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主题：04/13/2009 Market View -- 宁子
家园 04/13/2009 Market View SUMMARY:
- Financials, commodities jump by themselves, waiting on techs, chips to react.
- Economic data to pick up the pace a bit but earnings are garnering the attention.
- Goldman announces early behaves well considering a $5B stock offering.
- Indices holding gains into earnings, looking for a new spark to take on next resistance. We will see if GS can drive stocks further into earnings season.
Market gets support from financials, commodities until others come to their aid.
Monday the financial stations were pretty desperate for news. Many foreign markets were closed and thus there was just not a lot to excite investors. ESRX and WLP announced the former would purchase NetRx for almost $5B; not a small deal but the reaction was almost 'so what?' outside those two companies. STX increased its revenue forecast but it did nothing. The bank stress tests are underway, but that didn't seem to bother the financials. It is as if the stress test is pass/fail with 50 being pass. Not a lot of worries there. You want to know how slow things were? YHOO and MSFT and their partnership/joint venture/buyout were back in the headlines. You know someone pulled that out of the 'use in case of a slow news day' file to fill out the morning hour.
Stocks opened lower overall and traded lower into midmorning. Our midmorning alert noted this time was often the fulcrum for a new intraday move and that turned out to be the case. Often when the first move is countertrend the midmorning period will lead to a turn back to the prevailing trend. Monday held true to that as financials and commodities reversed off the early lows and moved higher to positive ground. Mid-afternoon the indices broke the prior session highs (another way of saying they turned positive) as the techs, chips, industrials and other sectors recovered as well.
Looked pretty decent until the last 15 minutes when the bids were pulled and the indices slid back to mostly flat. Volume was very light; it was easy to push the indices around. All in all, however, it was a decent session as stocks held the Thursday gap gains as a result of the WFC earnings pre-announcement. To hold gains post-Friday holiday, coming back from negative, is not bad action. Not convincing in itself, but it shows the continued market resilience, that old upside bias in the lack of any major driving force.
TECHNICAL. Intraday the action was low to high with a turn positive though some late weakness pushed the NYSE indices sans SP500 back to negative. SOX never made it to positive on the session though it put in the effort. When techs and chips get back into the game similar to a couple of weeks back the action could be explosive once more.
INTERNALS. Breadth was so-so but it was also positive, not bad for a negative to positive/flat reversal session. Would have been hard to keep up the 6:1 pace from Thursday. Volume was quite weak yet again. Thursday trade spiked on the WFC news (though NASDAQ remained low overall), but Monday it was back down to last week levels, i.e. below average. That shows fewer players in the market right now. There was no distribution on the early selling, but there was also no accumulation on the later upside. Just another low volume session that doesn't tell you a whole lot about renewed strength or weakness given the numbers were low, but it does show the upside bias remains as stocks did recover to positive (for the most part) off the lows.
CHARTS. Up and down action, but no relative change after last Thursdays gap higher and taking on or taking out next resistance as the case may be. NASDAQ is still over the January close as is NASDAQ 100, and SOX is still holding over the November high. SP500 remains just below the twin January/February twin peaks at 875. That is of course next resistance after 850, but there is a range of resistance from 875 to 920, then 950. Right now SP500 is at a key level, the October lows at 850; yes it is over those levels as of the close but it is not a done deal so to speak. There is a moving average crossover, i.e. the 18 day EMA crossing up over the 50 day EMA. That is a good intermediate trend confirmation, but the overall trend on SP500 is still down and there is still a lot of overhead to bust through. Why so much on the SP500? Because the financials were the albatross around the market's neck from September to March. Their recovery has coincided with the market's recovery. Techs and chips are very important and industrials show faith in the future, but they could not do it alone.
