Morning Update 6/29/2012

The stock market indices had a very difficult, ugly opening, and a sharp down session until the last hour to hour and a half, when they came back with a roar.The day started out with futures lower. They spiked down, bounced, formed bear wedges, and dropped even sharper to the morning lows, having dropped from 2565 to 2520, 45 points, on the Nasdaq 100 in just the first hour. The S&P 500 dropped from 1332 down to 1314 and change. Then they bounced back in the morning to test resistance. When that failed, they rolled over and made new lows for the day, forming falling wedges, which indicated it could be a start of a snapback rally. That’s exactly what we got. The NDX exploded from 2510 to 2540, and the S&P 500 went from 1313 to 1330. They closed not far off from those levels, and came way off the lows to close slightly lower on the day. Nevertheless, the technicals would mean the indicators came back sharply on the New York Stock Exchange to close positive, but it was still quite negative on Nasdaq 100.

Net of the day, the Dow was down 24.90 at 12,602.11, 150 points off its low, the S&P 500 was down 2.84 at 1329.01, 16 points off its low, and the Nasdaq 100 down 28.88 at 2536.65 to, 28 points off its low.

Advance-declines were 16 to 13 positive on New York, and 3 to 2 negative on Nasdaq. Up/down volume was slightly positive on New York, with total volume of 850 million shares. Nasdaq traded 1 2/3 billion, and had 3 to 1 negative volume over declining volume.

Stepping back and reviewing the hourly chart patterns, the indices came down sharply, and then into late afternoon were at the lows for the day at the apex of falling wedges. They snapped back in the last hour to hour and 20 minutes, and took back a big chunk of the losses to close down, but only fairly nominally so, except on Nasdaq 100.

Let’s see what this technical snapback off support means, whether it means anything or not.

Friday, June 29

Economics
8:30 am: Personal Income, consensus 0.2%, prior 0.2%
8:30 am: Personal Spending, consensus 0.0%, prior 0.3%
8:30 am: PCE Deflator M/m, consensus -0.1%, prior 0.0%
8:30 am: PCE Core M/m, consensus 0.2%, prior 0.1%
9:45 am: Chicago Purchasing Manager, consensus 53.7, prior 52.7
9:55 am: University of Michigan consumer sentiment, consensus 74.4, prior 74.1
11:00 am: Fed to purchase $4.25b-$5.25b notes in 6 to 8-year range
1:30 CNY Industrial Profits
1:30 AUD Private Sector Credit
2:30 CNY HSBC Manufacturing PMI
5:00 JPY Annualized Housing Starts
7:00 CHF KOF Swiss Leading Indicator
9:00 EUR Euro-Zone Consumer Price Index
12:30 CAD GDP

Earnings
Before:
KB Home (KBH) EPS -0.33c, revs 295M

GDP rose 1.9%, in line with expectations. Jobless claims were 386,000, slightly more than the expected 385,000. On Friday we will get personal income, Chicago PMI and consumer sentiment.

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Morning Update: 6/28/2012

The stock market indices had an up day today. They were a little choppy, but opened strongly, pulled back, and then had a very strong move, reaching 2576 on the Nasdaq 100 and 1332 on the S&P 500. They then consolidated, rolled over in the afternoon, retested the lows on the NDX, but the S&P 500 was far from the lows and twice made nominal new highs in the afternoon, while the NDX did not. That resulted in a late rollover on the pullback, but it was still a good day for the indices.Net of the day, the Dow was up 92.34 at 12,627.01, about 19 points off its high, the S&P 500 was up 11.86 at 1331.85, only 3 points off its high, and the Nasdaq 100 up 15.69 at 2565.53, 11 points off the high.

Advance-declines were nearly 4 to 1 positive on New York, and 2 1/2 to 1 positive on Nasdaq. Up/down volume was 4 to 1 positive on New York, with total volume of 662 million shares. Nasdaq traded 1.6 billion, and had a 3 1/2 to 1 positive volume ratio.

Stepping back and reviewing the hourly chart patterns, the indices gapped up, they pulled back, held support, and exploded on the Nasdaq 100 early on to the session high, but the S&P 500 didn’t listen and kept going, making two nominal new highs during the day without confirmation from the NDX.

Today the highs were right up near the declining moving averages on the hourly charts, and so far that remains resistance.

 

Thursday, June 28

Economics
8:30 am: GDP Q/q, 1Q revised, consensus 1.9%, prior 1.9%
8:30 am: Personal Consumption, 1Q revised, consensus 2.7%, prior 2.7%
8:30 am: GDP Price Index, 1Q revised, consensus 1.7%, prior 1.7%
8:30 am: Core PCE Q/Q, 1Q revised, consensus 2.1%, prior 2.1%
8:30 am: Initial Jobless Claims, consensus 385k, prior 387k
8:30 am: Continuing Claims, prior 3.299m
9:45 am: Bloomberg Consumer Comfort, prior -37.9
11:00 am: Kansas City Fed Manufacturing Activity, consensus 4, prior 9
11:00 am: Fed to sell $8-8.75b notes in 2 to 3-year range
1:00 pm: Treasury to sell $29b in 7-year notes
1:00 AUD HIA New Home Sales
1:00 NZD NBNZ Activity Outlook and Business Confidence
1:30 EUR German June Unemployment Data
7:55 EUR German Unemployment Change
8:30 GBP Gross Domestic Product
8:30 GBP Current Account
8:30 GBP Total Business
9:00 EUR Euro-Zone Consumer Confidence
22:45 GBBP GfK Consumer Confidence
23:30 JPY Jobless Rate
23:30 JPY Household Spending
23:30 JPY National Consumer Price Index
23:30 JPY Industrial Production
9:00 Italy to sell bonds

