retail stores, watches and accessories Company Profile EARNINGS: 11/06/2018 STATUS: After reaching a high in June, FOSL has trended steadily lower in a rather orderly pullback below the 50 day MA. It finally sold to the 200 day SMA last week, worked laterally, then popped upside Thursday. Friday showed a doji similar to FATE, and it looks as if that is a continuation doji, i.e. the stock will continue higher off this move. We think the pinch between the 200 day on the low and the 50 day MA on the high will yield a breakout move from the current 4.5 month downtrend. We want to play a strong breakout move for a run at the 28 level where the early August peak resides. CHART VIDEO Volume: 1.75M Avg Volume: 1.377M BUY POINT: $22.54 Volume=2M Target=$27.96 Stop=$20.71 POSITION: FOSL JAN 18 2019 22.00 C - (51 delta) &/or Stock Save $600 per year and enjoy a 2 week trial of our IH Alerts Service! | ||
|
--by the MarketFN STG Team WMT (Walmart, Inc.) Company Profile Our Success Trading Group members scored another winning trade this week when we closed out a position in Walmart, Inc. (Ticker: WMT). We are watching several stocks and are looking forward to trading next week. Our Success Trading Group closed 7 years with 0 losses on our Main Trade Table. In fact, we closed 100% winning trades for the calendar years 2016, 2015, 2013, 2012, 2011, 2010 and 2009 (we still have 1 open position from 2017 (all others were winners) and 1 trade that we opened in 2014 was closed as a losing trade). All of these trades are posted on our Main Trade Table for your review during your free membership trial period. Get Our Next Trade Free - Save $50 per month! Details Here. | ||
|
PBR - Petroleo Brasileiro S.A. - Petrobras is currently trading at $16.24. The November $16.00 Calls (PBR20181117C00016000) are trading at $1.29. That provides a return of about 7% if PBR is above $16.00 on expiration Friday in November. Company Profile Learn more about our Covered Call Tables | ||
Stock Split Report: Forbes.com Best of the Web Covered Calls: Allowed in your IRA - Energize your portfolio! The Daily: "The Daily" is a must read for all investors! Success Trading Group: 7 years without a trading loss! | ||
| The foregoing is commentary for informational purposes only. All statements and expressions are the opinions of Online Investment Services, LP., or Split Ventures, Ltd. This information is not meant to be a solicitation or recommendation to buy, sell, or hold securities. We are not licensed or registered in the securities industry. The information presented herein and on the related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolios of writers for this issue may, in some instances, include securities mentioned herein and on the related web site. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors. No one associated herewith receives compensation in any manner from any of the companies that are discussed in this newsletter or on the related websites. This email was sent to tweet@investbilling.com. | ||
|
The Daily, Part 1 of 3, 10-27-18
* * * *
10/27/2018 Investment House Daily
* * * *
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MARKET ALERTS:
Targets hit: None issued
Entry alerts: None issued
Trailing stops: None issued
Stop alerts: None issued
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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
- Earnings disappointments send stocks lower Friday, then a recovery
of sorts.
- Indices hold at the 78% Fibonacci retracement in ABCD patterns.
There is bounce potential . . . as if that is a new story . . .
- GDP solid, consumers solid, business investment not
- Fed remains resolute that all is well even as the top line earnings
misses balloon.
- Some good patterns, some 'name's with interesting setups, but still
no follow through session, not even a real reversal session yet.
- More earnings, tons of economic data this week.
- Even on a bounce of the old leaders or a breakout from good
patterns, it does not appear time to load up the brokerage accounts.
Friday did little to alter the back and forth volatility as AMZN and GOOG
earnings helped the market sell off to new lows on this leg lower. Bids
returned, however, and pushed the indices back above the Wednesday lows.
That turned truly impressive losses to just 1% to 2% declines on the
indices. NASDAQ for instance closed lower 151 points but was off 260+ on
the low. So there was some recovery.
