STTG Market Recap December 31, 2013

2013 came in like a lion, and out like a lion.   Seems only fitting we finish off the year  with a positive day as it ended as one of the best years in the past few decades; a buying spree in the last hour of the day pushed indexes to their highs.  The S&P 500 gained 0.40% and the NASDAQ 0.54%.  Stocks gapped up at the open and came back to about where they opened before that rally in the last hour.  There were 3 economic reports on the day:

The Conference Board's index of consumer confidence climbed to 78.1 in December from 72 in November. Analysts expected a December reading of 76.  The S&P/Case-Shiller home price index rose 13.6 percent in October from the year earlier period.  The Institute of Supply Management's Chicago purchasing manager's index fell to 59.1 in December from 63.

After 2 days of rest, the NASDAQ ramped right back into the top of this channel we have been highlighting all year.

nasdaq

Usually we focus first on the S&P 500, but the NASDAQ chart has just been in a much easier to see pattern.   The S&P is quite overbought as it is nowhere near even the 10 day moving average.

spx

We'll look at some less popular names versus the usual suspects today using Marketsmith

One area we have highlighted a few times in 2013 has been the refiners - their input cost (mostly oil) has been relatively steady for the entire year, and there has been a lot of industry consolidation over the past few years much like the airlines.  Yesterday, Berkshire Hathaway bought a unit of Phillips 66, which seemed to add some excitement to this group which had been consolidating nicely after a big run earlier in the fall.

mpc vlo

Semiconductors have been a strong group of late and some individual names not as well known to the public have excellent charts.  Below are Himax Tech (HIMX) and Ambarella (AMBA); the latter is especially overbought but you can see how strong these patterns are.  AMBA broke out of a range 7 days ago and sometimes you get very powerful moves from those breakouts.  HIMX broke out 5 weeks ago on strong volume and has not broken its 20 day moving average since.

HIMX  AMBA

E-House Holdings (EJ) is another strong pattern - this is a Chinese real estate company.  You can see Investors Business Daily has a 99 relative strength reading and it has support at the 20 day moving average in green the last 5 weeks.

EJ

It is difficult to be a bear in this environment but if one insists here is a list of 5 things that can go wrong in 2014 per CNBC.

Thanks for hanging out with us in 2013, we hope our charts helped you stay mostly bullish in a year that called for it, and we'll see you back here Thursday to kick off what will surely be another exciting year in 2014.