LEADERSHIP. Key financials were up again (e.g. MS, GS, JPM) though indeed most financials were up, key or not. Steel and copper continued their moves, pulling most of the related stocks with them. China stocks surged (e.g. SINA, SNDA). Technology and chips lagged, but they came back nicely off the early selling. Leadership is as leadership often is in upside moves: some sectors are moving well while others take a breather and others continue working on their bases, getting ready to join the action. As noted above, if the techs and chips get back in the game again the move can be explosive as it was a couple of weeks back.
家园 THE ECONOMY A slow Monday with no scheduled data, and with earnings announcements and pre-announcements here the focus is not so much on the economic data. It is not worthless, it is just running in the pack with other data, namely earnings.
The general idea we hear on the financial stations is that the economy is getting better. We have chronicled the improvement in several categories the past three months, e.g. regional and national manufacturing, same store sales, factory orders. The fact that they are touting improvement is enough to worry you as to whether this is just a short term blip improvement or something more sustainable. The fact that the data is coming in from many different areas and showing some improvement gives you more comfort. Still . . .
The best indicator is the market. Right now it is trending higher off the bear market lows, but it is still an intermediate trend for the NYSE indices as they have not made higher highs yet. Thus even with the financials joining the move the past 4 weeks it is still not enough to drive their indices to new post-low highs similar to NASDAQ, NASDAQ 100, and SOX. The indices are moving better to the upside, some key moves have been made as noted (NASDAQ, etc.), and there is improvement in the data as noted. The data is helping confirm the stock market move, but beware as neither are all that strong right now. We take what the market gives but we also note what the market is telling us. It is up but the indices with most of the financials in them are still in overall downtrends.
家园 THE MARKET MARKET SENTIMENT
VIX: 37.81; +1.28. Last week VIX broke below 40, a support point over the past four months. There is the January low at 36.88 that it cracked on the Thursday low (36.53) before a modest bounce Monday. A test of 40 and a failure would be bullish for equities near term. Remember, VIX did its job back in October and November. As is almost always the case, the peak came a few months before the market actually found its bottom.
VXN: 39.34; +1.11
VXO: 39.09; +1.68
Put/Call Ratio (CBOE): 0.67; -0.14
Bulls versus Bears:
This is a reading of the number of bullish investment advisors versus bearish advisors. The reason you look at this is that it gives you an idea of how bullish investors are. If they are too bullish then everyone is in the market and it is heading for a top: if everyone wants to be in the market then all the money is in and there is no more new cash to drive it higher. On the other side of the spectrum if there are a lot of bears then there is a lot of cash on the sideline, and as the market rallies it drags that cash in as the bears give in. That cash provides the market the fuel to move higher. If bears are low it is the same as a lot of bulls: everyone is in and the market doesn't have the cash to drive it higher.
This is a historical milestone in the making. Bulls are impressively low considering we are in general a very optimistic country. The few bulls is a positive indication because it means most everyone that is getting out is out and there is money on the sidelines. In other words the ammunition boxes are full and as the market recovers investors will start opening up the boxes and firing. Little by little they will be forced to put more money into the market and there will be some rushes higher in fear they are missing the train. You relish times when sentiment is so negative because it means some tremendous buys are setting up. This could indeed be the opportunity of a lifetime, and you take advantage of it by buying quality stocks and letting them work for you as long as they will. If we can hold them for years, great.
Bulls: 36.0%. Sharp jump in the bulls, moving back above 35%. Below 35% is a bullish indication. Above is not so bullish but is not bearish until higher levels. 31.0% the prior week up from 28.9%. Still well below the 43.0%, the prior top of the recovery as the market rallied off the November low. Bullishness bottomed on this leg lower at 21.3% in November 2008. This last leg down showed us the largest single week drop we have ever seen, falling from 33.7% to 25.3%. Hit 40.7% on the high during the rally off the July 2008 lows. 30.9% was the March low. In March the indicator did its job with the dive below 35% and the crossover with the bears. A move into the lower 40's is a decline of significance. A move to 35% is a bullish indicator. This is smashing that. For reference it bottomed in the summer 2006, the last major round of selling ahead of this 2007 top, near 36%, and 35% is considered bullish.