SP500 -46.88, -1.73%
NASDAQ -151.13, -2.07%
DJ30 -296.24, -1.19%
SP400 -1.06%
RUTX -1.10%
SOX -1.72%
NASDAQ 100 -2.34%
VOLUME: NYSE +5%, NASDAQ +7%. Volume up on a selloff but also on a recovery
off the lows to hold the prior low. Decent enough.
ADVANCE/DECLINE: NYSE -2.6:1, NASDAQ -2.2:1. Was a lot worse before the
recovery off the low.
NEW LOWS: NYSE 528, NASDAQ 446. That lower low pushed up the new lows once
more.
There was also, despite the up and down from session to session, a steady
trend lower. Perhaps the selloff was enough to put in a bounce. Perhaps it
was just short covering to end a really weak week. There is so much bottom
calling and bottom wishing, at this juncture it is hard to listen to the
financial stations and keep a clear view.
That is what makes a follow through to any buying so important. The day to
day back and forth action shows the need to have a good day of buying on a
reversal, then after that initial move rests, see a return of upside with
strength again. That shows that after that initial move buyers want to pick
up more stocks. These are usually longer term holders versus the initial
short covering moves.
Of course it takes good patterns to make any rally attempt stick, whether
there is a follow through or not. Right now there are some interesting
upside for certain, but not a lot. The growth areas are in effectively a
bear market. There is interest in biotech/drugs, some retail, some telecom,
food -- not exactly a hit parade of growth, but areas that can make you good
money.
There are also some of the former leaders that have a decent shot at making
a 200 day SMA stand, e.g. CRM, DATA, VRSN, ADBE. Friday VRSN showed a reach
below the 200 day and a recovery on volume. CRM and DATA similar. Perhaps
they can help lead a rebound. If they can continue upside off the 200 day
they are worth putting in a bit of rebound money. These stocks can really
move when oversold, and they are oversold. Don't need a follow through to
play this kind of setup, just need to know it can end as fast as it starts.
You take them for what it is worth at the time: a relief bounce. How do you
play them? If the market surges from Friday, buy some 2 month expiration
options (December works), anticipate a 2 to 3 day bounce, start taking some
or all the gain.
In sum, much of growth is in a bear market, there are still areas receiving
money and in good patterns, some not as clearly defined as they were. We
like several of these areas and are looking at plays there. There are some
patterns in growth that have possibilities. Given the market is too
oversold for downside plays, that means they have a good shot at rebounding.
Those are mentioned above, and if they make a solid move, we look to move
in.
NEWS/ECONOMY
GDP, Q3 first read: 3.5% vs 3.3% exp vs 4.2% Q2
Consumer spending: 4.0%. Accounts for 2.69% of the 3.5% gain.
Inventories: Added 2.07% to the total. Inventories rose at the fastest pace
since 2015, and that boosts GDP.
Imports: subtracted 1.34% from the total because imports are not made in the
USA. BUT, we buy a lot of imports when the consumer feels good. And looking
at the +4% gain in consumption, it is safe to say the consumer felt good in
Q3.
Capital Investment: +0.8% versus +8.7% Q2. Big disappointment.
Solid, but the cap-ex shows the concerns moving ahead. Companies will not
invest if they do not feel the potential return is worth the risk. With the
top line misses showing up (Friday alone added AMZN, GOOG, CL, MCO, EXPE,
MAT, WDC), companies are not selling as much. No investment if the feeling
about the futures is not confident.
The Fed
Fed governor Mester appeared on CNBC Friday and was resolute regarding the
Fed's need to continue hiking. She made the case that while markets are
indeed lower and could pose a 'risk' to the economy overall, this appears to
be normal selling versus any market flaws. She does not see panic,
structural issues, etc.
