Will Wednesday start to wind down the markets high altitude momentum?
Tuesday closed with another narrow range day, but our volume increased to give us an accumulation day on the Nasdaq. The Nasdaq and Dow closed green, but the S&P 500 struggled and slid into red due to weakness in the banks, brokers and healthcare, leaving a distribution day. Crude fell on the day down $1.31 to close at $64.58 a barrel. Gold also came down today to close at $687.70 -$6.50 on the day.
A strong tech sector managed to rebound the market off of weak Consumer Confidence and Housing data. While telecom faltered with financials, the semi’s rallied to May 2006 levels. Hardware and Software sectors did not participate in the semi’s rally. After the bell Amazon surprises with stunning earnings to break $50.00, levels the stock has not traded at since July 2004. The semi’s were the star performers today with interspersed pockets of strength by stocks like Apple, IBM, all having enough strength to keep the market up today.
Going into Wednesday economic data will continue to be center stage staggered throughout the day and Fed Chairman Bernanke will be under the spotlight as well. We closed the Nasdaq with some small signs of divergence. This along with a falling VIX will leave us with more of a neutral bias into Wednesday. The last two hours it was very evident the Nasdaq was running out of fuel and could not find its rally momentum. Along with that the Dow managed to elude the 13,000 mark again today, with 15 of the 30 stocks red the performance was still strong. Just not enough to get that psychological level. The banks breaking the 50dma should be watched closely into Wednesday. The break was not significant and Wednesday’s action will either confirm the break or pull the sector back above that key level. Earnings pick up into Wednesday and Thursday along with the economic data. Don’t forget GDP on Friday is still on the horizon Friday.
Economic Data for April 23 – 27 Wednesday 08:30 Durable Orders, 08:30 Core Durable Goods Orders, 10:00 New Home Sales, 10:00 Fed Chairman Bernanke Speaks, 10:30 Crude Inventories, 12:30 Fed Governor Mishkin Speaks, 02:00 Fed’s Beige Book, Thursday 07:30 Fed Reserve Bank Pres Yellen speaks, 08:30 Initial Claims, 10:00 Help Wanted Index, 10:30 Nat Gas Inventories, Friday 08:30 GDP-Adv, 08:30 Chain Deflator Adv, 08:30 Employment Cost Index, 10:00 Mich Sentiment Rev.
Some earnings for the week: Wednesday pre market EYE, AMG, APU, ATMI, BHI, BA, COP, GLW, EXC, FCX, GD, GENZ, ISE, LPX, NSC, OSTK, PFCB, R, TASR, TIN, UAUA, UPS, WLP, XTO and after the bell AFFX, AKAM, ACL, AAPL, BOBJ, CTXS, FFIV, FISV, HLIT, LSI, MXIM, MTH, MIPS, PMCS, PHM, QCOM, RMBS, RYL, VARI, VAR, WEN, XLNX, ZMH. Thursday pre market MMM, AET, BZH, BMY, CAH, CRA, CFC, CY, DO, DOW, DSPG, XOM, F, HAL, HET, IMCL, LVLT, ERIC, MHO, MESA, MEH, MNST, MPS, NCR, NEM, NYX, HOT, SU, SPWR, TSM, TRA, LCC, VLO, XMSR, ZOLL, and after the bell ACTU, BIDU, BRCM, DECK, DRIV, BOOM, ELX, KLAC, LSCC, LPNT, LAVA, MFE, MCHP, MSCC, MSFT, ONNN, OSIP, RACK, RADS, SNDK, SWIR, SOHU, SYNA, ULTI, UHS, VSEA, VLCM, YRCW. Friday pre market AT, CVX, CVH, CMI, FLIR, IR, GAS, ZEUS, OCR, SPG, SSCC, TOMO, VMSI, WMI and after the bell CCJ, GHCI, MSTR.
BKX (Banks) closed -.43 at 115.74. Support: 115.28, 114.58, 113.81 200dma. Resistance: 115.88 50dma, 116.08, 116.64, 117.03. Daily chart below
Tuesday presented its own challenged with stocks, but Futures reminded me how fun but at the same time keep you on your toes trading can be. So lets look for Wednesday to bring in even more twists and turns and movement.