Bears: 37.1%. Fewer bulls but not a commensurate fall compared to bulls and their rise (38.0% last week). Big drop from 43.3% and 44.3% before that. The decline was slowing its fall from 47.2%, the peak for the run this year but no more. Hit the 34's on the lows, falling from 38.5% and 46.2% in mid-December. Still above the 35% level considered bullish for stocks. Bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment on this move. 35% is the level that historically indicates excessive pessimism. As with the bulls the jump in bears did its job after hitting 44.7% in the third week of March. Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). This is a huge turn, unlike any seen in recent history.
NASDAQ
Stats: +0.77 points (+0.05%) to close at 1653.31
Volume: 1.779B (-15.24%). Low trade again as NASDAQ bumps the January intraday peak. Low volume all month outside the start. Techs are going up but not as many players in these stocks. That can lead to failure if the participants come back in as sellers. Solid volume to start the move then tapering the past few weeks. Some caution is appropriate.
Up Volume: 856.603M (-1.123B)
Down Volume: 906.422M (+715.292M)
A/D and Hi/Lo: Advancers led 1 to 1
Previous Session: Advancers led 4.8 to 1
New Highs: 26 (+1)
New Lows: 11 (+4)
NASDAQ CHART: http://investmenthouse.com/ihmedia/NASDAQ.jpeg
Gapped lower, sold to the early April peak, then rebounded to close just a fraction over the January closing high. That still leaves NASDAQ below the January intraday peak and that shows a potential double top in the move. NASDAQ just started a new attempt at the second leg of the rally and that makes this a true test of what NASDAQ has in the tank right now. Good support at 1598 gives it a safe harbor as it tests this next resistance level. The light volume is a concern along with the January peak. Techs have been noncommittal of late and perhaps we see them re-engage and send the entire market higher. Keeping the stops reasonable and a bit tighter on the short term positions (options) given these two factors.
SOX (-0.96%) was down all session but it showed solid action. Gapped lower, sold to the 10 day EMA on the low, then rebounded nicely. The rebound shows the buyers coming back in and pushing SOX back up to the April peak and that keeps it over the November peak. SOX still looks solid but it is suffering a bit of sluggishness here as the 200 day SMA is pushing down on it and exerting a little bit of downside force.
NASDAQ 100 CHART: http://investmenthouse.com/ihmedia/NASDAQ100.jpeg
SOX CHART: http://investmenthouse.com/ihmedia/SOX.jpeg
SP500/NYSE
Stats: +2.17 points (+0.25%) to close at 858.73
NYSE Volume: 1.481B (-19.32%). Volume fell back below average after the big Thursday surge. As with NASDAQ, volume-light is the mode of late though the big upside days have come on big volume.
Up Volume: 1.014B (-698.318M)
Down Volume: 460.603M (+345.049M)
A/D and Hi/Lo: Advancers led 1.53 to 1
Previous Session: Advancers led 5.94 to 1
New Highs: 8 (-6)
New Lows: 73 (+9)
SP500 CHART: http://investmenthouse.com/ihmedia/SP500.jpeg
Rallied a bit higher intraday toward the late January and February peaks at 877 (864 on the high) and could not make further headway. While it could not make that new break it did rally back from negative as the buyers pushed SP500 back up to positive. Good intraday action showing the buyers that are in the market are in control, but lower overall volume shows there are fewer players here at key levels. As with NASDAQ, SP500 is moving nicely but some caution is warranted
SP600 (-0.07%) held steady Monday after the Thursday surge. It made it to the November/January down trendline that is currently coincident with the late January and early February highs. Over the October low and below the 250 resistance. A good point to take a step back then a new run.
DJ30
DJ30 jumped nicely off the 10 day EMA Thursday but went nowhere Monday. Familiar rebound off the intraday low that tested 8000ish and the 90 day SMA. It is bumping the October closing low at 8175. After a couple days of this kind of action it should be in position to make a run at that resistance.