Okay, that is fine. Markets rise, markets fall. But why? The economy is
going through a softer spot now. The Fed views this as a softer spot in an
otherwise strong economy. Okay, if the Fed was not involved I would not be
concerned. The problem is, the Fed is involved and I and many others have
seen what happens with the Fed: it turns just slowdowns into breakdowns in
the economy.
That is why it was so interesting and indeed refreshing to hear Neil
Kashkari Friday respond to the Fed's actions, stating the Fed should take
its foot off the brake and let people enjoy this economic resurgence. Yes!
That is exactly what I argued the past couple of weeks: we try so hard to
achieve low unemployment and solid economic growth, yet after we get it, the
Fed immediately goes to work on slowing it. In Fed results, that means
ending it. After 10 years of terrible economic performance we finally are
enjoying some fruits of recovery. The 1.5 years of recovery are HARDLY A
REPLACEMENT for the 10 years lost. The average American needs a LOT more
recovery to come anywhere near whole.
THE MARKET
CHARTS
DJ30: Sold lower but recovered to hold inside the recent lows, showing a
doji. This keeps DJ30 at the 78% Fibonacci retracement of the June to early
October rally. Still in the ABCD and that can lead to a rebound. With many
big name growth stocks oversold, that is a definite possibility, even after
all the volatility.
SP500: Very similar action as well, undercutting the prior selloff low,
rebounding to a doji at the 78% Fibonacci retracement. As with DJ30 this is
a pattern that produces rebounds though not new highs. It is a recovery
from an oversold condition.
NASDAQ: A similar pattern of sorts though not as clean an ABCD. It is
holding the 78% Fibonacci retracement of the April to August move. Big
names are oversold, several holding the 200 day SMA as noted earlier. This
pattern is conducive to their rebound as it has held despite all the
volatility.
SP400: Doji after touching a lower low Friday. SP500 is at the February
low. Logical point to try and post a rebound try.
RUTX: Held just over the February low, also showing a doji. As with SP400,
massively oversold and at the February low. That low as significance
because that was the low of the January/February selling that saw VIX spike
to the 50 level.
SOX: Also a lower low, also a doji, this one sitting on top the June 2017
peak. That does not mean a whole lot, but what does is that SOX 160 points
in 8 sessions. It is a bit oversold.
LEADERSHIP
It is hard to say one group is a clear leader. Consumer nondurables that
includes the likes of PG is mixed. PG is solid, CL is not. CLX was good
but gapped down to the 50 day EMA Friday. Perhaps money is gearing up to
come back to the sold off former leaders. As noted, some are set up to
bounce.
Software: CRM, ADBE, DATA, VRSN all have very interesting patterns at the
200 day SMA after some pretty serious selling. These double bottoms,
however, could be the right shoulder, a dipping shoulder, of a head and
shoulders top started in July.
Retail: Not bad in many cases. WMT in the discounters. DG is good though
it gapped lower Friday. ULTA still very solid. TSCO is acting very solid.
FOSL has an interesting pattern. ROST still working on a good pattern.
Biotech/Drugs: Money is moving toward some. ACAD, NVAX. JNJ still solid.
PFE trying to hang on at the 50 day MA. It is a fight.
Telecom: Some are looking solid. Like how VZ is testing a breakout. AUDC
is worth watching as it tests its last strong move as is CIEN.
Food: MCD is testing and could give us an entry as the week progresses. KO
testing some as is PEP after a good recovery move.
