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Monday, October 1st, 2012
1:50pm (EST)
Futures were slightly lower when we were doing the Weekly Wrap last night but had battled their way back to near even just before the European markets opened this morning. They got progressively better before the markets here at home opened which lead to a nice pop at the start of trading. Economic news also came in better-than-expected which added a little fuel to the rally.
The Institute of Supply Management (ISM) Index jumped to a reading of 51.5 for September, up from the 49.6 print for August, which was a 3-year low. Wall Street was looking for a print south of 50 for the 4th straight month so it was a pleasant surprise. A reading over 50 indicates business is “improving”.
Bernanke is also speaking as we head to press which might be causing some of the pullback as he tries to defend QE3. He is giving a speech to the Economic Club of Indiana and said his monetary policy strategy “is the same as it always has been”. He went on to say that this round of quantitative easing was aimed at longer-term rates. With short-term rates near zero what else was he suppose to say?
The bulls immediately pushed prior resistance on the ISM news but the indexes have given back some of their gains as we head into the second half of trading.
The Dow is up 106 points to 13,543 while the S&P 500 is up 6 points to 1,446. The Nasdaq is trading lower by 2 points to 3,114 while the Russell 2000 is down a point to 836.
We said in our Weekly Wrap and this morning in our Daily the bulls needed to get a win today to avoid a possible trend change. The charts we showed you this morning outlined the first and second waves of support and resistance. We also said volatility would be picking up so today’s action doesn’t surprise us as the battle will be decided in the final hour of trading.
We have a lot to cover with our current trades which are holding up well. Subscribers, check the Members Area for the updates and we will be back in the morning with a full report.
Tags: Dow, S&P quotes, TSM news
Posted in Economic News, Market Analysis | Comments Off
Wednesday, September 26th, 2012
1:35pm (EST)
The bulls are trying to rebound today but haven’t had much luck as the bears have controlled the majority of the action. Yesterday’s pullback was slightly bearish and the bears are targeting the second wave of support. If tested, it will be interesting to see if buyers step in or if they are waiting for a much larger pullback which may or may not come.
Today’s economic news was slightly bullish as Housing continues to show a comeback but worries over Spain have Wall Street’s panties in a knot. There is also an ongoing sea battle between China and Japan, and the upcoming earnings could be uninspiring. Given the headwinds, a retest to support levels was a given and we have to be careful of a choppy market going into October.
There are still a number of traders who feel there is a larger correction in store but we will wait for the signs before counting the bulls out.
We have a lot to cover today as we have added 2 New Trades and there are some important updates to go along with our current trades.
As we head to press, the Dow is down 8 points to 13,449 while the S&P 500 is off by 4 points to 1,437. The Nasdaq is lower by 22 points to 3,095 and is below the 3,100 level.
Subscribers, check the Members Area for the updates and we will be back in the morning with a full report.
Tags: Dow, S&P 500
Posted in Market Commentary | Comments Off
Thursday, August 16th, 2012
9:00am (EST)
The market ended mixed on Wednesday as the tug-of-war between the bulls and bears continued but there was action after the bell.
The Dow fell 7 points, or 0.06%, to end at 13,164. The blue-chips tested a low of 13,138 shortly after the open but rebounded to touch 13,192. The index fell just short of resistance but made a higher low which was still bullish.
The S&P 500 was up 2 points, or 0.1%, and finished at 1,405. The index made was able to hold the 1,400 level for the second-straight session after touching low of 1,401 before rebounding to reach 1,407.
The Nasdaq added 14 points, or 0.5%, to settle at 3,030. Tech opened at 3,013 which was the low but powered higher the rest of the day. The next level of resistance is at 3,050 with support at 3K holding like a rock.
The Russell 2000 jumped 7 points, or 0.9%, to close at 804. The index also opened in negative territory, at 795, but was able to reclaim the 800 shortly afterwards which the bulls held for the rest of the day. The S&P Volatility Index ($VIX, 14.63, down 0.22) dipped 1.4% and touched a low of 14.36 after peaking at 14.98 at the open.
After the close yesterday, Cisco System (CSCO, $17.35, up $0.18) did the bulls a favor by announcing sweet numbers for the quarter. Earnings estimates were all over the map but we told you, historically, they beat by a penny. Last night, they beat by two pennies. (read more…)
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Tags: CSCO earnings, Dow
Posted in Earnings, Market Analysis, Market Commentary | Comments Off
Monday, August 6th, 2012
1:15pm (EST)
The bulls are doing their best to end the bears’ 10-week Monday winning streak as the major indexes are pushing the next wave or resistance. The charts from the weekend were showing there was a good chance the market could push the upper channels of resistance and today’s action puts the bulls within striking distance of a breakout.
