Thursday makes for the eighth consecutive win for the broader markets. Volume did not come in heavy today though, was lighter than Wednesday, which was really heavy volume. The TRIN closed neutral at .95 and that goes with our narrow range day. The VIX closed at 21.72 which is 11% off the 10dma, leaves us still to look for a snap the other direction. Gold fell $14.20 to $1050.50 and oil rallied $2.33 to close at $77.49 a barrel.
Daily charts has 95 stochastics, 66-69 and flattening off RSI, CCI dropped back to 125 and a flat MACD for the Nas Composite, Nas 100, SPX and Dow. The hanging men candle on the Nas 100 and Nas Composite from Wednesday did not confirm on Thursday. Closing higher across the broader indexes just extended the markets to higher levels and it seemed like a pause day with such a narrow range, not real continuation. The pause had a lot to do with Google and IBM that reported after the bell. GOOG traded up after hour and IBM down, splitting the markets reaction in the middle. IBM did beat on the top line, but margin was off just slightly and guidance was good. It was a sell the news situation, Google beat on EPS and revenue, they don’t give a lot of guidance usually and didn’t say much today. Also about 25 minutes after the bell Treasury Secretary Geithner said the US recovery is better than expected thus far. Futures haven’t reacted much to any of the news and nothing like what we saw Wednesday after the bell.
Coming into Friday we have a tired market that will start the day with big earnings and economic data into the bell. Everything I look at suggests the market needs to digest the last eight days and continues to narrow the range to wind for a move or rest. A pullback or continue sideways is the only way to work that off. The futures have not seen the weekly pivots and that isn’t likely to happen with the ES being 40 points away from 1052.25, NQ 43 points off and the TF 22 points off. That would be one very big drop in a single day, not out of the question but isn’t likely. It is expiration day for October options and that usually means a tight range and higher volume comes in. Because we’ve sat in range for the last two days off the gap up and then 4 days prior to that. Even putting the last 6 days together the market hasn’t moved that far. Which leaves us to look for some pullback through this range to refuel.
Economic data for the week (underlined means more likely to be a mkt mover): Friday 9:00 TIC Long Term Purchases, 9:15 Capacity Utilization Rate, 9:15 Industrial Production, 9:55 Prelim UoM Consumer Sentiment, 9:55 Prelim UoM Inflation Expectations. Sunday night 9 pm Fed Chairman Bernanke speaks, Monday 11:00 Fed Chairman Bernanke Speaks, 1:00 NAHB Housing Market Index. Tuesday 8:30 Building Permits, 8:30 PPI, 8:30 Core PPI, 8:30 Housing Starts,11:00 FOMC Member Warsh Speaks. Wednesday 10:30 Crude Oil Inventories, 12:00 FOMC Member Lacker speaks, 2:00 Beige Book. Thursday 8:30 Unemployment Claims, 10:00 CB Leading Index, 10:30 Nat Gas Storage, 1:30 FOMC Member Dudley speaks, 4:00 FOMC Member Evans speaks. Friday 8:30 Fed Chairman Bernanke Speaks, 10:00 Existing Home Sales, 11:30 FOMC Member Kohn speaks.
Some earnings for the week (keep in mind companies can change last minute: Friday pre market BAC, GE, HAL, MAT and nothing after the bell. Monday pre market BBT, and after the bell AAPL, BSX, TXN, ZION. Tuesday pre market BK, BIIB, BLK, EAT, CAT, COH, KO, DD, LXK, EDU, OXPS, PFE, STT, UAUA, UTX, UNH and after the bell CREE, GILD, ISRG, SNDK, SONC, SYK, YHOO. Wednesday pre market MO, BA, LLY, GENZ, KEY, MCD, MS, NOC, PENN, STJ, USB, WFC and after the bell AFFX, AMGN, EBAY, FFIV, ISIL, NE, NVLS, OSIP, QLGC, VMW. Thursday pre market MMM, T, DOW, EMC, FITB, JBLU, KMB, MRK, NUE, PFCB, POT, R, TRA, TRV, UPS, WYE, ZMH and after the bell AMZN, AXP, BIDU, BRCM, BNI, COF, CAKE, CMG, NFLX, PMCS, RMBS. Friday pre market HON, IR, MSFT, SLB, WHR, and nothing after the bell.
ES (S&P 500 e-mini) Friday’s pivot 1088.75, weekly pivot 1052.25. Intraday support: 1089.25, 1085, 1081.50, 1078, 1074.50, 1071.75, 1068.50 fills gap, 1063. Resistance: 1092.25, 1095, 1098.50-1100, 1110.50.