Stats: -25.57 points (-0.32%) to close at 8057.81
Volume: 424M shares Monday versus 462M shares Thursday. Not bad trade at all, particularly compared to the other exchanges.
DJ30 CHART: http://www.investmenthouse.com/ihmedia/DJ30.jpeg
家园 TUESDAY GS was the news after hours with its early earnings release that crushed expectations at $3.39 versus $1.60. The problem for GS was the $5B stock offering; that is a big wad of new stock and the dilutive effect may have been what was holding GS down a couple of clicks after hours.
There is a lot of talk on the financial stations about the upside running out of steam. It may be the case as DJ30 is not a picture of strength, but there are other indices that are very solid, e.g. SOX, NASDAQ, NASDAQ 100. SP500 even looks pretty good despite the resistance. It has a lot of overhead to deal with but perhaps GS can give the financials another reason to rally, and if the techs and chips get back in we get another nice run.
That is what we of course want to see on into the next week or so of earnings season as it gives our positions a nice ramp higher and we can use that to lighten up as the earnings news gets saturated and unable to push stocks higher in the event they remain positive as they have been thus far (RIMM, WFC, BBBY, and now GS).
The big issue is whether we continue to add positions at this point or just ride what we have higher? As noted above there are always new leaders coming to the fore when the market rallies well. Thus we took some positions Monday in for example DE as it tested back some after starting to move higher this month. V broke sharply higher after testing its break over key resistance. They are moving up as others test and rest. That is how the market rotates money and maintains its strength.
Thus we will take new opportunity as it arises as well as add to good positions we have that are in position and continue to show strong upside attributes, but we also know that earnings could go south (WFC, GS and other financials may be aberrations the rest of the economy cannot duplicate given their low or no cost access to cash to lend) or just run out of ability to drive stocks higher.
What we do is keep picking good stocks ready to move and in good position to move without loading up the boat and at the same time take gain on positions we currently have as they put in good moves. The move is a bit old and it has some serious resistance on SP500. That doesn't mean it stops in its tracks, but the risk/reward position overall is not as good as it was. Thus pick stocks in good position to move that have already announced earnings or have earnings announcements 3 to 4 or more weeks away. That does not totally insulate them from the overall market but it helps as we want to keep active as long as the move continues higher. The reason: no matter what all of us think the market is going to do, it is going to do what it wants. That may just mean it continues rising farther and longer than most everyone thinks it can. That is how the market usually works.
Support and Resistance
NASDAQ: Closed at 1653.31
Resistance:
The January closing peak at 1653 (intraday)
1666 is the intraday January 2009 peak
1780 is the November 2008 peak
1947 is the October gap down point
Support:
1644 from August 2003
1623 is the April peak
1620 from the early 2001 low
1603 is the December peak
1598 is the February 2009 peak, the last peak NASDAQ made
The 10 day EMA at 1594
1587 is the March 2009 high is getting put to bed again
1569 is the late January 2009 peak
1542 is the early October 2008 low
1536 is the late November 2008 peak
1521 is the late 2002 peak following the bounce off the bear market low
The 50 day EMA at 1514
1505 is the late October 2008 closing low.
1493 is the October 2008 low & late December 2008 consolidation low
The 50 day SMA at 1481
1440 is the January 2009 closing low
S&P 500: Closed at 858.73
Resistance:
857 is the December consolidation low; cracking but not broken
866 is the second October 2008 low
878 is the late January 2009 peak
889 is an interim 2002 peak
896 is the late November 2008 peak
899 is the early October closing low
919 is the early December peak
944 is the January 2009 high
Support:
853 is the July 2002 low
848 is the October 2008 closing low
846 is the April peak
839 is the early October 2008 low
833 is the March 2009 peak
The 10 day EMA at 831
The 90 day SMA at 827
818 is the early November 2008 low
815 is the early December 2008 low
The 50 day EMA at 808
805 is the low on the January 2009 selloff. KEY Level
800 is the March 2003 post bottom low
768 is the 2002 bear market low
752 is the November 2008 closing low but it is not broken and done away with
741 is the November 2008 intraday low
Dow: Closed at 8057.81
Resistance:
The April peak at 8076
8141 is the early December low
8175 is the October 2008 closing low. Key level to watch.
