Daily market commentary for Tuesday, February 6, 2007
Written By: Teresa Appleton Stock Forum ID: Teresa
Monday left red on the Nasdaq 100, Nasdaq Composite and the S&P 500, however the Dow remained green on the day. All four broader indexes traded in a narrow range and lighter volume was seen on the NYSE, but slightly higher on the Nasdaq. Stock index futures volume was anemic and the lowest we’ve seen since the week after Christmas. Safe to say that is horrid! It made for extremely choppy movement and really only the Russell moved, but that too was choppy.
Gold rallied while the dollar fell today. Gold closed up $4.60 to close at $656.10. Crude didn’t share the strength in gold, closing down 28 cents at $58.74. We did see the contract near $60 (59.95) to fall quickly giving the red close. Natural gas received a 2.1% boost off the East coast cold weather front. I think we will see crude bounce around 55.00-60 for awhile to keep just enough volatility, but until supplies change drastically there isn’t any REAL pressure on demand, it is all just expectations.
Going into Tuesday I will expect a quiet morning with Fed Chairman Bernanke speaking at 1:30. All eyes or I should say all ears will be on what he has to say. I have been looking at different market correlations on leading indicators, sector rotations and all that “stuffâ€. Economic data may influence and impact our movement, but the reality is every piece we see is a lagging indicator. It is all we have, so we have to use it and IF Bernanke would give any information on what he sees going forward that would be bigger than any release we see. So we can HOPE he’ll say something worthwhile.
Tuesday we need to find a break in this multi day consolidation narrow range mess. Downside is still very possible as we continue to see small divergences and a range bound market. I do not feel we will free fall, so don’t put on those bear suits yet. I just see some area’s of weakness and more divergence giving us every reason to pullback and refuel. Volume has been light enough for days now to drop us under the 50 day moving average, so something has to give sooner rather than later.
Economic Data for the week of February 5-9: Tuesday no data is due out, 01:00 Chi Fed Reserve Bank Pres Moskow to speak, 01:30 Federal Reserve Chairman Ben Bernanke to speak, 03:30 SF Fed Reserve Bank Pres Yellen to speak, Wednesday 08:30 Productivity Prel, 10:30 Crude Inventories, 15:00 Consumer Credit, Thursday 08:30 Initial Claims, 10:00 Wholesale Inventories, 10:30 Natural Gas Inventories, 12:00 Chain Store Sales, 04:30 Money Supply, Friday no data is due out, 08:45 St Louis Fed Reserve Bank Pres Poole speaks, 01:00 Dallas Fed Reserve Bank Pres Fisher speaks.
Some earnings for the Week: Tuesday pre market AVP, DUK, ELNK, IACI, MYGN, TYC, and after the bell AVNX, BBBB, CELL, BRKS, BOBJ, CAKE, CSC, XRAY, IPAS, LNC, PLNR, TZOO. Wednesday pre market ACS, APOL, BCRX, CI, ICE, OSIS, RL, SKYW, WHR and after the bell AFFX, ACL, ALKS, EQIX, MXIM, OIS, PACR, PRU, SCSS, SINA, SNIC, ULTI, UTI, DIS. Thursday pre market AET, LNT, UHAL, CSK, DO, DJO, ESRX, FLIR, HNT, LVLT, MAR, MLM, MMS, MDTH, MLNM, PENN, PEP, Q, TBL, TOL, WLT, WMG, WMI and after the bell ANDE, BMC, BRCM, ELY, DRIV, ENER, GTW, LPNT, MFE, NAPS, PNRA, TQNT, UNTD. Friday pre market AG, CVH, HAS, MA, QMED, WY.
ES (S&P 500 e-mini) Tuesday’s pivot is 1452.00, the weekly is 1443.75. The 60 minute chart below you can see on the CCI it is a possible head and shoulders, this would indicate lower. We are still watching for a move down to the 0 line on the CCI, however today we saw it move up to 100 line, we need rejection there and a move back to 0 or this will void the pattern. Today’s test of Fridays highs still did not catapult us into higher ground. I still see divergence on the dailies and that should find a pullback and range expansion for us. It has been very rare over the past two months to not test the weekly pivot on Monday, the few times we have not tested it on a Monday we’ve seen it on Tuesday. This would give us the perfect pullback and enough fuel to recharge the bulls batteries. So we’ll keep an eye on that, I don’t see us staying up here, but a move up into 1455-1456 still seems needed to exhaust this. So a little higher is not out of the question for me still. Intra day support: 1451, 1449.25, 1446.25, 1444- 1443.50 (gap fill), 1441.25. Resistance to look for: 1455, 1456, 1457.50, 1458.75, 1461. 60 minute chart is below.
