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3/19/2019 Investment House Daily
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Investment House Daily Subscribers:
Targets hit: CMG
Entry alerts: ETN; GOOG; MTCH
Trailing stops: None issued
Stop alerts: None issued
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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.
- Indices move higher, struggle to hold the gains outside a few chips, big NASDAQ stocks.
- Big growth still looks good as does big manufacturing/machinery.
- Other areas not so great: metals, transports, while energy and financial again cannot put two good moves together.
- FOMC decision may result in some volatility and giveback after the news is not news, but a test for many solid moves is a good thing, and the FOMC decision likely does not change the market character.
Some pre-FOMC decision tiptoeing -- for most of the market -- kept the indices more or less trading around the flat line.
SP500 -0.37, -0.01%
NASDAQ 9.47, 0.12%
DJ30 -26.72, -0.10%
NASDAQ 100 0.31%
VOLUME: NYSE +1.8%, NASDAQ +5.7%. A bit of churn on NYSE, A bit of buying on NASDAQ.
ADVANCE/DECLINE: NYSE -1.5:1, NASDAQ -1.3:1.
There are, of course, always exceptions. Chips were strong, at least some of the big names: AMD, AVGO, NVDA, MU. Big NASDAQ names carried the NASDAQ 100 to the second best gain of the day: AMZN, GOOG both put in solid sessions, and of course, the aforementioned big semiconductor names. Money definitely still willing to flow into certain names in tech, along with some other anointed names, e.g. CMG.
What does that tell you? There are still buyers of select names even when the market is semi-nervous ahead of an event such as an FOMC rate decision. That is an upside positive.
On the other hand, you have areas that again flashed possibilities, but again are struggling to hold onto a move. Same groups: financial, energy, transports.
Financial saw JPM gap just over the 200 day SMA but then reverse for a loss. C gapped higher over the 200 day SMA then reversed to give it up. GS, after a good Monday break upside, gapped higher then sold back in stronger, above average volume.
Energy: XOM gapped to a recover high out of its 2 week range, but it then reversed to a loss on rising, above average volume. CVX is still good, but COP, after recovering to fill the early March gap lower, looks as if it could be reversing.
Transports: DJ20 has not rolled over, but it is stalled below the 200 day SMA, moving laterally. Truckers sold off Tuesday (JBHT, WERN, SAIA). Airlines remain equivocal: AAL, LUV, SAVE. DAL is not that bad, but hardly great. The rails are the saving grace: KSU, CSX, NSC -- good recoveries, but they are hitting resistance from summer 2018.
Metals: Steel looks weak with STLD, AKS sporting something of head and shoulders patterns. Industrial metals stink as well as CLF broke lower from a 5-session rebound, closing below the 200 day SMA on a shot of the strongest above average volume in over a month.
To view, click on the following links:
NASDAQ, SP500: Both really stretched higher early session, extending the break over the resistance range. They peaked at midday, however, and sold lower into the last hour where a last half hour surge ensued that mitigated some of the selling, keeping them at the flat line. Still up for a 7.5 session move to higher recovery highs, and that places them at risk ahead of the FOMC decision Wednesday afternoon. At risk, you say? Okay, likely not at risk of rolling over -- unless the Fed starts talking hawkish again -- but rising for over a week into the announcement and moving over resistance starts to beg for a test of that breakout even if short term.
SOX: The chips tapped the lower level of the 2018 resistance, then backed off a bit to the close. The move over the February prior recovery high has had power. As with NASDAQ and SP500, however, it is up 7.5 sessions off that intraday low at that 200 day SMA. Solid advance to resistance. Perhaps it climbs a bit more, but gravity as well as pushing against the overhead resistance are strong forces.
DJ30: Moved through the lower level of resistance in the October/December range, then faded to give up the move, closing negative. Not a rip reversal though volume was up. Still, afterhours FDX is getting the whip, at 172 (closed at 181.41) with some rather weak guidance. That will weight on the Dow as yet another name gets whipped on a bit.