8197 was the second October 2008 low
8375 is the late January 2009 interim peak
8419 is the late December closing low in that consolidation
8451 is the early October closing low
8521 is an interim high in March 2003 after the March 2003 low
8626 from December 2002
8829 is the late November 2008 peak
8934 is the December closing high
8985 is the closing low in the mid-2003 consolidation
9088 is the January 2009 peak
Support:
The 90 day SMA at 7974
7965 is the mid-November 2008 interim intraday low.
7932 is the March 2009 peak
7909 is the early January low
The 10 day EMA at 7885
7882 is the early October 2008 intraday low. Key level to watch.
7867 is the early February low
The 50 day EMA at 7718
7702 is the July 2002 low
7694 is the February intraday low
7552 is the November closing low. KEY Level.
Economic Calendar
These are consensus expectations. Our expectations will vary and are discussed in the 'Economy' section.
April 14 - Tuesday
PPI, March (8:30): 0.1% expected, 0.2% prior
Core PPI (8:30): 0.0% expected, 0.1% prior
Retail sales, March (8:30): 0.3% expected, -0.1% prior
Retail ex-auto (8:30): 0.0% expected, 0.7% prior
Business inventories, February (10:00): -1.2% expected, -1.1% prior
April 15 - Wednesday
CPI, March (8:30): 0.2% expected, 0.4% prior
Core CPI (8:30): 0.1% expected, 0.2% prior
New York PMI, April (8:30): -35.0 expected, -38.2 prior
Capacity Utilization, March (9:15): 69.7% expected, 70.9% prior
Industrial Production, March (9:15): -0.9% expected, -1.4% prior
Crude oil inventories (10:30): +1.6M prior
Fed Beige Book (2:00)
April 16 - Thursday
Housing starts, March (8:30): 550K expected, 583K prior
Building permits, March (8:30): 550K expected, 547K prior
Initial jobless claims (8:30): 658K expected, 654K prior
Philly Fed, April (10:00): -32.0 expected, -35.0 prior
April 17 - Friday
Michigan Preliminary sentiment, April (9:55): 58.5 expected, 57.3 prior
- 复 TUESDAY
家园 THE PLAYS: Upside: Looking for some runs ahead of earnings.
Play Date: 04/13/2009
AXE (Anixter International--$35.24; +1.41; optionable): Wholesale electronics, telecom wire, cable, fasteners, parts
http://biz.yahoo.com/p/a/axe.html
After Hours: $35.24
EARNINGS: 04/28/2009
STATUS: Cup w/handle. Strong volume Monday as AXE just cracked the breakout from its 2.5 month base. Nice higher low at the bottom of the base, holding the initial consolidation level in December as AXE came off the low. Excellent action and looking to pick up AXE as it hacks its way higher. Plenty of room to run up to the 200 day SMA (42.69) ahead of its earnings.
Volume: 944.631K Avg Volume: 590.776K
BUY POINT: $35.42 Volume=600K Target=$42.22 Stop=$32.94
POSITION: AXE HG - Aug. $35c (56 delta, 77 OI) &/or Stock
http://www.investmenthouse.com/cd/axe.html
Play Date: 04/13/2009
DO (Diamond Offshore--$70.75; -0.64; optionable): Offshore drilling
http://biz.yahoo.com/p/d/do.html
After Hours: $70.69
EARNINGS: 04/23/2009
STATUS: Reverse head and shoulders. After a 4 month trading range DO has made a higher low at the midpoint of the range, holding near the 50 day SMA (63.55) on the low as it forms a 4 week accumulation pattern. A higher low after 4 to 5 cycles in a rolling range tells you to watch for a breakout; the range cannot last forever and the higher low tells you buyers were stepping in at a higher price, indicating more buyers are moving in. Bumping the neckline and we are watching for a break higher on some stronger trade (volume has been quite weak) to step in. DO can move on low volume so it just has to show some better trade as it makes the break higher. Plenty of room to run up to the 200 day SMA at 83.77.
