STTG Market Recap August 4, 2014

Stocks flip flopped in the morning Monday around unchanged but rallied throughout the afternoon as an extreme short term oversold condition we noted Friday was worked off.  It is nothing to get excited about yet if you are a bull – in fact we noted there should be a short term rally coming due to how oversold the indexes had been and if you are a short/intermediate term trader that rally would be a place to lighten up until we see some better signs in the market.   The S&P 500 and NASDAQ both gained 0.72%.   Participants were happy when hearing of Portugal’s plans to spend 4.9 billion euros, or $6.58 billion, to bail out Banco Espirito Santo.  Tomorrow eyes will be on the ISM Non Manufacturing report in the morning.

We took some damage on the indexes last week so aside from a short term bounce that the NYSE McClellan Oscillator told us was very likely there is not much to do – if you are a long term investor nothing to see here; for the short and intermediate term folks you have some decisions to make as the outlook now is muddled in the near term.

spx nasdaq

Here is that NYSE McClellan Oscillator – we got the rare break into the -90ish range which is a great place to make a quick and dirty short term long trade.  We are still oversold by most measures so we’ll see if we can get back above the -40 area this week.

nymo

Warren Buffett’s Berkshire Hathaway (BRKb) gave the S&P 500 its biggest boost. The company said late Friday that its second-quarter profit soared 41 percent to a record.

brkb

Michael Kors (KORS) – which was actually a momentum stock not too long ago much like Lululemon (LULU) declined after the handbag maker reported better-than-expected results, but said its profitability would fall in 2014.

kors

Outside of social media/internet/Apple there are not a lot of great charts to show you right now as quite a few names took some technical damage last week.    We mentioned Friday how Facebook (FB) “filled the gap” in it’s chart leaving an easy (if aggressive) entry point – Chinese internet giant Baidu (BIDU) is so strong it did not even bother to fill its gap despite an almost identical short term chart.

fb

bidu

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Comments

  1. Folker says

    Dear Blain,

    also the Statement “Outside of social media/internet/Apple there are not a lot of great charts to show you right now as quite a few names took some technical damage last week. ” is of great help.

    Thank you.

    Regards,

    Folker