RUTX, SP400: Disappointing with higher starts then sold back. SP400 was denied at the top of the range. Not a rollover but was rejected. For RUTX is was just another day of lateral movement more or less as it consolidates the prior move. It is not over and done for these, they are just not getting the money pushed their way at the moment.
SP500, NASDAQ: Stretched the Friday break over resistance but not really powerful moves. Some powerful components (AMZN, CMG, HON, financials), but others were testing after good moves. A solid move of over a week to this point, still very possible these two take a breather, particularly with the Fed on Wednesday.
NASDAQ 100: Cracked through the top of the range and hold onto enough upside to close just over that level. Hello? Bob Pisani? Now NASDAQ 100 is over the resistance. Must be nothing but upside ahead. In reality, over a week higher off the 50 day EMA test, at resistance. They can go higher, but they likely test some before too long. That is okay, healthy, etc., but of course, if GOOG flies higher again after its 1-2-3 test, it and some others can provide continued upside support for a continuing rally.
DJ30: A second modest gain, still below the bottom of the resistance range. Some Dow components are starting to offset the weaker types such as BA and its heavy weighting. Financials are showing life as is energy. Manufacturing in the form of HON continues strong. Not chopped liver, just a victim of its weighting schema.
SOX: Took a breather after the Friday gap and run higher to new recovery highs. Doji pause, likely just a continuation doji that leads to more upside.
SP400: After four pancake flat sessions the midcaps broke back upside and cleared the 200 day SMA on the close. Still just below the top of the resistance range, but it has been here before, broken the ice, and is trying to recover lost ground and indeed put in higher recovery highs.
RUTX: Same action for the small caps though they are farther below the 200 day SMA and the prior recovery highs that matched the top of the Oct/Dec trading range. Lagging, but at least showing a solid new move.
FAANG: GOOG broke higher from its 1-2-3 pullback, moving on stronger volume. AMZN surged again but then gave up much with a doji; a test is what we want to get a good entry. FB is still at the 50 day EMA. AAPL hit near the 200 day SMA and faded a bit, this after a solid 6.5 session move. NFLX gapped higher but could not leave the range and faded to the 20 day EMA.
Chips: AVGO, AMD, NVDA all very strong, but many of the average Joe chips were sluggish.
Talked about energy, financial, transports and metals. Disappointing day, some looking disappointing longer term.
Manufacturing/Machinery: Broke nicely higher, but struggled to hold on, e.g. ETN, CMI, HON. Still solid overall.
Stats: +65.23 points (+0.25%) to close at 25914.10
Stats: +25.95 points (+0.34%) to close at 7714.48
Volume: 2.27B (-34.2%)
Up Volume: 1.44B (-760M)
Down Volume: 818.58M (-381.42M)
A/D and Hi/Lo: Advancers led 1.64 to 1
Previous Session: Advancers led 1.54 to 1
New Highs: 107 (-9)
New Lows: 30 (-14)
Stats: +10.46 points (+0.37%) to close at 2832.94
NYSE Volume: 947.494M (-65.17%)
Up Volume: 667.884M (-905.998M)
Down Volume: 270.974M (-833.254M)
A/D and Hi/Lo: Advancers led 2.09 to 1
Previous Session: Advancers led 1.41 to 1
New Highs: 108 (-29)
New Lows: 19 (-5)
VIX: 13.10; +0.22
VXN: 16.18; +1.06
VXO: 13.02; +0.88
Put/Call Ratio (CBOE): 0.81; -0.04
Bulls and Bears:
The pullback from the prior week stalled the bulls' advance a bit while bears moved back over 21 after a 2 week hiatus below that level. Not major change in the trends: bulls are moving back up, bears sliding again, and this past week's action will further those trends.
