Tuesday, July 23, 2019

The Daily 7/22

By: Jon Johnson, Editor
Copyright 2015 | All Rights Reserved
Jon Johnson is the Editor of The Daily at InvestmentHouse.com
Technorati tags:

Click Here to register our Free Weekend Newsletter - left column on home page


 * * * *
7/22/2019 Investment House Alerts
* * * *

Alerts Subscribers:

MARKET ALERTS:

Targets hit:  BYND; LRCX
Entry alerts:  CMRX; ETSY; UCTT
Trailing stops:  None issued
Stop alerts:  None issued

******************************
**************************************
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 REPORTS SCHEDULE is as follows:

WEDNESDAY and the WEEKEND reports contain NEW PLAYS, Market Summary Video, Play Videos, and Play Table with play annotations.

MONDAY report will contain a Market Summary Video, new plays, annotated play table.

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 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.

SUMMARY

-       Leading stocks break higher, at least a few of them: chips, FAANG, IPO's
-       Trade talks possibly back on, debt ceiling deal reached, analysts active
-       SOX and NASDAQ trying to lead, DJ30 set up to follow.
-       Earnings are here with the indices tapping the highs. At least the chips are solid.

Monday did not wash away the rather ugly reversal on NASDAQ, NASDAQ 100 and SP500 from expiration Friday, but it certainly helped.  Those indices held where they had to and NASDAQ even looked rather solid.  That solid look no doubt was aided by the strong rebound in semiconductors.  THAT was the move that was the most significant and had a certain amount of 'whew' factor to it.

SOX jumped 1.98%, SMH 2% as big names such as AMAT (6%), INTC (2%), LRCX (4.4%), MU (3.6%) blasted higher on strong volume.  You hate to pin everything on the semiconductors, but they are so important to the overall market that when they make these kind of moves you have to weight upside possibilities more.

Good thing they were strong because everything else, outside of perhaps BYND (+9.85%), was tepid at best.  Indeed, the small and midcaps closed negative.

SP500 9.42, 0.28%
NASDAQ 57.65, 0.71%
Dj30 17.80, 0.07%
SP400 -0.09%
RUTX -0.20%
SOX 1.98%
NASDAQ 100 0.90%

VOLUME:  NYSE -10%, NASDAQ -1%.  Definitely no surge in buying.

ADVANCE/DECLINE:  NYSE -1.2:1, NASDAQ -1.2:1.

New Lows:  NASDAQ posted more new lows (115) than new highs (35) on a day when the index rallied 0.71%.  Darn few NASDAQ stocks were driving that very decent price gain.

As you can see, the market internals were hardly reassuring.  But for the move in chips and a few large techs the market would have floundered.  The rotation seen Friday at expiration that rallied industrial metals, machinery, truckers was not present the day after.  As noted in the weekend report, we saw that happened the prior expiration as well.  Those stocks did not collapse, however, just traded off, pausing if you will, after the solid rallies through Friday.


NEWS/ECONOMY

Trade: Back on the positive side of the ledger as it is said China is showing signs it is interested in restarting the negotiations, e.g. companies applying for tariff exemptions.  It was also reported that Mnuchin and Lighthizer 'could' go to china next week.  Wow.  Only in a market starved for good trade news would that appear to be something really substantive.

Debt deal: The word was out that a debt ceiling deal was closer, and as that is one of the Fed's expressly enumerated 'uncertainties,' of course the market paid attention.  It was not a downside catalyst, apparently, even though you want it to be a question mark if you are pushing for a 50BP rate cut over 25.  Afterhours those reports were confirmed as the White House announced a 2 year 'great deal' had been struck.

Analyst calls:  It didn't hurt that analysts were bullish on stocks, particularly some big names.  Some said AAPL is in good position ahead of its earnings.  Others said nay.  AMZN received 2 upgrades.  MU was upgraded and we saw what the chips did.  It would appear the analysts want to move stocks up ahead of their upcoming earnings. 

That is what we wanted for many plays, i.e. a pre-earnings run.  On the other hand, it is also somewhat exiting there are pullbacks ahead of results.  AMZN, FB, CMG - the fades give a good ramp to jump higher on good earnings results. 


TECHNICAL SUMMARY

CHARTS

As the internals show, basically a few likable and key stocks posted solid moves to paint the tape upside.

SOX:  This was the center of the action with these stocks gapping and rallying once again, some after taking Friday off, some (e.g. MU) taking no time off.  SOX surged past the early July peak as both SOX and SMH approach the late April high, the recovery high from the prior December to late April rally.

NASDAQ:  Friday NASDAQ gapped sharply higher and then reversed sharply.  Monday another upside gap, not as strong, but this one held.  Not a tremendous move, just NASDAQ bouncing off the former all-time highs, holding where it needed to hold and now midrange in the lateral consolidation testing the last breakout to a new high two weeks back.

SP500:  Managed to hold the 20 day EMA with a doji after that Friday gap higher reversed.  Holding where it had to but not much more than that.

DJ30:  The best behaved of the indices on Friday, and Monday the Dow showed a tight doji at the 10 day EMA.  Still in excellent shape as key names start posting their results this week.

SP400:  Lost ground but held the bottom of the 3 week lateral range.  After this kind of consolidation it is setting up for a more definitive move.  Thing is, the midcaps are not leading anyone anywhere.  If the other indices rally well, they likely rally.  Outside of that, there is not a lot of interest in the smaller issues ahead of the FOMC decision.

RUTX:  Russell small caps went a step farther than the midcaps, falling through the 50 day SMA and the bottom of its July lateral range.  As with the midcaps, not much interest in these stocks for now.


LEADERSHIP

Semiconductors: Excellent moves from the big names as noted earlier: LRCX, AMAT, INTC, MU, AVGO, TSM.  Others moved solidly as well: MCHP, XLNX.  INTC earnings are Thursday after the close.  SLAB, XLNX are Wednesday. 

IPO:  Once again the IPO's were in vogue.  BYND surged over 10% on the high with a new breakout.  TTD jumped back up on strong volume.  WORK surged 6+%, but that is after it dropped 4 points over the prior 3 sessions.  ZM and DBX are in excellent position to break higher once again. 

FAANG:  Lots of talk about these stocks as FB (Wednesday) AMZN, GOOG (Thursday) approach earnings.  AAPL is rising some though its results are farther off while FB and AMZN have a good pullback to rally from on the results.  NFLX is in purgatory.

Retail:  BBY posted a second session upside after the Thursday doji at the 10 day EMA.  Many other leaders in the group are still testing, e.g. HD, TJX, COST.

Industrial metals: Mostly faded after the Friday surge.  AKS, STLD were higher but barely.  Same with RS, FCX.  CLF, MUX tested a bit more.  Nothing bad, more like a day off.

Machinery:  Another group that paused after a break higher Friday: CMI, DE.  MTW gapped higher faded to flat.  All in all, still good setups.

Transports:  Truckers took a pause after good moves, e.g. JBHT, KNX.  Airlines not bad as SAVE starts higher, LUV still decent - but afterhours we learned the 737 MAX won't be flying until at least November 3. 

Food/restaurants:  YUM, MCD started higher after a Friday fade.  CMG still struggling ahead of its Tuesday earnings, managing a doji at the 20 day EMA.

MARKET STATS

DJ30
Stats: +17.70 points (+0.07%) to close at 27171.90

Nasdaq
Stats: +57.65 points (+0.71%) to close at 8204.14
Volume: 1.843B  (-1%) 

Up Volume: 1.059B  (+346.215M) 
Down Volume: 749.041M  (-361.138M) 

A/D and Hi/Lo: Decliners led 1.17 to 1
Previous Session: Decliners led 1.51 to 1

New Highs: 69  (-36) 
New Lows: 115  (+35) 

S&P
Stats: +8.42 points (+0.28%) to close at 2985.03
NYSE Volume: 716.866M  (-9.67%) 

Up Volume: 341.753M  (+47.04M) 
Down Volume: 358.221M  (-119.731M) 

A/D and Hi/Lo: Decliners led 1.15 to 1
Previous Session: Decliners led 1.32 to 1

New Highs: 125  (-67) 
New Lows: 74  (+10)


SENTIMENT

Sentiment is a contrary indicator.  In other words, if investors are so confident a move has to go on, that is when sentiment indicators come into play.  Sentiment represents investor emotion whether exuberance or fear.  Most of the time it is in the background and doesn't give much insight into market moves.  At extremes, however, it can foreshadow direction changes.  Too greedy and the market is near a top.  Too fearful and a bottom can be forming.  If everyone is so confident the market will move higher, all the money is in the market and nothing is there to drive it higher.

