Annual return of 118.79% - See How Click here now!
The follow through yesterday was on a surge in volume and price. NYSE volume was 1.6 billion, or +30% above average, and the Nasdaq was 2.3 billion, which was also about 30% above its average. The NDX ($NDX.X | Quote | Chart | News | PowerRating) and SPX ($SPX.X | Quote | Chart | News | PowerRating) had volume surges closer to +40%. The Dow ($INDU | Quote | Chart | News | PowerRating) ended +2.1%, SPX +1.9%, and NDX +4.1%. The volume ratio for the NYSE was 82, with 1.3 billion up and just 293 million down. Breadth was very positive at +1315.
The ($SOX.X | Quote | Chart | News | PowerRating) was +5.9%, which gives it a gain of about 17% in two days. We'll look for intraday shorts in semis if there are any reversal entry patterns. As expected, the cyclicals were up strong; defensive stocks, such as foods, were weak. The brokers exploded, as we said in yesterday's text, and any sustained move must include the brokers. The ($OSX.X | Quote | Chart | News | PowerRating) was up 4.2%, as the Mideast is heading for much bigger violence.
Surprisingly, we had good trade-through entries in (MRVL | Quote | Chart | News | PowerRating), (LTXX | Quote | Chart | News | PowerRating), (LRCX | Quote | Chart | News | PowerRating), (DPMI | Quote | Chart | News | PowerRating) and (BRCM | Quote | Chart | News | PowerRating) to catch a ride on yesterday's semi move. Hope you didn't take anything home. The SPX traded right through the 30-week EMA yesterday and hit the wall at the 200-day EMA zone. The Dow is very overbought and back to the 10,600 resistance where it initially broke down and retested its 200-day EMA back in July of '01. The SOX is certainly stretched out with emotion, while the housing stocks are becoming accidents waiting to happen, just like (NVDA | Quote | Chart | News | PowerRating) and (GNSS | Quote | Chart | News | PowerRating).
Greenspan flooded the markets with liquidity, taking rates to the lowest level in 40 years and not without reason, I assume. The reality is that capital spending by corporations must increase, along with real earnings. The NAPM, or now known as the ISM, means bupkis. What's manufacturing, 5% to 10% of our economy? Alfie doesn't have a choice. He's trapped, and rate increases will be pushed by the majority of hawks on his handpicked board if they sense this is really an economic pick-up. The only thing that can slow that down is political jawboning. Fed funds will not remain below reality, and that's where they are now.
Stocks Today
For today, absolutely no interest in continuation longs in extended semis or other similar stocks. We'll look for intraday shorts in (SPY | Quote | Chart | News | PowerRating)s, (DIA | Quote | Chart | News | PowerRating)s and (QQQ | Quote | Chart | News | PowerRating)s, but only if you get a defined reversal entry pattern. There will probably be some decent pullback long setups if price declines enough to force some shorts to jump in and cover some stock. Futures are small red as I am doing this at 7:15 a.m.
Daily chart long setups today, and I'm not thrilled by many of them, are (CSC | Quote | Chart | News | PowerRating), (BJS | Quote | Chart | News | PowerRating), (SLB | Quote | Chart | News | PowerRating), (CAM | Quote | Chart | News | PowerRating) and (BHI | Quote | Chart | News | PowerRating).
Also, (AVY | Quote | Chart | News | PowerRating), (GD | Quote | Chart | News | PowerRating), (DGX | Quote | Chart | News | PowerRating), (SEBL | Quote | Chart | News | PowerRating), (MERQ | Quote | Chart | News | PowerRating), (STT | Quote | Chart | News | PowerRating), (USAI | Quote | Chart | News | PowerRating), (BR | Quote | Chart | News | PowerRating), (PD | Quote | Chart | News | PowerRating) and (FLR | Quote | Chart | News | PowerRating).
Have a good trading day.
Five-minute chart of Monday's SPX with 8-, 20-, 60- and 260-period EMAs
Five-minute chart of Monday's NYSE TICKS
|
Additional resources from Kevin Haggerty:
Below are the tools that Kevin uses on the TradingMarkets Indicator page. To learn more about how to use them, click here.
|
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