Bulls: 52.4 versus 52.9
Bears: 21.4 versus 20.6
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: 52.4 versus 52.9
52.9 versus 52.4 versus 51.9 versus 49.5 versus 48.6 versus 45.8 versus 45.4 versus 34.8 versus 29.9 versus 39.3 versus 45.4 versus 46.7 versus 38.3 versus 39.6 versus 42.9 versus 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
Bears: 21.4 versus 20.6
20.6 versus 20.4 versus 20.7 versus 21.5 versus 20.6 versus 20.6 versus 21.3 versus 29.4 versus 34.6 versus 21.4 versus 20.4 versus 21.50 versus 20.6 versus 19.8 versus 19.0 versus 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
Bonds: 2.616% versus 2.601%. Calm in the 8 session lateral move over the 50 day MA after recovering off the 200 day SMA drop and flop in late February.
Historical: the last sub-2% rate was in November 2016 (1.867%). Last trade over 3% was November 2018.
2.601% versus 2.591% versus 2.628% versus 2.625% versus 2.60% versus 2.641% versus 2.632% versus 2.641% versus 2.693% versus 2.715% versus 2.724% versus 2.759% versus 2.717% versus 2.673% versus 2.636% versus 2.672% versus 2.654% versus 2.695% versus 2.641% versus 2.641% versus 2.664% versus 2.654% versus 2.706% versus 2.686%
EUR/USD: 1.13526 versus 1.13359. Doji right at the 50 day MA. Again.
Historical: 1.13359 versus 1.13248 versus 1.13070 versus 1.13271 versus 1.12895 versus 1.12592 versus 1.12344 versus 1.1191 versus 1.13123 versus 1.13050 versus 1.13344 versus 1.13650 versus 1.13725 versus 1.13790 versus 1.1391 versus 1.13598 versus 1.13332 versus 1.13363 versus 1.14490 versus 1.13544 versus 1.12922 versus 1.12955 versus 1.12616 versus 1.3323 versus 1.12816 versus 1.13218 versus 1.13396 versus 1.13645 versus 1.1396 versus 1.14350
USD/JPY: 111.374 versus 111.432. Same as the euro/usd, this pair is holding the recent range, awaiting the FOMC decision.
Historical: Last below 109 in June 2018 then tumbled to 107 in early January 2019. 114.51 is the recent high from October 2018.
111.432 versus 111.470 versus 111.715 versus 111.314 versus 111.428 versus 111.165 versus 111.482 versus 111.624 versus 111.845 versus 111.856 versus 111.921 versus 111.433 versus 110.873 versus 110.53 versus 110.979 versus 110.670 versus 110.664 versus 110.786 versus 110.848 versus 110.469 versus 110.462 versus 110.945 versus 110.523 versus 110.488 versus 109.754
Oil: 58.89, -0.20.
Gold: 1306.50, +5.00.
FOMC day and with the pensive trade -- in most stocks -- Tuesday, the after-trade could be a bit volatile. Stocks have risen modestly into the result then portrayed subsequent volatility. The FFF contract says the Fed remains status quo, no surprise, but the statement is as usual the key. More hawkish, less hawkish, or walking the same fine line? Likely the latter, but that will disappoint some and thus you can get the volatility.
Even with that volatility, if the Fed holds pat, nothing has really changed for stocks. China/US trade deal is somewhere off in the distance, far enough out for the near term market to ignore it. Chips will face MU earnings Wednesday after the close, an important report for a big stock in an important sector.
As always there is reason for upset, and after over a week of gains perhaps it is enough for some profit taking in some stocks that have moved well. Hey, if AMZN wants to come back to test the 200 day SMA it broke through, perfect. A test is not a bad thing in most cases, and as noted Monday, we would look at that as an opportunity if good setups result.
We have some good positions working, we have been taking some gain as they rally, and will do the same as we look for stocks such as GOOG that are doing their own thing right now as we wait for others that have rallied for more than a week to come back and provide yet another entry point just as GOOG did today.
Have a great evening!
End part 1
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