MARKET STATS
DJ30
Stats: -296.24 points (-1.19%) to close at 24688.31
Nasdaq
Stats: -151.12 points (-2.06%) to close at 7167.21
Volume: 2.97B (+7.22%)
Up Volume: 748.44M (-1.342B)
Down Volume: 2.21B (+1.558B)
A/D and Hi/Lo: Decliners led 2.12 to 1
Previous Session: Advancers led 2.43 to 1
New Highs: 19 (-3)
New Lows: 446 (+164)
S&P
Stats: -46.88 points (-1.73%) to close at 2658.69 NYSE Volume: 1.124B
(+4.87%)
Up Volume: 280.698M (-3.079B)
Down Volume: 829.137M (-420.863M)
A/D and Hi/Lo: Decliners led 2.6 to 1
Previous Session: Advancers led 2.63 to 1
New Highs: 9 (-2)
New Lows: 528 (+223)
SENTIMENT
VIX: 24.16; -0.06. Punched out 27.52 on the high. That is still below
the early October high even as the indices plumbed new lows. Typically you
have to get that spike in VIX to mean a low is set. This has not been a
spike.
VXN: 29.87; +0.33
VXO: 27.18; +1.80
Put/Call Ratio (CBOE): 1.32; +0.29
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for
them. Stubbornly low are those bears. It is best to see the bulls and bears
converge, the former down, the latter up. They are, but in very slight
moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work,
where does the ammunition to drive the market come from? There is always
new money to start a new year. After that is used will more money be
coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1
versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9
versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5
versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6
versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1
versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5
versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7
versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8
versus 19.6 versus 19.8 versus 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: 3.079% versus 3.126%. Bonds up on the week, yields lower. Not much,
but off the lows.
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.126%
versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779%
versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus
3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061%
versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus
3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99%
versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.14042 versus 1.13757. Euro fading down near the August lows.
Historical: 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus
1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus
1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus
1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus
1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus
1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus
1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus
1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus
1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus
1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 111.89 versus 112.391
Historical: Last below 109 in June 2018: 112.391 versus 112.091 versus
112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus
112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus
113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus
113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus
112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus
112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus
111.064 versus 110.680
Oil: 67.59. Still hanging out at the 200 day SMA after that Tuesday sharp
decline.
Gold: 1235.80, +3.40. On a slow climb up the 10 day EMA.
MONDAY
Earnings continue, likely along with more top line misses. That is the new
old normal of the economy, common from 2008 to 2016, on hiatus, but now
returning as the economy cools off of some relatively hot levels. Recall
that the mantra of many upside analysts pre-earnings was that the results
would rescue the market. They have not done that yet.
There is also a ton of economic data, data that the Fed can look at and if
necessary, ignore. Personal income and spending, consumer confidence, ISM,
construction spending, factory orders, and the October jobs report.
Plenty to digest along with the volatility in the stock market.
As noted before, the stock indices are in position to bounce from the 78%
Fibonacci retracement and ABCD patterns. The volatility suggests a possible
bounce. Oh, there I go again, bottom guessing.
You have to be ready, however. So, we have 'formal' plays on some very
solid patterns, letting others set up a bit more, and also some 'informal'
ones on CRM, VRSN, DATA, ADBE -- if they can produce a bounce we look to
play them for a bounce.
The market is still a volatile day to day episode overall, but perhaps
Friday is an attempt at a reversal that can lead to a bounce that leads to a
follow through and more. If just a bounce, then we play a bounce with those
software stocks and see how the stocks with better patterns react. They may
just work more on their patterns if the others bounce and get money pushed
their way.
With no follow through yet, indeed no reversal attempt yet (okay, perhaps
Friday was), all upside moves are suspect. That is why it is not time to
put the majority of your accounts in new positions, up or down. The indices
are oversold, some big names are at support with decent setups, others have
held well during the selling in very good patterns. Downside is not as good
a probability after the recent selling, and the upside has not proved
itself. If there is a bounce, there is a bounce and we can dabble in it. If
it holds and then posts a follow through, then we can pick up positions
where there are good patterns -- hopefully a lot more good patterns than
now. If not, we get out and then play some downside.
Have a great weekend!
End part 1
_______________________________________________________
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1153 Bergen Pkwy - Suite I #502 - Evergreen, CO 80439
10/27/2018 Investment House Daily
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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
- Earnings disappointments send stocks lower Friday, then a recovery
of sorts.
