Tuesday closed the day with a modest win across the broader markets. Volume for the NYSE, Nasdaq and futures came in slightly heavier than Monday’s to give the market an accumulation day. The TRIN left the bears looking over the bulls shoulder closing at 1.40 bearish on the day and the VIX snapped back within 5 cents of the 10dma to 16.20. The weak start on the market took the first half of the day to work off and get the market back to where it closed Monday, then a slow steady lift set in with the Nasdaq leadership. Gold closed down $14.40 to $1147.80 and oil fell 33 cents to $84.01 a barrel.
Good earnings out of CSX, INTC and LLTC after the bell all sending futures higher in the globex session. That is likely to hold for a gap into Wednesday. INTC is known for a sell the news kind of move, but don’t get in a hurry to see that. It can take awhile and the gross margins are up which hasn’t been the case every quarter for them to see improvements. Early data and we have JP Morgan into Wednesday’s pre market which will also play into the markets tone. So INTC isn’t alone on the pedestal for a catalyst into Wednesday.
The daily charts on the COMPX, NDX, SPX all have the RSI over 74, CCI is flat not rising with these tiny lifts everyday and stochastics over 95 on each as well as a piercing of the upper Bollinger band. The move is extended and has some room yet ..the RSI can move over 80, stochastics can move a little more and the CCI has plenty of room and we can crawl through the upper Bollinger or continue to slide up for longer than you can stay short in this advance. So my point is stay neutral and pick your spots still. The Dow has 70 RSI, and only 91 stochastics and no piercing of the upper Bollinger yet. Banks and hardware sectors left a red day and a possible bearish engulfing pattern. Brokers remain under 112.28 78.6% resistance, the SOX doesn’t have a lot of anything in this area which leaves it open for the upside.
Into Wednesday unless the data derails the bull train we’ll look for a gap up to fade. The initial impulse may carry us a little higher off the opening and we’ll bracket the opening range to find an entry for either side. But my initial thought is we finished strong on the day, INTC pumped the bulls up and we’ll need to exhaust the upside to start a fade on the morning. The ES tested the weekly pivot and that leaves the NQ and TF not testing it still. We do see that happen with one testing and not the others, but the week isn’t over yet. If we do the normal several days of fading the INTC news we will get the NQ there.
Economic data for the week (underlined means more likely to be a mkt mover): Wednesday 8:30 Core Retail Sales, 8:30 Core CPI, 8:30 Retail Sales, 8:30 CPI, 9:30 FOMC Member Pianalto Speaks, 10:00 Fed Bernanke Testifies, 10:00 Business Inventories, 10:30 Crude Oil Inventories, 2:00 Beige Book. Thursday 8:30 Unemployment Claims, 8:30 Empire State Manufacturing Index, 9:00 TIC Long Term Purchases, 9:15 Capacity Utilization Rate, 9:15 Industrial Production, 10:00 Philly Fed Manufacturing Index, 10:30 Natural Gas Storage, 12:15 FOMC Member Bullard Speaks, 1:00 NAHB Housing Market Index, tentative Treasury Currency Report. Friday 8:30 Building Permits, 8:30 Housing Starts, 9:55 Prelim UofM Consumer Sentiment, 9:55 Prelim UofM Inflation Expectations.
Some earnings for the week (keep in mind companies can change last minute: Wednesday pre market ASML, JPM, PGR and after the bell JBHT, YUM. Thursday pre market SCHW, FCS, BTU, PPG, TITN and after the bell AMD, AMLN, BIIB, CBK, GOOG, ISRG, PLCM. Friday pre market BAC, GE, MAT and after the bell IEX.
BKX (Banks) closed -.62 at 55.35. Support: 54.35, 53.22, 52.42, 51.40. Resistance: 56.41-56.88, 57.93, 59.71