A caveat:  Do not fall in love with one sentiment indicator.  They all need to fall into line.  That gives you an indication of a change in the mix.  It is a warning flag to watch for breakout reversals, slowing momentum in the upside moves (weaker volume, lower MACD highs as stocks make new highs).  It gets you ready, then the leadership action and index price/volume action confirms what the sentiment suggested.

VOLATILITY

VIX:  13.53;  -0.92
VXN:  17.07;  -0.62
VXO:  13.07;  -1.45

Perhaps a bit low but volatility can stay low for a long, long time and stocks keep rising.

Volatility typically rises when investors are on edge, falls when they are complacent.  High levels (typically 30+) indicate a change in direction could be approaching and typically accompany a market that has rallied well.  10 or less suggests investors take for granted market moves upside and you can start seeing the upside moves falter with the moves showing a wider range with gaps back and forth. 


PUT/CALL RATIO

Put/Call Ratio (CBOE):  0.99;  -0.10.  One close over 1.0 on Friday, two 0.99 readings in the last four sessions.


The general market bias is bullish.  We are an optimistic people and our system of commerce historically produces economic growth.  Thus more calls than puts are the norm in day to day trading.  When put buying starts to overtake call buying, however, that suggests fear or downside speculation has overcome that normal upside bias.  When that happens, given the usual upside bias, that suggests a rally is nearing the peak.  It typically takes several closes over 1.0 in relatively close proximity to provide a solid signal.



Bulls and Bears: 

Bulls move to 58.0, close to the 60 level where the market typically starts to struggle.  While bulls are moving slowly higher, bears dropped a sharp 1.5 points.  This is in line with the bulls rising and further indicates the market is approaching an exuberance level that can lead to choppy trade and selling.

Indicator level: Yellow.  Moving closer to the 60 level that represents points where the market starts to struggle, but still holding the range for now.

Bulls: 58.0 versus 56.7

Bears:  16.8 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.


OTHER MARKETS

INTEREST RATES

Threat level:  Tinged red.  3 month/10 year spread remains inverted, but barely.  The 2 year is still below the 10 year but the spread is expanding.  The 5 year is back over the 2 year yield.  Third 10 year/3 month inversion this year.  The positive: the 2 year/10 year is not inverted and the narrow spread had, well, spread out.

The 3 month yield versus the 10 year: Spread climbed 2BP to -3BP.   Almost curing the inversion.  Of course, the next step is to widen the spread in favor of the 10 year.

The 2 year versus the 10 year: Spread fell 4BP to 23BP. 

10 year:  2.046% versus 2.05%

3 month:  2.076% versus 2.069%
2 year: 1.1816 versus 1.1818

Historical: The 10 year is holding over 2% the past two weeks after the drop during the July 4 week.  Those were the first sub-2% levels since November 2016 (1.867%). Last trade over 3% was November 2018.  2.6% for quite some time, then yields started higher, first run from November to January, then mid-March.


The Dollar:  There are two schools of thought.  First, those who believe a strong dollar is in the interest of the US.  Reagan (though not all of his advisors) and Clinton were strong dollar Presidents.  Second, there are those who believe a strong dollar prevents the US from selling US goods abroad.  The Bushes (1 and 2) and Obama were in this category.  The thing is, the US is always its economic strength peak when its consumers are consuming, and that is when there is a strong economy and a strong dollar: they consume both US and foreign goods.  History shows this again and again, and thus it is worth watching the dollar as a gauge of how the US economy is performing.

EUR/USD:  1.12080 versus 1.12211.  Still holding over the 1.120 support level.

Historical: Back into the 6-month range formed after the euro sold off from the early 2018 peaks after a week below it.


USD/JPY:  107.912 versus 107.717

Historical: Last below 109 in June 2018 then tumbled to 107 in early January 2019.


Oil:  56.22, +0.46.  Moving up to tap at the 50 day MA's, showing a doji.  Oil did not really surge even with the Iran action against UK tankers.


Gold:  1426.90, +0.20.  Still holding over the 10 day EMA even after that big upside gap and reversal. 


TUESDAY

Earnings will now get serious with KO, UTX before the Tuesday open, V, SNAP, CMG after.  Then CAT, SLAB, FB, XLNX Wednesday, AMZN, GOOG, INTC, VRSN Thursday after the close.

The rebound in chips and IPO's was encouraging - still buyers out there.  There are some pullbacks in big names heading into their results.  They are primed for more buying if the results are good. 

That is what it comes down to - as it should - earnings results telling the story.  The indices are flirting at new highs again, and that means the results need to be solid to keep them moving.

At the same time there are those stocks that rallied Friday that are not near new highs but have nice bottoming patterns, turning upside.  If the big names stumble some the money has shown it can go to those stocks.  Kind of an earnings failsafe.

Don't forget the Fed.  Even with the strange case of the Fed's Jekyll and Hyde performance last week (50BP preemptive rate cut/no preemptive action), the Fed is still there in a dovish bent.  Indeed, the President kept the pressure up today, pushing for cuts, stating other countries had much easier money policies.  He gets the last word, at least until the FOMC decision, as the Fed is now in its quiet period.

Took some solid gain today on BYND, LRCX, and frankly are looking at new plays because the setups remain solid in both the current leaders and those setting up to try and be leaders.

Have a great evening!

End part 1

CONTINUING PLAY TABLES

You can view the continuing play table in three different formats.

1.  Text (below)
2.  HTML (use the following link)
3.  Spreadsheet download


* * * * * * HTML CONTINUING PLAY TABLE * * * * * *

HTML CONTINUING PLAY TABLE.  This is a service to our subscribers only, and no other use of the information is authorized.  Simply click on the link, enter your username and password, and download the Continuing Play Table in HTML format that includes additional information, e.g. option tickers, after hours pricing:

https://investmenthouse.com/daily/DailyTable.htm

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


* * * * * * * SPREADSHEET DOWNLOAD * * * * * * *

The following link is to a spreadsheet download of the continuing play table.  It will allow subscribers to sort the data for your personal investment use.  This is a service to our subscribers only, and no other use of the information is authorized.  Simply click on the link, enter your username and password, and download the spreadsheet.

https://investmenthouse.com/daily/table.php

You will need your password. If you need help click on this link and our automated system will email it to you immediately once you fill in your email address:

https://www.investmenthouse.com/rescue/rescue.php3



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

LEGEND FOR CONTINUING PLAY TABLE

DATE: date play first appeared on report.

PLAY: Denotes the type of pattern or play. 
Upside play types:  Asc Tri=Ascending triangle; BO=Breakout; Cup=Cup base; Cup hdl=Cup w/handle; DB hdl=Double bottom w/handle; Dbl btm=Double bottom; Flat=Flat base; FlyPlat=Flying Plateau; Pennant=Pennant; Rv H&S=Reverse head & shoulders; Saucer=Saucer base; Test 18=Testing 18 day MVA; Test 50=Testing 50 day MVA; Test BO=Testing the breakout (could be 10 day MVA test, etc.) Downside play types:  CCall=Covered Call; Dsc Tri=Descending triangle; Dbl Top=Double top; H&S=Head & shoulders; Put (generic downside);

PIVOT=Buy point

Tgt=Target stock price for the play. Applies to stock and options.

Vol=Volume for the most recent session.

TgtV=Target volume to enter the play.

Stop=Stop advisory point. This is advisory and we may or may not exit a play if it hits this level depending upon Market conditions.

PLAY STATUS:  Buy not hit (stock has not hit buy point); Buy not issued (stock has hit buy point but did not enter due to weak volume, poor intraday action, poor Market action); Current (ongoing play already entered); Entered today (entered the play that session); Exited (closed the position); Target hit (play hit initial target; will note if took all or partial gain or let run further); Trailing stop (exited using a trailing stop loss).

Upside Plays
Stock Date   Play     Close   +/-     Pivot   Tgt     Vol   TgtV  Stop
AAOI  07/09  Trnd Rv  9.09    -0.52   10.12   12.57   789K  725K  9.59 
     Buy Not Issued. Dropping.

AAPL  06/24  Cup hdl  207.22  +4.63   204.00  215.98  22M   30M   201.43
     Current.

AKS   07/17  Rev HS   2.42    0.00    2.43    2.85    10M   10M   2.26 
     Current.

AMAT  07/17  Rev HS   50.73   +2.91   47.82   52.56   21M   12M   49.09
     Current. Surging toward the initial target.

AMD   07/15  Cup hdl  32.85   +0.34   33.71   38.98   37M   70M   32.38
     Buy Not Issued.