- Indices hold at the 78% Fibonacci retracement in ABCD patterns.
There is bounce potential . . . as if that is a new story . . .
- GDP solid, consumers solid, business investment not
- Fed remains resolute that all is well even as the top line earnings
misses balloon.
- Some good patterns, some 'name's with interesting setups, but still
no follow through session, not even a real reversal session yet.
- More earnings, tons of economic data this week.
- Even on a bounce of the old leaders or a breakout from good
patterns, it does not appear time to load up the brokerage accounts.
Friday did little to alter the back and forth volatility as AMZN and GOOG
earnings helped the market sell off to new lows on this leg lower. Bids
returned, however, and pushed the indices back above the Wednesday lows.
That turned truly impressive losses to just 1% to 2% declines on the
indices. NASDAQ for instance closed lower 151 points but was off 260+ on
the low. So there was some recovery.
SP500 -46.88, -1.73%
NASDAQ -151.13, -2.07%
DJ30 -296.24, -1.19%
SP400 -1.06%
RUTX -1.10%
SOX -1.72%
NASDAQ 100 -2.34%
VOLUME: NYSE +5%, NASDAQ +7%. Volume up on a selloff but also on a recovery
off the lows to hold the prior low. Decent enough.
ADVANCE/DECLINE: NYSE -2.6:1, NASDAQ -2.2:1. Was a lot worse before the
recovery off the low.
NEW LOWS: NYSE 528, NASDAQ 446. That lower low pushed up the new lows once
more.
There was also, despite the up and down from session to session, a steady
trend lower. Perhaps the selloff was enough to put in a bounce. Perhaps it
was just short covering to end a really weak week. There is so much bottom
calling and bottom wishing, at this juncture it is hard to listen to the
financial stations and keep a clear view.
That is what makes a follow through to any buying so important. The day to
day back and forth action shows the need to have a good day of buying on a
reversal, then after that initial move rests, see a return of upside with
strength again. That shows that after that initial move buyers want to pick
up more stocks. These are usually longer term holders versus the initial
short covering moves.
Of course it takes good patterns to make any rally attempt stick, whether
there is a follow through or not. Right now there are some interesting
upside for certain, but not a lot. The growth areas are in effectively a
bear market. There is interest in biotech/drugs, some retail, some telecom,
food -- not exactly a hit parade of growth, but areas that can make you good
money.
There are also some of the former leaders that have a decent shot at making
a 200 day SMA stand, e.g. CRM, DATA, VRSN, ADBE. Friday VRSN showed a reach
below the 200 day and a recovery on volume. CRM and DATA similar. Perhaps
they can help lead a rebound. If they can continue upside off the 200 day
they are worth putting in a bit of rebound money. These stocks can really
move when oversold, and they are oversold. Don't need a follow through to
play this kind of setup, just need to know it can end as fast as it starts.
You take them for what it is worth at the time: a relief bounce. How do you
play them? If the market surges from Friday, buy some 2 month expiration
options (December works), anticipate a 2 to 3 day bounce, start taking some
or all the gain.
In sum, much of growth is in a bear market, there are still areas receiving
money and in good patterns, some not as clearly defined as they were. We
like several of these areas and are looking at plays there. There are some
patterns in growth that have possibilities. Given the market is too
oversold for downside plays, that means they have a good shot at rebounding.
Those are mentioned above, and if they make a solid move, we look to move
in.
NEWS/ECONOMY
GDP, Q3 first read: 3.5% vs 3.3% exp vs 4.2% Q2
Consumer spending: 4.0%. Accounts for 2.69% of the 3.5% gain.
Inventories: Added 2.07% to the total. Inventories rose at the fastest pace
since 2015, and that boosts GDP.
Imports: subtracted 1.34% from the total because imports are not made in the
USA. BUT, we buy a lot of imports when the consumer feels good. And looking
at the +4% gain in consumption, it is safe to say the consumer felt good in
Q3.
