Wednesday closed the day with big gains across the broader markets. Volume came in heavy to leave accumulation days on the NYSE and Nasdaq. JP Morgan (JPM) came in with nice earnings to follow Intel leaving the market with a very bullish tone throughout the day. The Dow closed over 10,000, the Nas Composite and S&P 500 also closed at new highs on the year. The Nas 100 moved through the 2009 highs, but didn’t close over that prior high. The TRIN closed at .41 and the VIX at 22.86 about 9% off the 10dma. Gold closed down 40 cents at $1064.60 and oil up $1.00 to $75.15 a barrel.
Daily charts on the Nas 100 and the Nas Composite the hanging man candle closed into the upper Bollinger band, Stochastics at 90 and touching (no cross down yet), CCI is only 144, RSI at 67. SPX and Dow are into the upper Bollinger band with a very impulsive candle (marubozu) on the day. The Stochastics are up into the 90’s and coming together, CCI Is over 100 line resistance and RSI 67 with a flat MACD. 65 minute on each index is extended into overbought territory. The market has been very digestive after the first hour and moves sideways to follow, with some movement into the final hour.
Thursday more earnings to help set the days tone and market moving economic data will be out throughout the morning. The overbought conditions will need to digest or pullback, another gap up would be very extreme in this market. However, if GS comes in with good news that is likely to be what we see. I have concerns about a sell the news setup off GS into Thursday to let the market pullback. That could come off the opening and then let the market resume the upside. A close over Wednesdays highs would be very bullish and push the market along nicely with new participation. A close under Wednesday’s highs will cool the bulls jets for awhile and let the market come back and fill some of the open gaps.
Economic data for the week (underlined means more likely to be a mkt mover): Thursday 8:30 Core CPI, 8:30 Unemployment Claims, 8:30 CPI, 8:30 Empire State Manufacturing Index, 10:00 Philly Fed Manufacturing Index, 10:30 Natural Gas Storage, 11:00 Crude Oil Inventories. 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.
Some earnings for the week (keep in mind companies can change last minute: Thursday pre market BIIB, SCHW, CIT, C, CY, GS, NOK, LUV, WGO and after the bell AMD, GOOG, IBM, NVLS, PMCS. Friday pre market BAC, GE, HAL, MAT and nothing after the bell.
INDU (Dow) closed +144.80 at 10015.86. Support: 9946.49, 9896.30, 9860.57, 9799.43. Resistance: 10095, 10157.30, 10178, 10219.50