AMZN  06/12  Flag     1985.6  +21.11  1863.8  1960.0  2.8M  5M    1995.7

ARNA  05/24  Test BO  62.29   +0.46   55.94   61.54   354K  725K  60.42
     Current.

ARQL  07/22  Flag     10.91   +0.34   10.98   13.88   1.1M  5M    10.41
     Buy Not Hit. New play.

AVGO  07/13  Triangl  296.15  +6.14   289.18  300.09  3.3M  4.2M  286.13
     Current.

AXSM  07/22  Test 50  26.31   +1.46   26.49   30.44   1M    1.4M  25.18
     Buy Not Hit. New play.

BBY   06/29  Rev HS   75.70   +0.99   73.29   78.84   2.9M  3.6M  73.97
     Current.

BYND  07/10  Triangl  194.20  +17.41  169.53  184.94  11M   6M    184.94
     Target Hit. Banked half the solid gain as BYND surged. Left half to keep working as it moved hard on strong volume.

CAT   07/13  Rev HS   135.24  -0.98   137.08  143.57  3M    4.5M  134.94
     Buy Not Issued.

CMG   07/15  Flat     742.51  -4.00   762.65  799.98  446K  465K  746.93
     Current.

CMI   07/19  Cup hdl  170.73  -2.07   172.96  182.04  937K  1.5M  169.96
     Buy Not Issued.

CMRX  07/19  Test 50  3.63    -0.06   3.74    4.49    109K  500K  3.48 
     Entered today.

CRM   07/10  Flat     157.70  +0.94   158.44  165.49  2.9M  6.2M  155.94
     Current.

CUTR  06/22  Trnd Rv  24.24   +0.11   21.75   24.48   37K   155K  24.48
     Current.

CYBR  07/19  Flag     142.01  +2.54   142.12  152.24  577K  1.1M  138.79
     Buy Not Issued.

DBX   07/19  Test 50  24.40   -0.02   25.02   28.83   0     5M    23.75
     Buy Not Hit.

DIS   06/03  Pennant  140.84  +0.99   134.53  142.32  7.3M  15M   139.77
     Current.

DOW   07/19  DB hdl   50.88   -0.64   52.05   57.00   2.8M  5.6M  50.39
     Buy Not Hit.

ETSY  07/15  Triangl  68.53   +2.68   68.54   74.94   2.1M  3.4M  65.68
     Entered today.

FB    06/19  Test BO  202.32  +3.95   189.43  199.98  13M   24M   196.89
     Current.

FSLR  07/06  Cup hdl  66.59   +0.06   67.39   77.68   811K  1.4M  64.54
     Current.

GOOG  07/06  Trnd Rv  1138.0  +7.97   1140.6  1214.8  1.2M  16    1133.2
     Current.

GRUB  06/15  Cup      73.91   -1.44   76.58   82.44   1.1M  4.2M  75.45
     Buy Not Issued.

GS    07/19  Rev HS   214.00  +0.47   216.03  228.00  1.7M  3M    212.03
     Buy Not Hit.

INTC  05/29  Rolling  51.35   +1.08   46.89   51.81   20M   30M   49.47

ISRG  06/29  Cup hdl  535.50  +6.69   537.24  559.98  638K  1M    523.09
     Current.

JPM   07/09  Cup hdl  114.27  +0.72   114.15  117.00  8.4M  13M   113.84
     Current.

KO    06/03  DB hdl   51.22   -0.17   51.21   53.11   11M   14M   51.11
     Current. Earnings out before the open.

LRCX  06/29  Cup      207.21  +8.74   191.21  207.78  2.3M  2.1M  202.43
     Target Hit. Took half the gain as LRCX surged to the target.

LYV   07/01  Flag     70.04   -0.25   67.63   71.54   800K  1.6M  69.36
     Current.

MCHP  07/06  Cup hdl  93.56   +1.25   91.71   99.98   1.5M  2.8M  89.89
     Current.

MDR   07/17  Cup hdl  10.40   -0.02   10.59   12.64   2.5M  5.5M  9.95 
     Buy Not Issued.

MTCH  05/22  Flag     76.79   +0.77   73.10   79.65   1.2M  2.7M  72.08
     Current.

MTW   07/19  Rev HS   17.40   -0.03   17.62   21.24   126K  450K  16.41
     Buy Not Hit.

MU    07/08  Flag     47.19   +1.66   40.81   44.24   46M   28M   45.12
     Current.

MXL   07/08  Cup hdl  24.90   +0.09   24.48   28.24   331K  550K  24.23
     Current.

NSC   07/15  Flat     196.30  +1.11   207.32  213.48  1.4M  1.6M  202.76
     Current.

NVDA  07/06  Flag     171.30  +2.86   164.43  174.05  7.4M  12M   161.02
     Current.

OC    07/13  Test BO  54.68   -0.57   56.36   61.46   1.3M  1.8M  54.78
     Current. Earnings before the open WED and OC needs some earnings to jump it higher as it has formed an interesting ABCD pattern ripe to move higher.

PLMR  07/19  BO       26.39   -0.05   26.61   29.96   80K   200K  25.48
     Buy Not Issued.

RUN   06/29  Pennant  19.89   +0.12   19.53   21.85   1.1M  2M    18.87
     Current.

SIMO  06/22  Rev HS   41.19   +0.03   42.67   46.98   225K  355K  41.49
     Buy Not Issued.

SLAB  07/06  Cup hdl  105.22  +1.20   106.05  114.98  188K  275K  102.94
     Current.

SNAP  06/25  Flag     14.15   +0.13   15.22   16.97   26M   30M   14.84
     Current.

SNAP  05/28  Cup hdl  14.15   +0.13   11.95   14.12   26M   35M   14.87
     Current.

SPOT  07/10  Test 20  146.81  +2.69   154.20  165.98  0     2M    146.63
     Current.

STLD  06/25  Cup hdl  31.54   +0.07   30.61   34.92   2.9M  2.6M  29.43
     Current.

STX   07/13  Rev HS   47.37   +0.07   48.27   52.99   1.8M  3.4M  46.28
     Current.

TTD   07/22  Test 50  249.03  +13.72  249.71  279.94  1.4M  2M    239.82
     Buy Not Hit. New play.

TTWO  06/15  Cup      116.66  +0.59   113.87  120.56  691K  2.6M  114.38
     Current.

TWLO  07/06  Test 50  147.46  +1.84   143.91  154.98  3.4M  5.4M  139.89
     Current.

TWTR  04/18  DB hdl   37.58   +0.80   38.44   42.45   8.3M  12M   36.34
     Current.

UCTT  07/13  Triangl  14.20   +0.31   14.32   16.49   814K  650K  13.43
     Entered today.

UTX   07/13  Rev HS   132.95  +0.56   133.84  138.79  2.9M  5M    132.18
     Buy Not Hit.

V     06/15  Flag     180.57  +1.32   173.31  179.25  4.8M  8M    177.64
     Current. Earnings after the Tuesday close. Looks good, have taken some gain on it. Consumer is strong. Can take some more gain then let the rest work into the earnings.

VRSN  12/26  Test 20  215.94  +1.72   146.89  159.78  819K  1.1M  211.91
     Current.

WDAY  07/17  Test 50  214.34  +0.09   218.32  230.00  948K  2.2M  214.32
     Buy Not Issued.

XLNX  06/19  Dbl btm  124.23  +1.53   120.15  133.97  2M    5M    118.71
     Current.

Z     07/18  Flag     47.40   +0.33   48.67   53.72   2.1M  3M    46.98
     Buy Not Issued.

ZM    07/15  Cup      96.67   +3.29   97.81   115.00  1.5M  3M    93.22
     Buy Not Issued. Looks ready to move.

ZS    06/08  Test 50  83.98   +1.30   77.29   84.85   0     2.8M  80.26
     Current.

