Wednesday, November 21, 2018

The Daily, Part 1 of 2, 11-21-18

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11/21/2018 Investment House Daily
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Investment House Daily Subscribers:

Thanksgiving Schedule:

Wednesday: Market summary, play tables

Thursday: Market closed, no report

Friday: Half session, Alerts

Weekend: Market stats, play table update, any decent plays we just cannot resist for the start of the next week.


Targets hit: None issued
Entry alerts: QIWI
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:


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.


- Tuesday reversal continues Wednesday -- for both leaders and growth.
- Oversold enough, indicators skewed enough, growth bounces.
- Existing home sales post largest drop since 2014, housing industry begs the Fed to back off before it crashes housing.
- Durable orders disappoint as does capital investment
- Wednesday bounce not enough to pry open many wallets, at least not very wide open.
- Recent leaders testing, and when they start to rebound that is a much better upside risk/reward.

Okay, there was a bounce. Stocks were oversold enough, the indices having hit their October lows and visions of double bottoms danced in investor's heads. The new lows were strong enough (582). The downside volume lopsided (9:1 downside). Of course there were news stories circulating that the Fed would likely pause in the spring and that Navarro would not accompany Trump to his G20 meeting with China. Thus, a bounce.

SP500 8.04, 0.30%
NASDAQ 63.43, 0.92%
DJ30 -0.95, -0.00%
SP400 1.10%
RUTX 1.31%
SOX 0.42%
NASDAQ 100 0.75%

VOLUME: NYSE -22%, NASDAQ -30%. NYSE trade drops sharply below average, NASDAQ as well. Lower trade on the upside after stronger trade on the downside. That tells the technical story, or a good part of it.


Start of a new move? Could be for a yearend bounce rally as the indices come off potential double bottoms. New highs? Not likely. VIX still quite low. A yearend rally? Could well be, but that will have to show next week because the trade around Thanksgiving is not an indicator of anything.

Money moved into some of the beaten down growth. It moved into some Chinese stocks. It again moved out of some recent leaders such as drugs, retail, utilities, telecom, food (e.g. JNJ, AES, VZ, KO). Something of a short-term rotation if you will from those that worked very well of late to those that have not. PEP, JNJ, KO, VZ, AEP testing near support as DATA, AMZN, GOOG and company bounced from selling. That sizes the action up fairly well.

Small and midcaps you note were the market leaders as oil stocks rebounded modestly along with some biotech stocks. That is nice to see, but neither index did anything to change its current lot.

As for the growth large caps, the moves were just not that impressive to pry open a lot of wallets. Throw in the Thursday holiday and Friday half session, and there was even less reason. Now if they shot higher on strong volume in powerful moves that would have made people think hard about buying; that may still come next week as that would be prime time for a yearend rally to start. With the so-so upside moves and the trade around Thanksgiving being more and more quirky the last few years, again, not many were willing to seriously buy.

We are not convinced Friday will show anything worth putting money at risk. Again, next week will show if breaks higher can shake off the recent heavy weights around the growth areas necks. If so, we can pick up those stocks as they break higher.

Do not forget, however, the leaders to this point, i.e. the food, retail, telecom, drug, utilities -- not a lineup filled with sex appeal, but as I noted in an alert today, sexy in this market is making money, sexy with a twist is making it to the upside. Most of these are down the past day to two days.

That happens OFTEN around Thanksgiving with leaders. They then recovery and move back up with their trend.

Thus, we will look at your basic boring PG, JNJ, AEP, VZ and the like on this pullback, ready for when they start their rebound. Yes, for now we are expecting them to recover after this test period where the other stocks that were clobbered rebound in relief. Then when they are done, the money heads back to the more conservative groups after the oversold condition is worked off.

Not saying growth won't rally to yearend in a traditional yearend rally, but it will have to show it can do so. We are willing to play if they move. DATA, AMAT, MCHP, VRSN and others are not bad, but they need to make convincing moves. If we see the 'boring' JNJ-like stocks start bouncing again, however, we don't need to see much, i.e. not much of a Missouri 'show me' group, to get our money.

We will be here that half-session Friday to see if anything looks as if it can make us money, though not anticipating that to happen. If it does, if PG, JNJ, AXP, VZ, WBA, AEP, MKC bounce then we will be ready to buy and you as well. Keep your eyes on those, and if they break higher starting next week, be ready to jump on them.

Have a great Thanksgiving and weekend!


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Stats: -0.95 points (0.00%) to close at 24464.69

Stats: +63.43 points (+0.92%) to close at 6972.25
Volume: 1.86B (-30.34%)

Up Volume: 1.32B (+543.48M)
Down Volume: 502.4M (-1.368B)

A/D and Hi/Lo: Advancers led 2.88 to 1
Previous Session: Decliners led 3.16 to 1

New Highs: 11 (-2)
New Lows: 112 (-283)

Stats: +8.04 points (+0.30%) to close at 2649.93
NYSE Volume: 774.709M (-22.02%)

Up Volume: 589.248M (+482.319M)
Down Volume: 178.241M (-699.298M)

A/D and Hi/Lo: Advancers led 2.83 to 1
Previous Session: Decliners led 5.43 to 1

New Highs: 17 (-15)
New Lows: 151 (-421)


VIX: 20.80; -1.68. Again, VIX never did break higher this last selloff round, making it hard to feel any serious bottom was put in. A bounce bottom quite likely at most.
VXN: 26.96; -1.81
VXO: 22.48; -1.54

Put/Call Ratio (CBOE): 1.08; +0.16

Bulls and Bears:

Bulls held relatively steady after a serious dive from the low sixties to low forties. Bears actually shrank. Just not a lot of convergence between the two right now to show really bottoming action, BUT bulls have dropped off significantly, and that is some upside impetus.

Bulls: 42.9 versus 42.5

Bears: 19.0 versus 19.8

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

Bulls: 42.9 versus 42.5
42.5 versus 50.5 versus 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 19.8
19.8 versus 19.8 versus 19.0 versus 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


Bonds: 3.065% versus 3.074%. Bonds holding their rebound the past three weeks, still at the 50 day MA, trying to get through.

Historical: the last sub-2% rate was in November 2016 (1.867%). 3.074% versus 3.056% versus 3.065% versus 3.116% versus 3.127% versus 3.147% versus 3.186% versus 3.239% versus 3.228% versus 3.222% versus 3.201% versus 3.22% versus 3.146% versus 3.149% versus 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: 1.13829 versus 1.13700. Hit the 50 day MA, stalled for the past two sessions.

Historical: 1.13818 versus 1.14484 versus 1.14172 versus 1.13308 versus 1.13264 versus 1.13124 versus 1.12348 versus 1.13475 versus 1.1364 versus 1.14329 versus 1.14228 versus 1.14090 versus 1.13881 versus 1.14019 versus 1.13394 versus 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

USD/JPY: 113.007 versus 112.883. Dollar trying to hold and bounce off the 50 day MA again.

Historical: Last below 109 in June 2018: 113.077 versus 112.617 versus 112.831 versus 113.585 versus 113.576. Was at 110 three weeks back.

Oil: 54.49, +1.06. After the Tuesday rip lower, oil rebounded modestly.

Gold: 1226.60, +5.50

End part 1 of 2
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