Economic news has been light today and there have been no time bombs from across the pond. Futures were improving before the bell which led to an opening pop as the market made a steady climb higher during the first hour of trading. Since then, the action has leveled off as the bulls reload for a possible run to 2012 highs.
We spent all weekend looking at charts until our head was spinning and although we are in a good position to play the market breakout (or breakdown), we just need to see a few more days of action to see how this will play out.
Trading ranges can be brutal and they are hard to identify until you are in them. The market hit new lows in late May and into June and bounced back with a vengeance just a few weeks later. Since mid-June we have warned of a choppy, range bound market and over last few weeks we have said the bulls could push resistance.
With earnings winding down and Europe buying more time to work through its debt issues, the bulls will need a catalyst or two to carry them to a breakout. We mentioned this morning there is a chance Ben Bernanke does something at the end of the month when the zombies meet in Jackson Hole, Wyoming and there are rumors Apple (AAPL, $623.29, up $7.59) will announce its iPhone 5 in mid-September with deliveries available shortly afterwards. Shares closed above $600 to start last week after gaining $15 the prior Monday and the 52-week high is $644.
The stock normally rallies ahead of these big events and the option pits are pretty active on Apple today. The Apple August (WEEKLY) 625 calls (AAPL120810C00625000, $4.35, up $1.75) are up nearly 70% today while the September 650 calls (AAPL120922C00650000, $9.50, up $1.90) are up 25%.
These two events alone could fuel the bulls’ enthusiasm but they are a month away.
So, the questions are, does the market rally up until then which is when we could see a breakout and then a sell the news event, or, does resistance hold? Today’s close will be an important first step which could provide us some clues on what to expect for the rest of the week.
As we head to press, the Dow is up 83 points to 13,179 while the S&P 500 is higher by 8 points to 1,399 and is within spitting distance of 1,400. The Nasdaq is advancing 31 points and is at 2,999 and has tripped 3,000.
Tags: Dow
Posted in Market Analysis | Comments Off
Monday, July 30th, 2012
12:40pm (EST)
We’ve had a busy Monday as we have opened two more new trades for our Daily and we were active with one of our Weekly Wrap trades as well.
The market got an opening pop which held for much of the morning but there has been a steady drift lower as the Wall Street and the world brace for the bevy of headlines due out this week.
We covered much of the “what if’s” and who’s meeting who last night and this morning and there isn’t much to update. Economic news has not been a factor today but will be for the rest of the week.
There are a few earnings reports we will be watching this week, including one for tomorrow, but the bulk of the action will come on Wednesday, Thursday, and Friday. While we said this morning the bulls could still push upper resistance, it’s good to see the bears have a little fight in them to start the week.
As we head to press, the Dow is down 19 points to 13,057 while the S&P 500 is off 4 points to 1,382. The Nasdaq is lower by 17 points to 2,941.
We have updated our 2 new trades from this morning with exit prices and what to expect this week. Both options were for September so we have plenty of time for the trades to play out.
Subscribers, check the Members Area for the latest and greatest.
Tags: Dow, Nasdaq, S&P 500, support and resistance
Posted in Market Analysis | Comments Off
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Bulls Trying to Rebound
Wednesday, September 26th, 2012
1:35pm (EST)
The bulls are trying to rebound today but haven’t had much luck as the bears have controlled the majority of the action. Yesterday’s pullback was slightly bearish and the bears are targeting the second wave of support. If tested, it will be interesting to see if buyers step in or if they are waiting for a much larger pullback which may or may not come.
Today’s economic news was slightly bullish as Housing continues to show a comeback but worries over Spain have Wall Street’s panties in a knot. There is also an ongoing sea battle between China and Japan, and the upcoming earnings could be uninspiring. Given the headwinds, a retest to support levels was a given and we have to be careful of a choppy market going into October.
There are still a number of traders who feel there is a larger correction in store but we will wait for the signs before counting the bulls out.
We have a lot to cover today as we have added 2 New Trades and there are some important updates to go along with our current trades.
As we head to press, the Dow is down 8 points to 13,449 while the S&P 500 is off by 4 points to 1,437. The Nasdaq is lower by 22 points to 3,095 and is below the 3,100 level.
Subscribers, check the Members Area for the updates and we will be back in the morning with a full report.
Tags: Dow, S&P 500
Posted in Market Commentary | Comments Off