Wednesday brought another gap up and held the days gains for a higher close. Volume came in mixed with the NYSE lighter and the Nasdaq heavier, futures were also mixed with the ES, NQ lighter and TF heavier. The VIX closed at 21.72 just off the February 3rd swing low and the TRIN closed neutral at .94. Gold closed up 20 cents to $1120 and oil up 32 cents to $77.33 a barrel. After the bell news came in good for PCLN, AMAT, HPQ, NTAP, ADI…all up in after hours, LVS, NVDA, CHK ..all down in afterhours trading.
Although the day ended higher the range was still narrow and came in slowly today. The gap faded to then reverse the market, which sat us in range. It was almost a carbon copy of Tuesday’s action other than Wednesday faded the gap and then move up to sit in range and move very little. It is hard to think Thursday can bring action in triplicate, so we’ll be prepared for things to get changed up some. The daily candlestick on the Nas 100 and Nas Composite left a possible hanging man, it is the weakest reversal candle, but should be watched. The SPX and Dow left fat little marubozu candles, but very narrow ranges outside of yesterdays for continuation.
The indexes are still sitting just under the 50dma which are resistance. A pullback here and an opportunity to find volume for a run up would be healthy for the market to try to break the 50dma’s. Intraday is not overbought leaving the bulls with some room still to move. With the powerhouse big cap Hewlett Packard (HPQ) coming in strong after earnings released the tech sectors will have reason to be happy, pre market we’ll hear from WalMart (WMT) and get some key data releases. WMT sits just under the 55.20 January 13, 2010 highs, which is the highest the stock had traded since January 2009. The RLX (retail sector or you can use RTH the retail holdrs trust) is just over the 50dma and getting extended, a big gap up on retail stocks could exhaust this move and look for some opportunity in TGT, SHLD, COST, ROST along with WMT for a pullback on any early strength.
Futures again today held well over the weekly pivot, but in addition to that the daily pivots were not tested. That is two days we have not seen the daily pivots, VERY unusual. The weekly we like to test early in the week and most weeks we do, but we can skip a week of that and not be concerned. Not seeing the daily for two days is VERY rare and not likely to happen into Thursday. Thursday is likely to open very near the pivots and be rotational off those levels. The daily pivots are: ES 1097.5, NQ 1807.50 and TF 622.90. The NQ has 1825 as the big level overhead and the ES at 1106.50. like to see the ES pullback to 1084.5 and the NQ into 1790.25 before we let the bulls totally run away so look for that into Thursday.
Economic data for the week (underlined means more likely to be a mkt mover): Thursday 8:30 PPI, 8:30 Unemployment Claims, 8:30 Core PPI, 10:00 Philly Fed Manufacturing Index, 10:00 CB Leading Index, 10:30 Natural Gas Storage, 11:00 Crude Oil Inventories, 6:00 pm FOMC Member Duke Speaks. Friday 8:00 FOMC Member Dudley Speaks, 8:30 Core CPI, 8:30 CPI
Some earnings for the week (keep in mind companies can change last minute: Thursday pre market APA, GT, ITWO, INCY, MGM, POOL, PDE, TRA, TTC, WMT, and after the bell DELL, FSLR, INTU, JCOM, WMGI. Friday pre market JCP, PCG, SHPGY and nothing after the bell.
ES (S&P 500 e-mini) Thursday’s pivot 1097.50, weekly pivot 1070.50. Intraday support: 1095, 1092-1090, 1084.50, 1079.75-1079, 1077 38.2%, 1070-1068, 1063.25, 1058. Resistance: 1101.50, 1104.75 50dma, 1106.50-1107, 1111.50, 1115.75-1116.50, 1119.50, 1124.25-1125