End part 2

Begin part 3 of 3

NEW PLAYS

Upside:

Play Date: 07/22/2019
ARQL (Arqule--$10.91; +0.34; optionable):  Biotech
EARNINGS: 07/31/2019
STATUS:  Flag.  Nice breakout gap in mid-June took ARQL out of a 12 month base,  Strong breakout and rally into early July.  Great run, needed a rest.  The past 2+ weeks ARQL is testing the move. Coming back to the 20 day EMA and holding easily over the 38% Fibonacci retracement.  Started upside Monday though volume was light.  Looking to move in as ARQL continues this break, preferably with more volume.  A move to the target gains a solid 25%ish on the stock, 95%ish on the call options.
Volume: 1.099M  Avg Volume: 4.55M
BUY POINT: $10.98 Volume=5M Target=$13.88 Stop=$10.41
POSITION:  ARQL SEP 20 2019 10.00C - (68 delta) &/or Stock
https://investmenthouse1.com/ihmedia/f/charts/arql.jpg

Play Date: 07/22/2019
AXSM (Axsome Therapeutics--$26.31; +1.46; optionable)
EARNINGS: 08/07/2019
STATUS:  Looking to play AXSM again after a new high in early July is tested back to the 50 day MA to end last week.  Monday a break higher off the 50 day test, showing solid shot of volume.  Nice test and good bounce from a leader.  As ARQL continues the move we want to move in.  A rally to the target gains 15% on the stock, 55%ish on the options. 
Volume: 1.019M  Avg Volume: 1.128M
BUY POINT: $26.49 Volume=1.4M Target=$30.44 Stop=$25.18
POSITION:  AXSM SEP 20 2019 25.00C - (64 delta) &/or Stock
https://investmenthouse1.com/ihmedia/f/charts/axsm.jpg

Play Date: 07/22/2019
TTD (The Trade Desk--$249.03; +13.72; optionable)
EARNINGS: 08/08/2019
STATUS:  TTD is coming off the 50 day EMA test from last Thursday, showing strong volume on the Thursday tap of that support.  Strong volume again Monday as TTD rallied to last week's highs.  Forming the point in a 2-month triangle and showing good volume on the buy side.  This is one of those IPO stocks, and as TTD breaks higher through the buy point we are ready to enter.  A move to the target gains 60%ish on the options, 12% on the stock.
Volume: 1.441M  Avg Volume: 1.414M
BUY POINT: $249.71 Volume=2M Target=$279.94 Stop=$239.82
POSITION:  TTD SEP 20 2019 250.00C - (54 delta) &/or Stock
https://investmenthouse1.com/ihmedia/f/charts/ttd.jpg



Good Investing!
Jon L. Johnson and The Daily Staff

All of the foregoing is commentary for informational purposes only. All statements and expressions are the opinion of Online Investment Services, LP or its paid consultants and are 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 our related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolio of Partners of Online Investment Services, LP or its paid consultants may, in some instances, include securities mentioned herein and on our 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.


Monday, July 22, 2019

Weekend Issue for 7/21



THE WEEKEND ISSUE
Informing Investors Around The World
Read In All 50 States And Over 100 Countries
 You have earned ~~VIP~~ points worth $~~VIP~~ Click here for details* 

Weekend Newsletter for July 21, 2019


Table Of Contents

1) MARKET SUMMARY from THE DAILY

2) STOCK SPLIT REPORT

3) IH ALERTS

4) SUCCESS TRADING GROUP

5) COVERED CALL SERVICE

Jon Johnson

1) MARKET SUMMARY:
Excerpted from Thursday's paid content of "The Daily" by Jon Johnson at InvestmentHouse.com. To get his latest information and his daily content, click here now to receive a two-week trial and save $30/month. (You won't find this offer on the Investment House website. It is exclusively for The Weekender subscribers!)

Earnings Reporting Season Has Begun.

  • Due to disappointing earnings, stocks start low and then put in a low to high move.
  • The pullback may be ending as the chip stocks continue to lead the rest of the market.
  • Semiconductor stocks post some very good moves off some very good patterns.
  • The VanEck Vectors Semiconductor ETF (SMH) clears the "trade truce" high, an important milestone.


Market Summary (continued from above)

The economic outlook continues to be muddy.

At the same time, however, a trade deal with China appears remote, regardless of what JPMorgan Chase thinks. Indeed, after President Trump’s comments on Wednesday about a deal being a long ways off, Treasury Secretary Mnuchin said that they were having a telephone conference on Thursday as “complicated issues” remain. These were the "uncertainties" that Fed Chairman Jerome Powell discussed in his congressional testimony.

The Fed had something to say as well. New York Fed President John Williams continued the Fed's dovish bias by noting that it was better to take "preemptive measures" than suffer the consequences of waiting too long to act. He also discussed the virtues of ZIRP, that is, zero interest rate policy. Okay, that sounds dovish.

DJ30: The DJ30 had a nice doji and a tail test of the 10-day exponential moving average (EMA). Also, its break held over the prior highs even on the low. It also helped that there was a nice action in setting up a rebound as Boeing (BA) was up afterhours due to its management's desire to compensate airlines that have suffered financially as a result of the recent 737 MAX crashes. Microsoft (MSFT) also moved up nicely afterhours due to its strong earnings.

S&P 400: The S&P 400 gapped lower, undercut the two-and-a-half week lateral range and then reversed to hold it. Perhaps this was the final shakeout of the weaker holders in the lateral consolidation. While the table is set, will any buyers come to eat?

NASDAQ: The NASDAQ gapped lower to the August 2018 high, tested it and then moved higher on a good shot of trading volume that was finally back above average. This course of events showed that buyers came in on the dip. Meanwhile, the up/down volume was significantly stronger as it tested the early July peak that is coincident with the April/May peaks. This was a good series of actions that were aided, of course, by the chip stocks.

SOX: The Philadelphia Semiconductor Index (SOX) broke higher to a new recovery high, even though it did not take out the high that it achieved during the "trade truce" on Monday. At the same time, there was also some good action amid the large-cap chips.

NOTE: The figures and information above are from the 7/18 report.

Watch Market Overview Video

Watch Technical Summary Video

Watch Next Session Video

NOTE: The videos are from the 7/18 report.

Here are two trades from "The Daily" and insights into our trading strategy:

Chart by StockCharts.com
MCD (NYSE: McDonald's Corp.)

Company Profile

We had some July call options left on MCD from a position that we entered in early June. Since the price of MCD shares was rising all of July, we decided to let the remaining half of the position continue to work as long as the upside pace was steady.

We bought the calls on 6/6 for $6.40 as MCD had rallied to $215 on the previous Thursday and then faded. This week, MCD rallied and, once again, found resistance at $215. On Tuesday, it hit that level yet again and then stalled.

That was it for us. Since the calls would expire this week, we sold the last of our MCD calls for $13.80 and banked 115%. Of course, MCD shares jumped to a new high on Thursday. Oh well.

AXP (NYSE: American Express Co.)

Company Profile


Chart by StockCharts.com
We like to play the credit services companies -- credit card companies to be more precise -- when they set up at the short-term moving averages in preparation for the next run. Last week, I discussed our most recent play on Visa (V) and we also entered a play on AXP. AXP reached a higher high in mid-June and then tested back to the 10-day EMA. Since AXP had just come off a 50-day EMA test, it likely has four to five rallies off the 10- or 20-day EMA before it tests deeper. In fact, we saw it start up off the 10-day EMA in early July. Thus, we were ready.

On July 3, we moved in with some options to play the bounce and bought some August $125.00 calls at $2.88. AXP held at the 10-day EMA for three sessions after we bought these calls and then it broke upside with a slow rise into this week. On Tuesday, its sixth upside session off the 10-day EMA test, AXP gapped to a higher high. Then, it started to back off.

That was about all the days it seemed like it would get on these moves, and with the indices looking as if they were going to test the last leg higher, it was time to bank the gains. We sold the calls for $4.00 and banked 38%. On Wednesday, AXP continued to test. On Thursday, it opened lower but recovered. While we may need to start a new play, we would prefer a bit more of a test.

Receive a two week trial and if you stay on receive a $30 per month discount!

2) STOCK SPLIT REPORT

Here's a leader play and our current analysis.

Chart by StockCharts.com
NASDAQ:AMAT (Applied Materials Inc. -- $46.22; +0.21; optionable): Chip equipment
Company Profile

EARNINGS: 08/15/2019

STATUS: AMAT is in a big base from its March 2018 high. Over the past 13 months, its trajectory has formed a large inverted head and shoulders pattern. Then, over the last three months, AMAT formed the right shoulder by using the 200-day SMA as support. After a move higher over the past two weeks, AMAT is testing this week and holding over the 10-day EMA. If AMAT can make a break on some volume, we want to move in. A rally to the target will give us around 13% on the stock and around 120% on the options.

VOLUME: 8.347M Avg Volume: 9.527M

BUY POINT: $46.55 Volume=12M Target=$52.56 Stop=$44.723

POSITION: AMAT SEP 20 2019 46.00C -- (54 delta) &/or Stock

CHART IMAGE

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 a two week trial!

Chart by StockCharts.com

3) IH ALERTS

NYSE:CMG CMG (Chipotle Mexican Grill--$759.87; +9.01; optionable)

Company Profile

EARNINGS: 07/23/2019

STATUS: CMG is breaking higher from a five-week lateral consolidation. It began to show strong volume when it started stirring on Friday and then broke higher on Monday. As its earnings will be released next week, we want to play a rally towards the earnings and likely part of the position as well. A move to the initial target will give us around 60% on the options.