Capital Investment: +0.8% versus +8.7% Q2. Big disappointment.
Solid, but the cap-ex shows the concerns moving ahead. Companies will not
invest if they do not feel the potential return is worth the risk. With the
top line misses showing up (Friday alone added AMZN, GOOG, CL, MCO, EXPE,
MAT, WDC), companies are not selling as much. No investment if the feeling
about the futures is not confident.
The Fed
Fed governor Mester appeared on CNBC Friday and was resolute regarding the
Fed's need to continue hiking. She made the case that while markets are
indeed lower and could pose a 'risk' to the economy overall, this appears to
be normal selling versus any market flaws. She does not see panic,
structural issues, etc.
Okay, that is fine. Markets rise, markets fall. But why? The economy is
going through a softer spot now. The Fed views this as a softer spot in an
otherwise strong economy. Okay, if the Fed was not involved I would not be
concerned. The problem is, the Fed is involved and I and many others have
seen what happens with the Fed: it turns just slowdowns into breakdowns in
the economy.
That is why it was so interesting and indeed refreshing to hear Neil
Kashkari Friday respond to the Fed's actions, stating the Fed should take
its foot off the brake and let people enjoy this economic resurgence. Yes!
That is exactly what I argued the past couple of weeks: we try so hard to
achieve low unemployment and solid economic growth, yet after we get it, the
Fed immediately goes to work on slowing it. In Fed results, that means
ending it. After 10 years of terrible economic performance we finally are
enjoying some fruits of recovery. The 1.5 years of recovery are HARDLY A
REPLACEMENT for the 10 years lost. The average American needs a LOT more
recovery to come anywhere near whole.
THE MARKET
CHARTS
DJ30: Sold lower but recovered to hold inside the recent lows, showing a
doji. This keeps DJ30 at the 78% Fibonacci retracement of the June to early
October rally. Still in the ABCD and that can lead to a rebound. With many
big name growth stocks oversold, that is a definite possibility, even after
all the volatility.
SP500: Very similar action as well, undercutting the prior selloff low,
rebounding to a doji at the 78% Fibonacci retracement. As with DJ30 this is
a pattern that produces rebounds though not new highs. It is a recovery
from an oversold condition.
NASDAQ: A similar pattern of sorts though not as clean an ABCD. It is
holding the 78% Fibonacci retracement of the April to August move. Big
names are oversold, several holding the 200 day SMA as noted earlier. This
pattern is conducive to their rebound as it has held despite all the
volatility.
SP400: Doji after touching a lower low Friday. SP500 is at the February
low. Logical point to try and post a rebound try.
RUTX: Held just over the February low, also showing a doji. As with SP400,
massively oversold and at the February low. That low as significance
because that was the low of the January/February selling that saw VIX spike
to the 50 level.
SOX: Also a lower low, also a doji, this one sitting on top the June 2017
peak. That does not mean a whole lot, but what does is that SOX 160 points
in 8 sessions. It is a bit oversold.
LEADERSHIP
It is hard to say one group is a clear leader. Consumer nondurables that
includes the likes of PG is mixed. PG is solid, CL is not. CLX was good
but gapped down to the 50 day EMA Friday. Perhaps money is gearing up to
come back to the sold off former leaders. As noted, some are set up to
bounce.
Software: CRM, ADBE, DATA, VRSN all have very interesting patterns at the
200 day SMA after some pretty serious selling. These double bottoms,
however, could be the right shoulder, a dipping shoulder, of a head and
shoulders top started in July.
Retail: Not bad in many cases. WMT in the discounters. DG is good though
it gapped lower Friday. ULTA still very solid. TSCO is acting very solid.
FOSL has an interesting pattern. ROST still working on a good pattern.
Biotech/Drugs: Money is moving toward some. ACAD, NVAX. JNJ still solid.
