Wednesday closed the day in the red across the broader markets. Volume once again came in for a distribution day. That is two consecutive distribution day’s and four in the last eight trading days. The TRIN closed very low at .53 and the VIX at 35.32 mid range. That TRIN is very low for the losses the market had and given the mid level close tells us the selling had some buying mixed in there. Gold closed down $20.60 to $1194 and oil up 46 cents to $69.87 a barrel.
Into Thursday with the neutral close the market had with the spinning tops giving the market a rest day. The indexes closed and tested the gap support that was left open from the 7th. The SPX also fell into the 200dma and held that support. Retesting that drop on the 6th and 7th and holding that support is good for the market. Now it could also be a digestive pause, but the support held on the first test and pulled off the lows nicely. With the low TRIN I am not overly bearish with this drop and a little suspect of what we’ll see. With the SPX getting to the 200dma before the Nasdaq or Dow, the market could very well find some buyers.
The Senate did not get a vote to move forward with the FINREG, which I think is a good sign for financials. We’ll see if they find some relief early Thursday. HPQ held up well despite the rest of the big cap tech stocks closing red. That too can lead to some positive catch up movement. Semiconductors did close green on the day which is also optimistic. Now don’t think I’m buying with two hands, I’m just not shorting quickly into Thursday. The market is holding ground and it was a digestive day after a reversal day Monday, trend day Tuesday, we deserved that today with some zigzag action.
Early data Thursday will likely create some nice movement and a bracket of Wednesday’s range will let the market look for continuation into the second half of the week. The ES needs to hold over 1100.25 and the NQ over 1848.50 to hold the support. The SPX at 200dma 1102.16 is also a line in the sand for the market. A drop there would likely accelerate the market to test the lows from the May 6th drop.
Economic data for the week (underlined means more likely to be a mkt mover): Thursday 8:30 Unemployment Claims, 10:00 Philly Fed Manufacturing Index, 10:00 CB Leading Index, 10:30 Natural Gas Storage, Friday 7:00pm FOMC Member Dudley Speaks
Some earnings for the week (keep in mind companies can change last minute: Thursday pre market PLCE, CSC, DLTR, GME, ROST, SPLS, TGT, TTC, WSM, and after the bell BRCD, DELL, GPS, INTU, MRVL, SHLD, SKIL, WTSLA. Friday pre market ANN, HIBB and nothing after the bell.
ES (S&P 500 e-mini) Thursday’s pivot 1110.50, weekly pivot 1143.75. Intraday support: 106.25, 1103, 1100.25 61.8%-1098.75, 1090, 1081 78.6%. Resistance: 1117.50, 1123.25, 1126.75, 1135-1137, 1144, 1147.50-1148.50, 1150.50
