STTG Market Recap August 22, 2014

The recent switch back to bull market mode continues as we are working off overbought conditions but via a pullback but sideways action.  No comments out of either Janet Yellen of the Federal Reserve nor Mario Draghi of the European Central Bank moved the market much at all, and at the end of the day we had a 0.20% drop in the S&P 500 and a 0.14% advance in the NASDAQ.   Right now it seems like it will take a return of increased geopolitical tensions to push the market back off kilter.

The Federal Reserve should move cautiously in deciding when to raise interest rates given the U.S. labor market remains bruised from the Great Recession, Fed Chair Janet Yellen said on Friday amid calls from policy hawks for a near-term rate hike.  In a speech at the Fed’s annual central bank conference, Yellen laid out in detail why she feels the unemployment rate alone is inadequate to evaluate the strength of the jobs market and why the central bank needs to step gingerly.

Her remarks were followed by a speech by the head of the European Central Bank, Mario Draghi, who said the ECB was ready to use all the tools at its disposal to lift euro zone inflation if it continued to drop. He said, however, that most factors that had weighed on prices appeared temporary.

Indexes remain fine – a move upward by the 10 day moving average would be helpful to help catch up to the actual index prices.

spx nasdaq

And this is how you work off short term excess in a bull market – you chop off nearly 20 pts off the NYSE McClellan Oscillator via a tiny 0.20% pullback in the index.

nymo

Keurig Green Mountain (GMCR) jumped after the K-cup coffee-pod maker said it had inked a deal to make and sell Kraft Foods Group Inc’s coffee.

gmcr

LinkedIn (LNKD) surged after about a week of consolidation allowed the 10 day moving average to catch up and provide a floor.

lnkd

Airlines continues to “luv” the drop in oil – pun intended.  That said, stocks like Southwest Airlines (LUV) are a bit overdone short term.

luv

Fun factoid – there are 27 cities in America where you can get ridiculously fast internet speeds – CNNMoney.com tells us where they are.

Have a good weekend and we’ll see you back here Friday.

 

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