VOLUME: 461.818K Avg Volume: 449.289K

BUY POINT: $760.21 Volume=465K Target=$799.98 Stop=$746.93

POSITION: CMG AUG 16 2019 760.00C -- (52 delta)

CHART IMAGE

Save $600 per year and enjoy a two week trial of our IH Alerts Service!

Chart by StockCharts.com

4) SUCCESS TRADING GROUP

-- by the MarketFN STG Team


NASDAQ:RUN (Sunrun Inc.)

Company Profile

Our Success Trading Group members scored another winning trade this week when we closed out a position in Sunrun Inc. (NYSE:RUN). We are watching other several stocks and are looking forward to trading next week.

Our Success Trading Group closed seven years with zero 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 one open position from 2017 (all others were winners) and one trade that we opened in 2014 but 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.

Chart by StockCharts.com

5) COVERED CALL PLAY

NASDAQ:NEPT -- Neptune Technologies & Bioresources Inc. is currently trading at $5.17. The August 17 $6.00 Calls (NEPT20190817C00006000) are trading at $0.45. That provides a return of about 9% if NEPT is above $6.00 by the time of the expiration.

Company Profile

Learn more about our Covered Call Tables
PREMIUM SERVICES
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 is a commerical email. It may contain advertisment or solicitation. This email was sent to ~~EMAIL~~. Please click the following link to change or unsubscribe. All Rights Reserved. 300 New Jersey Ave, Suite #500, Washington, DC 20001


NOTE: You have ~~VIP~~ VIP Points!

* Each VIP Point is worth $1 off the price of any of our monthly subscription newsletters!

Monday, June 10, 2019

The Daily, Part 1, 6-10-19

* * * *
6/10/2019 Investment House Daily
* * * *

Investment House Daily Subscribers:

MARKET ALERTS:

Targets hit: DE
Entry alerts: CRON; MTCH
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 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.

SUMMARY

- Mexican tariffs officially put off, Fed still behind the market, stocks continue the rebound to start the week.
- NASDAQ and SOX lead the move as some software M&A gets investors excited.
- Stocks gap and rally, but give up a good part of the move, showing tombstone doji.
- Market ripe for a test of the move. The Fed has potentially shifted the bias so on a pullback you watch for a change in the patterns.

Stocks again found more upside as the stories leading to the selling continued to peel back. Tariffs against Mexico are off and the Fed said nothing to take back the notion the next move will be a cut, a cut in the near future.

On top of that, M&A was back on and that always gins up investors. UTX and RTN want to merge into the largest defense company. CRM is buying DATA, exciting a sector already leading the market.

Those two catalysts certainly did not get in the way of the bullish upside. Stocks were up premarket and rallied at the bell. Solid moves to midday as the stock indices put in the fifth or sixth session upside, depending upon the index.

SP500 13.39, 0.47%
NASDAQ 81.07, 1.05%
DJ30 78.74, 0.30%
SP400 0.54%
RUTX 0.61%
SOX 2.54%
NASDAQ 100 1.14%

VOLUME: NYSE +2%, NASDAQ 2%. Finally some upside volume on an upside session. Still below average, however, so no big move.

ADVANCE/DECLINE: NYSE 3:2, NASDAQ 1.8:1. Hardly inspiring.

An impressive string to the upside continues. After hitting the session highs, however, the indices peeled back the gains. SP500 and DJ30 gave up more off the high than what they held as gains as the close. NASDAQ, SP400, RUTX showed similar action. SOX managed to hold on decently enough, however, as it broke through the 50 day EMA. Always good for the market when the chips perform well.

It was another case of the indices moving to next resistance. Each move higher off the early June low seemed to put the indices at next resistance - that is what happens when you sell off, i.e. you have to move back up through that resistance. Thus far they are shooting them down.

Now you have the next level with the indices most all sporting doji.

CHARTS

Over the weekend I threw out the possibility the indices test this move higher with a higher low at the necklines of the head and shoulders patterns, thus morphing into inverted head and shoulders patterns, an upside setup. The big top is still in place, but if the Fed is going to support the markets then the potential to rally on top of this rally is there.

NASDAQ: Led he move outside SOX. It gapped upside, rallied through the 50 day SMA. Then it coughed up 72 points off the high in the afternoon session (closed up 81 points). It gave up the 50 day SMA on the high and is showing a gap higher to a tombstone doji. On the high NASDAQ found itself just over the mid-March high, the apex of the left shoulder to the head and shoulders pattern. Logical place for it to test back some perhaps, testing back near 7647 and perhaps setting up a right shoulder to an inverted head and shoulders as discussed over the weekend.

SP500: Similar action, gapping over the 50 day SMA then fading over half the move (18 points, closed 13 points higher) to close with a tombstone doji. Gapped off a doji 5 sessions back, could be a point to test. 2800, the support and neckline to the head and shoulders everyone is watching, may be a bit too much for it to test after this move, but it certainly would be a good test and set up a good pattern to play.

DJ30: Modest gap higher, a rally to the February peak near 26,250, then a fade to its own doji. Six sessions upside to resistance, a good place to test a bit and set up a new leg higher. Would it go to the neckline at 25,250? It could, but anything from 25,750 to that level is in play as potential support.

SOX: SOX also gave some back off the session high, but it posted an important move. It gapped through the gap created by the 5/20 downside gap. Always important when a stock or index gaps back through a prior gap as that shows it has power to wipe that gap off the books so to speak in an island reversal move. Closed 16 points off the high but closed up 35 - held onto most of the gain. This is good for the market overall. The other indices don't have to follow in lockstep, they can test and then follow as is often the case.

SP400: Gapped to some pretty serious resistance at 1920 and faded from there. Nothing major - it rallied six sessions including the gap, and a bit of a fade is normal. As with the other indices, a test to 1865ish would have the look of putting in the right shoulder to an inverted head and shoulders.

RUTX: Gapped upside, rallied to the 50 day SMA, then gave up 12 points (closed up 9 points). Lagging and tagging along.


LEADERSHIP

FAANG: AMZN was the power, rallying over 3%. GOOG was in that game, but then it stalled and gave up half its move to close just below the 10 day EMA. FB, APPLE moved modestly higher, showing their own tombstone doji. NFLX just out and out sold, dropping from an attempt to break through the 50 day MA. NASDAQ 100 was up more than NASDAQ overall, but these stocks were not the catalysts outside AMZN.

Software: Excited by the CRM/DATA deal. NOW gapped higher near the May peak, faded to close just modestly higher. COUP gapped, surged, then closed with a very pronounced tombstone doji. HUBS up but well off the high, still bearish near term. WDAY gapped to a tombstone right at the late May tombstone that was the high of that move. ZS gapped over the 50 day EMA and rallied to the 50 day SMA. VMW still putzing around at the 200 day SMA. MSFT gapped to a new high, but also closed with a tombstone; a pullback on this one provides an entry opportunity.

Personal Products: Held up well, EL added upside. PG recovered from a dip to close flat. CL stalled and started to fade so we banked some solid gain on the options. CLX hanging on in a test that started Friday.

Chips: AMD up again but gapped to a tombstone doji. AMAT solid with a gap over the 50 day SMA and a rally to the close. TXN moved over the 50 day SMA. XLNX broke over the 20 day MA. INTC continued upside on low volume. They are working upside.

Drugs/Biotech/Healthcare: Did their usual: After a good late week move they faded on Monday. Doesn't have to be Monday, just the day following a good move. Happened to PCRX, PTCT, ARNA, TNDM. Didn't break the patterns at all, just seems to be their on/off MO.

Social: SNAP was a bit lower on very low trade. MTCH jumped higher then gave it up for a modest loss holding the 10 day EMA. FB tombstone doji at the 6/3 lower gap point. TWTR gapped upside adding to the Friday surge but reversed to close lower. Not social's day.

Machinery: Moved upside then faded. CAT gapped and rallied, faded to a tombstone. DE gapped and ran to the 50 day EMA where it stalled and faded to a tombstone. We took some nice gain early. UTX gapped upside then reversed it all to close at the 200 day SMA. At first the market liked the deal then they punished UTX.

Financial: MA and V gapped higher then faded to modest gains after both put in solid moves last week. Banks were up then faded though some decent attempts upside from JPM, C.


