Friday, February 08, 2019

Market Alert - To the Close

Not a bad response, an afternoon rally after a soft open. That down then up action shows the continued upside bias and also continues the bullish aspect of the market.

To be sure, the indices are still lower, though RUTX is flat to higher, but they are in a very good-looking test that is not closing on lows, but is testing lower and finding bids, closing up off the lows.

It helped that the White House announced that Mnuchin and Lighthizer are going to China Feb 14-15. No Kudlow, no Ross, no Navarro. This is seen as the administration wanting to make a deal. Okay, we will see. Then, it is the EU . . .

Stocks did find extra recovery fuel from that news and SPY is trading at session highs; lower, but at session highs.

Software is strong again, chips are holding well and setting up anew, some industrial metals are not bad. ADBE is looking pretty good, SBUX moving higher. Even so, moving in on this Friday during an ongoing pullback is not an idea that has us here in the office fired up. If these patterns continue setting up and holding, there will be good buys coming this week at some point. It's not that we don't trust this Friday move that got legs on perceived positive moves, we just don't trust the news on trade and that it will remain positive. The White House likes to goose the market going into the weekend as that is when most people take any time to look at it. So, goose it, avoid a selloff, then see what the next week brings.

AMZN may present some kind of buy as well -- New York wanting to block its new HQ, the Bezos/Enquirer feud have it below the bottom of the 5 week range. When the smoke clears AMZN could start back up, and that could provide a good entry.

SP500 -2.22, -0.08%
NASDAQ -1.98, -0.03%
DJ30 -116.40, -0.46%
SP400 -0.22%
RUTX flat
SOX -0.23%
NASD 100 -0.05%
Jon Johnson, Chief Market Strategist

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