Wednesday KA-POW we see RED, alright not horrid drop but the market did get shot in the foot. However, the bleeding stopped and we reversed off the lows to close just modestly red. Volume notched up and left the NYSE with a distribution day and the Nasdaq managed to just sit under yesterdays volume so no distribution day there. That is alright to split as we try to make heads or tails of this action. The TRIN unusually low despite the bearish drop, it closed at .43 which is quite bullish. The VIX finished the day at 24.90. Gold dropped $3.30 to $966.40 an ounce and oil moved up 44 cents to $71.86.
The Nasdaq Composite and Nas 100 are sitting on the 10dma, which is the first touch of this moving average since July 14th. The SPX and Dow are still just over that moving averages. This pullback today helped the RSI to turn down and work off some overbought look to it. CCI is hanging around 100 line and MACD is still very quiet and flat lined. Coming into Wednesday we were looking to see if the C leg on that ABC 13 minute pattern would come into play, never came through, so that is null. We opened weaker and never saw that move up to complete the C leg, so just never setup for us. Moving on!!
Into Thursday, it has been a quick week and now we have a market that is teetering. The financials strength held the markets ground and let us have a digestive day. Still in range and possibly a bearish engulfing pattern to come, watch the 10dma as we move now for support to let us step lower off it. Also keep an eye on the upper Bollinger on those daily, starting to see it curl over a little. CSCO is trading down in the afterhours and is pushing the market lower as the conference call continues. Chambers is RARELY overly optimistic and his comment about the market still being “squishy” (his word) is sending us lower. Even without the CSCO push down, I was looking for another weaker opening, so that is still my bet on the morning. Retest of Wednesdays low and we need to see the SPX and Nasdaq on the same page.
The NQ did test the weekly pivot at 1603.75, the ES did not see 980 weekly. In general when the markets are this split and one tests and the other doesn’t, that becomes less of a magnet to pull us. Doesn’t mean we won’t see the ES test, but isn’t as strong of a pull with the NQ being the one there first. Thursday look for the range to expand, a break of the lows would be what we need to see without a later day reversal. That would pull us in and create buying opportunities.
Economic data for the week (underlined means more likely to be a mkt mover): Thursday 8:30 Unemployment Claims, 10:30 Natural Gas Storage. Friday 8:30 Non Farm Employment Change, 8:30 Unemployment Rate, 8:30 Average Hourly Earnings, 3:00 Consumer Credit.
Some earnings for the week (keep in mind companies can change last minute: Thursday pre market AES, EAT, CMCSA, CTB, DSX, EP, FTO, KG, MMS, PCS, NDAQ, OMG, WEN, WMB, and after the bell ACS, AIG, BZH, NILE, CBS, CHINA, CROX, ELX, HANS, MXIM, MCHP, NGS, NVDA, THS, VRSN, WTW. Friday pre market BECN, CEP, SUP and nothing after the bell.
ES (S&P 500 e-mini) Thursday’s pivot 998.50 weekly pivot 980, monthly pivot 947. Intraday support: 1000.50, 997.5-995.75, 990.50-989.75, 986.50, 981.75, 979.50. Resistance: 1003, 1007, 1009.75-1010, 1016.50