MARKET STATS

DJ30
Stats: +78.74 points (+0.30%) to close at 26062.68

Nasdaq
Stats: +81.07 points (+1.05%) to close at 7823.17
Volume: 2.11B (+2.21%)

Up Volume: 1.47B (-160M)
Down Volume: 632.46M (+135.3M)

A/D and Hi/Lo: Advancers led 1.85 to 1
Previous Session: Advancers led 1.93 to 1

New Highs: 120 (-32)
New Lows: 52 (-59)

S&P
Stats: +13.39 points (+0.47%) to close at 2886.73
NYSE Volume: 740.456M (+1.71%)

Up Volume: 409.862M (-64.537M)
Down Volume: 320.656M (+93.334M)

A/D and Hi/Lo: Advancers led 1.53 to 1
Previous Session: Advancers led 2.83 to 1

New Highs: 208 (-84)
New Lows: 27 (-19)


SENTIMENT

VIX: 15.94; -0.36
VXN: 19.98; +0.05
VXO: 16.57; -0.82

Put/Call Ratio (CBOE): 0.78; -0.01. Recall the put/call ratio put in almost 20 sessions over 1.0 with just a few closed below that level. Lots of downside protecting and speculation and now a bit of a relief rally takes the pressure off.


Bulls and Bears:

One of the most spectacular moves in recent memory. Bulls dropped over 6 points while bears jumped 1.2 points. Of course, those more bearish moves pushed stocks the opposite direction

Indicator level: Fell from yellow to green, indicating the approach toward extremes did not make it and the pressure was released with the Friday rush higher in the stock indices.

Bulls: 42.7 versus 49.0 versus

Bears: 18.5 versus 17.3

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.






OTHER MARKETS

INTEREST RATES

Threat level: Red-ish. 3 month/10 year spread inverts a third time. 5 year, and 2 year are below the 3 month treasury. Third 10 year/3 month inversion this year. The positive: the 2 year/10 year is not inverted.

The 3 month yield versus the 10 year: Spread fell 6BP to -13BP. -26BP was the high water mark on this particular move. Healing.

The 2 year versus the 10 year: Spread held at 23BP. Still healing itself.

10 year: 2.15% versus 2.084%

3 month: 2.279% versus 2.277%
2 year: 1.917% versus 1.851%

Historical: the last sub-2% rate was in November 2016 (1.867%). Last trade over 3% was November 2018. 2.6% for quite some time, then yields started higher, first run from November to January, then mid-March.


The Dollar: There are two schools of thought. First, those who believe a strong dollar is in the interest of the US. Reagan (though not all of his advisors) and Clinton were strong dollar Presidents. Second, there are those who believe a strong dollar prevents the US from selling US goods abroad. The Bushes (1 and 2) and Obama were in this category. The thing is, the US is always its economic strength peak when its consumers are consuming, and that is when there is a strong economy and a strong dollar: they consume both US and foreign goods. History shows this again and again, and thus it is worth watching the dollar as a gauge of how the US economy is performing.

EUR/USD: 1.13134 versus 1.13326. After surging to the 200 day SMA Thursday, stalled Friday, doji Monday. Key level as is obvious in that it failed three prior attempts to take it out.

Historical: Back into the 6-month range formed after the euro sold off from the early 2018 peaks after a week below it.


USD/JPY: 108.425 versus 108.18. Bumping the 10 day EMA where it left off last week after a modest rally off the recent selling. Not looking as if it will take it out. Rate cut talk does that.

Historical: Last below 109 in June 2018 then tumbled to 107 in early January 2019. 114.51 is the recent high from October 2018.


Oil: 53.26, -0.73. Tapped the 10 day EMA on the high, faded to a loss. Oil does not have much strength.


Gold: 1329.30, -16.80. After the rally from 1274, a bit of a pullback is in order.


TUESDAY

The power of the Fed backing and some relief from the trade news took stocks higher another session, stretching the move to 5 or 6 sessions depending upon the index. A good bear market relief move that has the big asterisk next to it: Fed aided. Of course, with the Fed believed to be in the game, then upside can occur when it appears no upside can occur.

Thus, with the indices up that many sessions on overall lower volume and weak breadth, one would anticipate a pullback. Heck, even with the Fed there a pullback is still a normal part of the process. The doji at resistance, gaps to doji, further suggests a pullback is at hand.

That is good. If the Fed is going to push stocks higher, then a pullback provides great opportunity for more upside positions. A pullback to the old neckline - or close to it - morphs the near term outlook for a test of the old highs, and of course that is something we want to play.

Accordingly, given the action we didn't buy too much today - the gaps higher on top of the moves thus far did not provide many good entries. A test will. It also means we are on market pullback watch. Not for a crash - though you have remain open to the possibility - but a pullback to test the recent Fed-save move. Again, that is not a bad thing, just need to be aware of it for upside positions as well as downside as many of the latter have bounced with the market and are in position to retrace.

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.

Sunday, June 09, 2019

No Need to Fear, the Fed is Here (Weekend Newsletter)

You have 73 VIP Points worth $73! This newsletter is worth 3 points.* (more info)
THE WEEKEND ISSUE
Informing Investors Around The World
Read In All 50 States And Over 100 Countries
You have earned 73 points worth $73 Click here for details*

Weekend Newsletter for
June 9, 2019


Table Of Contents

1) MARKET SUMMARY from THE DAILY

2) STOCK SPLIT REPORT

3) IH ALERTS

4) SUCCESS TRADING GROUP

5) COVERED CALL SERVICE

      

Jon Johnson
1) MARKET SUMMARY
         > >From "The Daily" by Jon Johnson at InvestmentHouse.com


Stocks stretched the post-Monday gains through Friday.

- Jobs report misses big headline and wages are slowing. No need to fear, the Fed is here.
- Mexico tariffs put off. It is sad it took a tariff threat to get action, but it was the one thing that got Mexico to act.
- Indices head higher another session in the rebound, again on less than solid internals.
- Market downside technical setup versus the Fed backstop.
- Fed may be behind the market again, but outside of some express talk about a rate cut, what more can the Fed do to drive stocks higher near term?
- After a big rebound week, watch for some downside. But also watch for key support to hold and suggest new upside.


Market Summary (continued)
Stocks stretched the post-Monday gains through Friday, aided by an even firmer conviction - thanks to a jobs report miss -- the Fed would cut rates, and the Administration indicating there would be no implementation of Mexican tariffs.

Stock futures were higher ahead of jobs, fell on the paltry 75K gain in non-farm payrolls, but then reversed to pre-market highs as traders figured a weak number even further strengthened the odds for a near term rate cut. Stocks surged into midmorning then held the very solid gains through the close.

SP500 29.85, 1.05%
NASDAQ 126.55, 1.66%
Dj30 263.28, 1.02%
SP400 0.56%
RUTX 0.72%
SOX 1.15%
NASDAQ 100 1.94%

VOLUME: NYSE -8%, NASDAQ -3%

ADVANCE/DECLINE: NYSE +2.8:1, NASDAQ +1.9:1

The action on the week managed to wipe away the late May selling, the second leg lower in the selling from the April peak and the move that broke the head and shoulders patterns through the necklines. Impressive recovery in price.

THE question, of course, is whether this was a repudiation of the break lower. I often say a head and shoulders pattern sets up just to fool you. These appeared to be serious, however, given they made up the second top to the large double top patterns.

Read "The Daily" Entire Weekend Summary
Watch Market Overview Video
Watch Technical Summary Video
Watch Next Session Video


Here's a trade from "The Daily" and insights into our trading strategy:


Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.

With the down and up week we had plays in both directions.

QID (ProShares UltraShort QQQ)
Company Profile
With the downside dive Monday on the anti-trust worries on the FAANG stocks, we banked the QID gain. We picked up some July $34.00 strike calls on 5/24 for $2.67 as NASDAQ continued to sell after gapping downside the prior session. From there NASDAQ sold steadily with a crescendo Monday. We sold the calls for $5.10, banking 114%.

HIIQ (Health Insurance Innovations Inc.)
Company Profile
Healthcare has shown some buying and we saw HIIQ break higher on 5/31, ready to break from an inverted head and shoulders pattern. We put it on the report, and the next session when HIIQ broke higher we bought the stock for $26.85 and some August $25.00 calls for $4.90. HIIQ moved higher each session then gapped upside and rallied early Thursday to our target. We banked half the stock for $32.70, a 21+% gain. We banked the options for $8.60, a 75% gain.

AMD (Advanced Micro Devices Inc.)
Company Profile
AMD put in a very tight lateral consolidation from April to mid-May. We put it on the report, anticipating a break higher. It did so on 5/28 and we moved in with stock at $28.42 and some July $28.00 strike calls options at $2.38. A very strong break higher Thursday took AMD out of the 8 week consolidation. Friday AMD added a bit more, hitting the target. We banked half the stock for $32.44, a 14% gain. We also banked half the options for $5.10, a solid 114% gain.