Volume: 2.247M Avg Volume: 3.581M
BUY POINT: $71.62 Volume=4.5M Target=$82.94 Stop=$68.48
POSITION: DO FN - June $70c (52 delta) &/or Stock
http://www.investmenthouse.com/ci/do.html
Play Date: 04/13/2009
LRCX (Lam Research--$25.30; -0.26; optionable): Chip equipment
http://biz.yahoo.com/p/l/lrcx.html
After Hours: $25.09
EARNINGS: Late April (last announced 01/28/2009)
STATUS: Ascending triangle. LRCX broke out from a 4 month trading range mid-March, and in consolidating that move has formed the current 4 week triangle, making higher lows below a peak in the 26 range. Indeed the 200 day SMA (25.78) is just below that level and has blocked LRCX the past two sessions as it bumped that level on the highs. Showing a doji on volume and looks ready to make the break. Nice clean shot at 30 on a break higher and looking for that move ahead of its late April earnings announcement.
Volume: 4M Avg Volume: 3.678M
BUY POINT: $26.08 Volume=5M Target=$29.95 Stop=$24.25
POSITION: LMQ FE - June $25c (54 delta) &/or Stock
http://www.investmenthouse.com/cd/lrcx.html
Play Date: 04/13/2009
STLD (Steel Dynamics--$11.25; +0.56; optionable): Steel and iron
http://biz.yahoo.com/p/s/stld.html
After Hours: $10.23
EARNINGS: 04/22/2009
STATUS: Cup w/handle. STLD shows down after hours but it was a late trade and there is no news that we can find. It gave a good move on the session, clearing the early April peak (10.78) on rising trade. Like the positioning as there is plenty of room to run to the upside toward resistance at 14. If it is down in the morning we will watch to see where it holds (the 90 day SMA is at 10.25) and when it starts to bounce move in. Looking for a trade into earnings with the idea to move in, ride it upside, then sell it before the results.
Volume: 7.705M Avg Volume: 8.408M
BUY POINT: $11.39 Volume=9.5M Target=$13.94 Stop=$10.44
POSITION: RQL HB - Aug. $10c (70 delta) &/or Stock
http://www.investmenthouse.com/ci/stld.html
Continuing plays ready to move:
Play Date: 04/10/2009
CHK (Chesapeake Energy--$20.74; +0.04; optionable): Natural gas exploration, production
http://biz.yahoo.com/p/c/chk.html
After Hours: $20.80
EARNINGS: 02/17/2009
STATUS: Trading range breakout. Holding steady Monday, at least on the close. CHK reached down and tested the 10 day EMA on the low and rebounded. Good shakeout. It is holding over the resistance it broke Thursday, and now CHK is ready to make the next run higher. To recap: CHK bounced up and down in its 4 month trading range from 14 to 20 and then gapped out of the pattern Thursday. This move is a bit different from the prior up and down cycles in the trading range: on the last dip off the high it held midrange at the 50 day EMA (17.55) and rebounded immediately to the top of the range, tested, and broke higher. It could still fall back in but after this many cycles (4) the range tends to break down and with the market breaking higher it is logical for CHK to break higher as well. Thus looking to move in this week. It could test back to 20 first and if it does we will pick it up off that test. If not we can pick up positions from a continued move higher.
Volume: 13.799M Avg Volume: 17.249M
BUY POINT: $21.11 Volume=22M Target=$24.95 Stop=$19.63
POSITION: CHK GD - July $20c (62 delta) &/or Stock
http://www.investmenthouse.com/ci/chk.html