STTG Market Recap May 19, 2014

Monday saw a reversal of fortune of sorts as the type of names bloodied over much of the past 2 months did the leading while the more slow growth fare lagged.  The S&P 500 ended up 0.38% and the NASDAQ 0.98% after both indexes opened slightly in the red.  There was no major economic news on the day.

The NASDAQ is back to a key area – that downtrend line than connects highs of the past few months; the last visit here led to an immediate rejection.  If you are bearish you can place a short against the index in this general area with a top above the trend line.  For the more intermediate term bulls want to see the top dotted line broken to the upside to signify a new high in the index.



A mega merger between AT&T (T) and DirectTV (DTV) was the news of the day – unfortunately for us consumer it will lead to less competition which one used to think was a key to the American economy; now it seems having mega companies  and less competition is a national goal.  If you are a cynic you’d wonder if the news leaked out more than a week ago by the way the stock moved…

Shares of AT&T slumped after the telecom company launched a $48.5 billion bid for satellite TV operator DirecTV on Sunday. The deal comes as Comcast awaits regulatory approval of its $45 billion bid for Time Warner Cable.


Apple (AAPL) made another attempt at breaking out of a high level flag, so we’ll see if this one fares better than the last attempt.  This is always an easy trade; you buy on the breakout and stop loss if it returns into its flag.


Goodrich Petroleum (GDP) is in a more traditional flag pattern – it announced very good results from a new well mid April and exploded higher – it has spent the past month consolidating those gains and as of Friday began a breakout which followed through nicely today.


Zillow (Z) is an incredibly volatile stock intraday but relative to a whole host of other internet type stocks which have been crushed the past 2 months it has shown a lot of relative strength.  So if the NASDAQ can finally recover and begin making new highs this looks like a potential leadership stock.


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