Receive a 2 week trial and if you stay on receive a $30 per month discount!

2) STOCK SPLIT REPORT

Here's a leader play and our current analysis.

Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
AXSM (Axsome Therapeutics--$22.03; +0.45; optionable): Drugs
Company Profile
EARNINGS: 08/08/2019
STATUS: ABCD. Looking for some more upside gain from AXSM as it has come back the past 2+ weeks to form an ABCD consolidation pattern. Tapping Thursday and Friday on the intraday lows at the 78% Fibonacci retracement of the early May upside gap and run, then posting a solid Friday advance. Looks as if the pattern in in place, and as AXSM continues upside we want to move in for a run to the prior high. That rally gains 18% on the stock, 55%ish on the options.
CHART VIDEO
Volume: 1.241M Avg Volume: 1.336M
BUY POINT: $22.19 Volume=1.6M Target=$26.45 Stop=$20.64
POSITION: AXSM AUG 16 2019 22.50 C - (57 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!



Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
3) IH ALERTS

FTNT (Fontinet, Inc.--$73.82; +0.22; optionable): Software
Company Profile
EARNINGS: 08/01/2019
STATUS: Bear flag. After a decent enough move to mid-April, FTNT started some selling. Gapped sharply lower early May, again on May 23. Sold hard on that gap to last Monday, then the rebound to test the 10 day EMA on the Friday high. Closed with a doji Friday, a short tombstone. Low volume rebound. If it continues lower we want to play, and we want to be in for a possible third cap lower. A move to the target gains 50%ish on the put options.
CHART VIDEO
Volume: 1.193M Avg Volume: 1.694M
BUY POINT: $73.47 Volume=2M Target=$66.42 Stop=$75.80
POSITION: FTNT AUG 16 2019 75.00 P - (-50 delta)

Save $600 per year and enjoy a 2 week trial of our IH Alerts Service!


Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
4) SUCCESS TRADING GROUP
--by the MarketFN STG Team

PEP (Pepsico Inc.)
Company Profile
Our Success Trading Group members scored another winning trade this week when we closed out a position in Pepsico Inc. (Ticker: PEP). We currently like Snap Inc. (Ticker: SNAP) at its current price for new positions.

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. 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.


Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
5) COVERED CALL PLAY

TER - Teradyne Inc. is currently trading at $45.21. The July $45.00 Calls (TER20190720C00045000) are trading at $2.15. That provides a return of about 5% if TER is above $45.00 on expiration Friday in July.
Company Profile



Learn more about our Covered Call Tables


PREMIUM SERVICES
IH Alerts: InvestmentHouse.com's Best of The Best Plays!
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.

NOTE: You have 73 VIP Points!

* Each VIP Point is worth $1 off the price of any of our monthly subscription newsletters!

The Daily, Part 1 of 3, 6-8-19

* * * *
6/8/2019 Investment House Daily
* * * *

Investment House Daily Subscribers:

MARKET ALERTS:

Targets hit: AMD
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

********************************************************************
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.

SUMMARY

- Jobs report misses big headline and wages are slowing. No need to fear, the Fed is here.
- Mexico tariffs put off. It is sad it took a tariff threat to get action, but it was the one thing that got Mexico to act.
- Indices head higher another session in the rebound, again on less than solid internals.
- Market downside technical setup versus the Fed backstop.
- Fed may be behind the market again, but outside of some express talk about a rate cut, what more can the Fed do to drive stocks higher near term?
- After a big rebound week, watch for some downside. But also watch for key support to hold and suggest new upside.

Stocks stretched the post-Monday gains through Friday, aided by an even firmer conviction - thanks to a jobs report miss -- the Fed would cut rates, and the Administration indicating there would be no implementation of Mexican tariffs.

Stock futures were higher ahead of jobs, fell on the paltry 75K gain in non-farm payrolls, but then reversed to pre-market highs as traders figured a weak number even further strengthened the odds for a near term rate cut. Stocks surged into midmorning then held the very solid gains through the close.

SP500 29.85, 1.05%
NASDAQ 126.55, 1.66%
Dj30 263.28, 1.02%
SP400 0.56%
RUTX 0.72%
SOX 1.15%
NASDAQ 100 1.94%

VOLUME: NYSE -8%, NASDAQ -3%

ADVANCE/DECLINE: NYSE +2.8:1, NASDAQ +1.9:1


The action on the week managed to wipe away the late May selling, the second leg lower in the selling from the April peak and the move that broke the head and shoulders patterns through the necklines. Impressive recovery in price.

THE question, of course, is whether this was a repudiation of the break lower. I often say a head and shoulders pattern sets up just to fool you. These appeared to be serious, however, given they made up the second top to the large double top patterns.

The key fact to us is they did not break up the larger patterns formed since January 2018, the topping 'process' as I have called it. Lower volumes, weaker breadth, thinner leadership on the upside. Even the Friday breadth was not great with NASDAQ not even 2:1 and NYSE decent at 2.8:1.

That does not, however, keep you from playing upside moves as we did on this one. We took downside gain Monday, e.g. QID, then bought upside as the market rallied back Tuesday and on: HIIQ, DIS, TWLO, PEP, MCD - all provided good entries and HIIQ even gave us the gain on the week. These stocks were all in good patterns; in the kind of rebound move shown Friday, you get solid price moves even from stocks not in great patterns, e.g. AMZN, FB, GOOG. Of course we are already in other stocks that held decent patterns and started to move up again - as a good stock should: CL, PG, AMD, DE.

Thus, some very good moves from stocks in good position to move as well as stocks whose patterns were cracked. That happens even in overall downside markets, and despite the 4 sessions of gains (outside DJ30 that squeaked out a Monday gain), the bias is still lower.

No doubt the Fed and further rate cutting and other stimulus formerly known as 'extraordinary' that Powell now views as normal provides powerful upside stimulus - it did so for 9 years. If the Fed is truly in the game of playing market backstop - as the market appeared to believe to end the week, then even the 17 month topping action can give way to new highs.

That leaves the market at another proof point: will the top take over once more, or will the prospect of Fed intervention overcome the headline-led action and push stocks to new highs?

Stubborn bid refuses to quit.

Despite the negative overall look from the indices and many stock sectors, a few groups have steadily pointed higher. They are not typically viewed as related, but they are moving higher: personal products, software, food/eateries, social, credit services, drugs. We own some of these, bought into some on the week, and are looking at them more if they continue moving higher.

Why would you do so if the bias remains down? The groups have been tested but have not broken. There is a certain continued bid in the market, and even after some of these stocks were tagged Monday, they recovered and held their patterns. That says a lot for the strength: the sellers tried to take them out, but they hung on and popped back upside. Again, that demonstrates a strong bid.

Thus, even though we view the overall market pattern, internals, and leadership as downside, a stubborn bid remains. Moreover, that stubborn bid may be further augmented by the belief the Fed will help the markets sooner than later: bond yields are tanking, and no amount of Fed commentary otherwise, it fears deflation. Thus, I do believe the Fed will cut - not to join the crowd of 'I knew what was coming all along' pundits, but you recall I predicted a Fed cut in the making several months back. That, however, does not matter to the markets. What does matter is perceptions about the future, and with the Fed perceived as again having the market's back (okay, that is a growing perception, not a strong majority at the moment), the market could continue to find a bid. Has to prove it given the patterns, but the Fed is giving stocks a chance to move up when it looked as if they were in the process of rolling over.


THE MARKET

CHARTS

NASDAQ: Reversed off the Monday crash, rallying back up to the 50 day EMA by the Friday close. That puts NASDAQ back above the neckline in the head and shoulders pattern spanning early March to last week. Low volume, so-so breadth strongly suggest the move does not hold. As noted earlier, however, the Fed factor can thwart this downside technical setup - indeed, it helped thwart the break lower Monday.

SP500: Surged back from the head and shoulders breakdown as well, rallying to the 50 day SMA and January 2018 high at the close. As with NASDAQ, lower volume on the recovery, so-so breadth. Obviously a nice break upside price-wise but now at a seriously important resistance level to start the week. This week it shows if this rebound can test normally and hold on. What would be normal? A test back to 2800. Then a rebound. What is that? It would form a right shoulder to a short inverted head and shoulders - yes, from a head and shoulders to an inverted one. Have to acknowledge the changes when they occur. Of course, the operative word is 'when.' Not there yet.

DJ30: Up to the 50 day SMA as well, up all 5 sessions after showing a doji Monday just over the prior Friday low. Trying to break up that head and shoulders as well, back up to test the late February high in the left shoulder. Trying. Still has to prove it can do it.