PFE trying to hang on at the 50 day MA. It is a fight.
Telecom: Some are looking solid. Like how VZ is testing a breakout. AUDC
is worth watching as it tests its last strong move as is CIEN.
Food: MCD is testing and could give us an entry as the week progresses. KO
testing some as is PEP after a good recovery move.
MARKET STATS
DJ30
Stats: -296.24 points (-1.19%) to close at 24688.31
Nasdaq
Stats: -151.12 points (-2.06%) to close at 7167.21
Volume: 2.97B (+7.22%)
Up Volume: 748.44M (-1.342B)
Down Volume: 2.21B (+1.558B)
A/D and Hi/Lo: Decliners led 2.12 to 1
Previous Session: Advancers led 2.43 to 1
New Highs: 19 (-3)
New Lows: 446 (+164)
S&P
Stats: -46.88 points (-1.73%) to close at 2658.69 NYSE Volume: 1.124B
(+4.87%)
Up Volume: 280.698M (-3.079B)
Down Volume: 829.137M (-420.863M)
A/D and Hi/Lo: Decliners led 2.6 to 1
Previous Session: Advancers led 2.63 to 1
New Highs: 9 (-2)
New Lows: 528 (+223)
SENTIMENT
VIX: 24.16; -0.06. Punched out 27.52 on the high. That is still below
the early October high even as the indices plumbed new lows. Typically you
have to get that spike in VIX to mean a low is set. This has not been a
spike.
VXN: 29.87; +0.33
VXO: 27.18; +1.80
Put/Call Ratio (CBOE): 1.32; +0.29
Bulls and Bears:
Bulls continued to fall though at a slower pace. Bears almost 'jumped' for
them. Stubbornly low are those bears. It is best to see the bulls and bears
converge, the former down, the latter up. They are, but in very slight
moves.
Bulls: 50.5 versus 51.9
Bears: 19.0 versus 18.3
Theory: When everyone is bullish and has put all their capital to work,
where does the ammunition to drive the market come from? There is always
new money to start a new year. After that is used will more money be
coming? That is the question.
Bulls: 50.5 versus 51.9
51.9 versus 56.3 versus 61.8 versus 60.6 versus 59.0 versus 57.7 versus 60.1
versus 59.6 versus 57.7 versus 57.3 versus 54.9 versus 54.5 versus 54.9
versus 55.3 versus 52.4 versus 47.1 versus 47.6 versus 52.0 versus 55.5
versus 52.9 versus 50.0 versus 49.1 versus 46.6 versus 43.1 versus 43.6
versus 48.0 versus 43.6 versus 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
Bears: 19.0 versus 18.3
18.3 versus 18.5 versus 18.6 versus 18.3 versus 18.1 versus 18.3 versus 18.1
versus 18.3 versus 18.3 versus 18.6 versus 18.8 versus 18.6 versus 18.5
versus 18.5 versus 18.6 versus 18.4 versus 17.6 versus 17.8 versus 17.7
versus 19.2 versus 19.2 versus 19.4 versus 19.4 versus 20.6 versus 20.8
versus 19.6 versus 19.8 versus 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: 3.079% versus 3.126%. Bonds up on the week, yields lower. Not much,
but off the lows.
Historical: the last sub-2% rate was in November 2016 (1.867%). 3.126%
versus 3.111% versus 3.1692% versus 3.20% versus 3.196% versus 3.1779%
versus 3.209% versus 3.165% versus 3.158% versus 3.167% versus 3.146% versus
3.169 versus 3.206% versus 3.233% versus 3.189% versus 3.183% versus 3.061%
versus 3.087% versus 3.061% versus 3.052% versus 3.048% versus 3.048% versus
3.085% versus 3.066% versus 3.068% versus 3.076% versus 3.057% versus 2.99%
versus 3.00% versus 2.972% versus 2.963% versus 2.977% versus 2.937%
EUR/USD: 1.14042 versus 1.13757. Euro fading down near the August lows.
