Tuesday closed the day green and on heavier volume, following Monday’s anemic volume and range it didn’t take much to outpace. The VIX closed at 17.92 and the TRIN at .74 bullish on the day. The day stalled out at 1:30 and started to tip off the highs slowly. Gold closed down $2.20 to $1121.80 and oil closed off 38 cents to $81.49 a barrel.
The close was mid range and left a shooting star candlestick on the day for each index. The Nas Composite and Nas 100 left stochastics at 95 and the lines coming together, CCI fell off today despite the higher close and the RSI at 71. The Nas 100 hit new highs on the year and the Nas Composite is still making new highs on the year. Positive move for each index and with volume, however that daily candle and the overbought condition has to bring in some cautiousness for further upside. The SPX stochastics are starting to turn down and closed at 94, RSI is 66 so not as high as the Nasdaq and the CCI dropped on the day into 139. The Dow has a 92 stochastics starting to turn down, RSI 62 and CCI falling again despite the higher close so divergence there. The Dow and SPX aren’t piercing the upper Bollinger band like the Nasdaq indexes.
Looking at some key sectors the internets (INX) is very overbought, telecom (XTC) not as overbought as the INX but certainly should be watched at this level. Banks and brokers are into price resistance, but not overbought. The SOX remains in the range its been stuck in for six days. Hardware is also into price resistance and stuck under the 50dma. So some room still but not necessarily a lot of room and Internets really bother me at this level. Few stocks, AAPL (Apple) is over extended and into fib extension resistance. Google (GOOG) is into 38.2% retracement resistance and the 50dma. The daily is bothersome at this level and a pullback into 535 area would be healthy.
Into Wednesday I will look for the possible 5 minute and 13 minute inverted cup and handle to continue to form. The day ran out of time so we are starting the handle, keep posted for this into Wednesday. That is a bearish pattern if it triggers which would have to be early Wednesday to finish and trigger. Futures still have not seen the weekly pivot and after missing it last week we are on watch this week for that lower level to test. Those levels would come very close to the inverted cup and handle measured move.
Economic data for the week (underlined means more likely to be a mkt mover): Wednesday 10:00 Wholesale Inventories, 10:30 Crude Oil Inventories, 2:00 Federal Budget Balance. Thursday 8:30 Trade Balance, 8:30 Unemployment Claims, 10:30 Natural Gas Storage. Friday 8:30 Core Retail Sales, 8:30 Retail Sales, 9:55 Prelim UoM Consumer Sentiment, 9:55 Prelim UoM Inflation Expectations, 10:00 Business Inventories.
Some earnings for the week (keep in mind companies can change last minute: Wednesday pre market AEO, PLCE, QLTI, and after the bell BLDP, FCEL, GYMB, HOTT, IPAR, JAS, MW, SMTC, WES. Thursday pre market ARIA, IMAX, NGPC, NPSP, GASS, and after the bell GG, NABI, NSM, PSUN, SEAC, SHFL, ZUMZ. Friday pre market ANN, KIRK, PEI and nothing after the bell.