SOX: Up on the week after holding a key low at 1300 the prior week. Many chip stocks making the same rebound move. Thus far it is truly just a rebound in a negative pattern, though there is more upside room to continue the rebound.

SP400: The midcaps posted an excellent week, up 5 sessions as was DJ30. Gapped lower two Fridays back then gapped upside Monday, a bit of an island reversal. Rallied through the 200 day SMA Friday with a gap, stalling at the 50 day EMA. That leaves SP400 smack in the middle of the range from February, and from our view, still downside bias unless the Fed has completely changed the game.

RUTX: The small caps lagged the move, making to the lows from March. Only two solid upside moves on the week, Tuesday and Friday. The small caps are still lagging and still sport the weakest pattern in the market.


LEADERSHIP

FAANG: The patterns are hashed for the most part, but Friday saw money move in with some of the best volume since the selling. AMZN jumped the 200 day SMA on strong trade. Even AAPL made it to the 200 day SMA on a gap and rally, showing above average volume as well. FB showed similar action, recovering to the 10 day EMA on above average trade. NFLX made it through the 50 day SMA on the high, just could not make it stick. GOOG finally awoke after its Monday DOJ anti-trust slam lower.

Personal products: Still solid, e.g. PG, CL, and EL.

Chips: Some names are performing as the group put in an interim bottom and is attempting a bounce. AMD up again on a big upside week. AMAT slowly climbing but on light trade. TXN to the 50 day MA. XLNX looks as if it wants to break higher, just has not done so. SWKS edging upside. INTC broke upward through the 20 day EMA; it can still be a buy this week after it tests that Friday move early week.

Software: After an ugly, ugly Monday, a very impressive recovery for this group. MSFT led the Friday breakouts. NOW is up to the old high. WDAY surged Thursday and Friday to near the old closing highs. COUP recovered to another new high. TWLO at a new closing high.

Drugs/Biotech/Healthcare: After a Thursday dip, a good recovery. PTCT, ARNA rebounded Friday off near support. PCRX surged Friday. TNDM still solid.

Social: SNAP enjoyed a strong week, testing a bit Friday. TWTR surged back through the 50 day MA's Friday on strong volume. MTCH still looks good for a new buy if it can hold one of these moves. FB finally got some snap Friday, making it to the bottom of the wedge after that sharp, anti-trust related Monday selloff.

MISC: MNST broke out Friday from a cup w/handle. We watched it, thought about putting it on Thursday night, didn't. Great. On a test Monday . . . V and MA surged upside to new highs. VRSN new highs again. TREX looks possible for a new buy. ZEN, SHOP both surged nicely; a dip early week could set up some new buys.


MARKET STATS

DJ30
Stats: +263.28 points (+1.02%) to close at 25983.04

Nasdaq
Stats: +126.55 points (+1.66%) to close at 7742.10
Volume: 2.064B (-3.05%)

Up Volume: 1.63B (+440M)
Down Volume: 497.16M (-480.52M)

A/D and Hi/Lo: Advancers led 1.93 to 1
Previous Session: Decliners led 1.26 to 1

New Highs: 152 (+71)
New Lows: 111 (-31)

S&P
Stats: +29.85 points (+1.05%) to close at 2873.44
NYSE Volume: 727.973M (-7.82%)

Up Volume: 474.4M (-15.68M)
Down Volume: 227.323M (-62.964M)

A/D and Hi/Lo: Advancers led 2.83 to 1
Previous Session: Advancers led 1.37 to 1

New Highs: 292 (+98)
New Lows: 46 (-56)


SENTIMENT

VIX: 16.30; +0.37
VXN: 19.93; -0.39
VXO: 17.39; +0.40

Put/Call Ratio (CBOE): 0.79; -0.06


Bulls and Bears:

One of the most spectacular moves in recent memory. Bulls dropped over 6 points while bears jumped 1.2 points. Of course, those more bearish moves pushed stocks the opposite direction

Indicator level: Fell from yellow to green, indicating the approach toward extremes did not make it and the pressure was released with the Friday rush higher in the stock indices.

Bulls: 42.7 versus 49.0 versus

Bears: 18.5 versus 17.3

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.






OTHER MARKETS

INTEREST RATES

Threat level: Red-ish. 3 month/10 year spread inverts a third time. 5 year, and 2 year are below the 3 month treasury. Third 10 year/3 month inversion this year. The positive: the 2 year/10 year is not inverted.

The 3 month yield versus the 10 year: Spread rose 1BP to -19BP. -26BP was the high water mark on this particular move.

The 2 year versus the 10 year: Spread fell 3BP to 23BP. Made it to 26BP. Still healing itself.

10 year: 2.084% versus 2.13%

3 month: 2.277% versus 2.316%
2 year: 1.851% versus 1.875%

Historical: the last sub-2% rate was in November 2016 (1.867%). Last trade over 3% was November 2018. 2.6% for quite some time, then yields started higher, first run from November to January, then mid-March.


The Dollar: There are two schools of thought. First, those who believe a strong dollar is in the interest of the US. Reagan (though not all of his advisors) and Clinton were strong dollar Presidents. Second, there are those who believe a strong dollar prevents the US from selling US goods abroad. The Bushes (1 and 2) and Obama were in this category. The thing is, the US is always its economic strength peak when its consumers are consuming, and that is when there is a strong economy and a strong dollar: they consume both US and foreign goods. History shows this again and again, and thus it is worth watching the dollar as a gauge of how the US economy is performing.

EUR/USD: 1.13326 versus 1.12776. Euro screamed upside Monday, Thursday, and Friday, breaking through the 200 day SMA on the Friday close. That is the first close over the 200 day MA since January, indeed, the first time it moved over that level since January.

Historical: Back into the 6-month range formed after the euro sold off from the early 2018 peaks after a week below it.


USD/JPY: 108.18 versus 108.372. The dollar moved higher to the 10 day EMA on the week, then reversed hard downside Friday. Looks as if it failed at the 10 day EMA again.

Historical: Last below 109 in June 2018 then tumbled to 107 in early January 2019. 114.51 is the recent high from October 2018.


Oil: 53.99, +2.31. After another week of selling, oil jumped higher Friday. Still in the selloff.


Gold: 1346.10, +12.50. Continued the surge up to the February high. If all is well, why is gold surging? Economic data weaker? Fed going to cut rates? Both are valid.


MONDAY

A sharp price rebound with weaker internals than the sharp selling into Monday. Friday the rebound accelerated, again in price terms, as the weaker jobs data (aka prompting a nearer Fed rate cut) and the Administration forgoing Mexican tariffs. After all, jobs are lagging indicators, and if they are slowing then the economy overall is already significantly slower.

As noted earlier, that means this week is another important one. The indices broke support, a break that hit a crescendo with the Monday reported anti-trust moves against FAANG stocks. From there a relief move after the sentiment was about as negative as it gets. The indices bounced on lower volume, mediocre internals, and just a handful of leaders. The indices moved back above the neckline in the head and shoulders patterns but closed the week at resistance. After a week of releasing the negative emotions we will see what is left in the tank, how much Fed-fuel as it were.

To us it certainly looks like a prime spot to roll back over. I know, that goes against the hope in the populace in general, but it is what the patterns suggest. Again, the Fed can change all of that, but it would have to come out with more: last week the move was ginned up with Powell's comments and the solidifying of the view a rate cut is coming next and coming relatively soon. Will more Fed speakers hit the microphones to drive home the point? Will the Fed convene and emergency meeting and cut rates? With the market surging last week? Not counting on it.

The point: the market surely surged back upside last week, but that was with the 'good' news of weaker economics and Fed-speak that convinced the markets the Fed was more than ready to cut rates if the economics indicated it was necessary. What more is going to drive stocks this week?

Well, we will see. If the bids return, we have some good positions working and will be ready with more to add. The market has not taken down all leadership groups and they could put up some more breakouts. Even if there is an early dip this week some leaders could be put into buy positions.

If there is reversal action at this resistance, however, we won't be slow to get out of upside that starts struggling and put on some more downside. Will be ready with those as well - the market is downside bias after all, even with the past week's surge.

Watch the reversal, however. Sure it appears the bias remains low and the direction of least resistance is down. But how far? SP500 at 2800, a key level? NASDAQ 7650, another key level? A drop to that level that holds suggests even more upside recovery from some inverted head and shoulders patterns. Thus, on an early drop this week, watch 2800 on SP500 and 7650 on NASDAQ. If they hold we will be ready to transition to the upside with more gusto. After all, the Fed is behind the market now, right?

Have a great weekend!

End part 1 of 3
_______________________________________________________
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.