Historical: 1.13757 versus 1.3972 versus 1.14682 versus 1.14626 versus
1.1538 versus 1.14556 versus 1.14961 versus 1.1578 versus 1.15906 versus
1.15592 versus 1.15901 versus 1.15324 versus 1.4966 versus 1.4916 versus
1.1598 versus 1.15164 versus 1.14762 versus 1.15517 versus 1.15774 versus
1.16038 versus 1.16357 versus 1.17501 versus 1.17658 versus 1.17476 versus
1.17486 versus 1.17772 vs 1.16833 versus 1.16692 versus 1.16858 versus
1.16226 versus 1.16900 versus 1.15863 versus 1.16016 versus 1.15946 versus
1.15534 versus 1.16243 versus 1.16341 versus 1.15832 versus 1.16029 versus
1.1664 versus 1.17035 versus 1.1691 versus 1.16802 versus 1.16216 versus
1.15390 versus 1.15709 versus 1.158 versus 1.1487
USD/JPY: 111.89 versus 112.391
Historical: Last below 109 in June 2018: 112.391 versus 112.091 versus
112.427 versus 112.680 versus 112.527 versus 112.385 versus 112.553 versus
112.558 versus 111.848 versus 112.222 versus 112.076 versus 112.158 versus
113.01 versus 113.12 versus 113.706 versus 113.894 versus 114.383 versus
113.642 versus 113.690 versus 112.734 versus 112.981 versus 112.811 versus
112.575 versus 112.448 versus 112.247 versus 112.369 versus 111.849 versus
112.06 versus 111.81 versus 111.491 versus 111.608 versus 111.192 versus
111.064 versus 110.680
Oil: 67.59. Still hanging out at the 200 day SMA after that Tuesday sharp
decline.
Gold: 1235.80, +3.40. On a slow climb up the 10 day EMA.
MONDAY
Earnings continue, likely along with more top line misses. That is the new
old normal of the economy, common from 2008 to 2016, on hiatus, but now
returning as the economy cools off of some relatively hot levels. Recall
that the mantra of many upside analysts pre-earnings was that the results
would rescue the market. They have not done that yet.
There is also a ton of economic data, data that the Fed can look at and if
necessary, ignore. Personal income and spending, consumer confidence, ISM,
construction spending, factory orders, and the October jobs report.
Plenty to digest along with the volatility in the stock market.
As noted before, the stock indices are in position to bounce from the 78%
Fibonacci retracement and ABCD patterns. The volatility suggests a possible
bounce. Oh, there I go again, bottom guessing.
You have to be ready, however. So, we have 'formal' plays on some very
solid patterns, letting others set up a bit more, and also some 'informal'
ones on CRM, VRSN, DATA, ADBE -- if they can produce a bounce we look to
play them for a bounce.
The market is still a volatile day to day episode overall, but perhaps
Friday is an attempt at a reversal that can lead to a bounce that leads to a
follow through and more. If just a bounce, then we play a bounce with those
software stocks and see how the stocks with better patterns react. They may
just work more on their patterns if the others bounce and get money pushed
their way.
With no follow through yet, indeed no reversal attempt yet (okay, perhaps
Friday was), all upside moves are suspect. That is why it is not time to
put the majority of your accounts in new positions, up or down. The indices
are oversold, some big names are at support with decent setups, others have
held well during the selling in very good patterns. Downside is not as good
a probability after the recent selling, and the upside has not proved
itself. If there is a bounce, there is a bounce and we can dabble in it. If
it holds and then posts a follow through, then we can pick up positions
where there are good patterns -- hopefully a lot more good patterns than
now. If not, we get out and then play some downside.
Have a great weekend!
End part 1
_______________________________________________________
Customer Support: http://www.InvestBilling.com
1153 Bergen Pkwy - Suite I #502 - Evergreen, CO 80439
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