Earnings
Before:
Family Dollar  (FDO) EPS $1.07, revs 2.37B
Shaw Comms (SJR) EPS 44c, revs 1.30B
After:
Accenture (ACN) EPS 9c, revs 7.16B
Nike (NKE) EPS 1.37c, revs 6.51B
Research in Motion (RIMM) EPS -0.7c, revs 3.04B

 

Morning Update: 6/27/2012

The stock market indices had a positive session, although they started out with a gap up, ran up to resistance, came down hard, and held support. They then rallied in a 5-wave advance into key overhead resistance at the 2555-6 area on the Nasdaq 100, and the 1322-24 zone on the S&P 500. They tried to get through three times in the afternoon, but couldn’t do so, rolled over in the last 10 minutes, and backed off the gains for the day. Still, they ended positive on the session. Net on the day, the Dow was up 32.01 at 12,534.67, the S&P 500 up 6.28 at 1320 even, and the Nasdaq 100 up 16.30 at 2549.84.Advance-declines were a little less than 2 to 1 positive on New York, and Nasdaq had about 1375 up and 1084 down, with a plurality of about 290 issues. Up/down volume was almost 2 to 1 positive on New York, total volume 678 million. Nasdaq traded 1.55 billion, and had a 3 to 2 positive volume ratio.

Stepping back and reviewing the hourly chart patterns, the indices were up early to resistance, rolled over to test support, and then moved in a 5-wave advance from late morning to late afternoon before backing off to key resistance late in the day.

Nevertheless, there were gains on the day, and after yesterday’s late hard hit, we’ll take it. However, I will say, the down trend has now had 4 waves off the top, and we may very well see one more before they end this.

Let’s see how it goes tomorrow.

 

Wednesday, June 27

Economics
7:00 am: MBA Mortgage Applications, prior -0.8%
8:30 am: Durable Goods Orders, consensus 0.5%, prior 0.0%
8:30 am: Durables Ex-Transportation, consensus 0.7%, prior -0.9%
8:30 am: Cap Goods Orders Nondef Ex Air, consensus 0.6%, prior -1.9%
10:00 am: Pending Home Sales M/m, consensus 1.3%, prior -5.5%
11:00 am: Fed to purchase $1.5b-2.2b notes in 25 to 30-year range
1:00 pm: U.S. to sell 5-year notes
8:30 GBP BBA Loans for House Purchase
12:00 EUR German Consumer Price Index
23:15 JPY Nomura Manufacturing Purchasing Manager
23:30 JPY Retail Trade
23:50 JPY Large Retailers’ Sales

Earnings
Before:
Commercial Metals (CMC) EPS 37c, revs 2.15
General Mills (GIS) EPS 59c, revs 4.11B
Lennar (LEN) EPS 17c, revs 906M
McCormick (MKC) EPS EPS 61c, revs 968M
Monsanto (MON) EPS $1.60, revs 4.01B
After:
No major earnings reports

Consumer confidence came in at 62.0. Last month it was 64.9. The Case Shiller home price index dropped 1.91% year over year. The consensus was for a drop of 2.3%. On Wednesday we will get durable goods, pending home sales and oil inventories.

Morning Update: 6/26/2012

The stock market indices started off on a very bad note for the week with a big gap down due to the overseas news from Europe and elsewhere. But more importantly, the indices kept falling, and falling hard, until late morning when they finally found some stability. At that point, the Nasdaq 100 had dropped dramatically from an opening of 2563 down to the 2527-2528 area. The S&P 500 dropped from 1329 down to 1309. They did manage to bounce midday, backed off midafternoon to test, and then bounced to higher highs in the afternoon, but rolled over in the last 10 minutes to end up sharply lower.It was the worst day on Wall Street in 2012 on Thursday in terms of the losses, and it was a steady down move all day….   Net of the day, the Dow was down 138.12 at 12,502.66, about 45 points off its low, the S&P 500 was down 21.30 at 1313.71, about 4 points off its low, and the Nasdaq 100 down 51.99 at 2533.54, only 6 points off it.

Stepping back and reviewing the hourly chart patterns, the indices were down sharply in the morning in a 5-wave decline, rallied in a 3-wave corrective move, and then backed off to retest the lows. When that was successful, they tried a late rally, which failed and rolled over into the close.

 

 

Tuesday, June 26
Economics
9:00 am: S&P/CS 20 City M/m, April, est. 0.2%, prior 0.1%
9:00 am: S&P/Case-Shiller Home Price Index, prior 134.1
10:00 am: Consumer Confidence, June, consensus, 63.5 prior 64.9
10:00 am: Richmond Fed Manufacturing Index, consensus 5, prior 4
11:00 Fed to purchase $4.5b-5.5b in 8 to 10-year range
11:30 Treasury selling $25b 1-year bills, 4 weeks bills
1:00 Treasury selling $35b 2-year notes
6:00 CHF UBS Consumption Indicator
8:30 GBP Public Finances
8:30 GBP PSNB ex Inventions
8:30 GBP Public Sector Net Borrowing
22:45 NZD Trade Balance
10:30 Spain to sell 3-month, 6-month bills

Earnings
Before:
Robbins & Myers (RBN) EPS 89c, revs 268M
After:
H & R Block HRB) EPS $2.02, revs 2.01B

New home sales were 369,000, more than the expected 350,000. The Dallas Fed survey came in at 5.8. better than the expected reading of zero. On Tuesday we will get the Case Shiller home price index and consumer confidence.

 

 

Morning Update: 6/22/2012

The stock market indices did not fare well today. It was a very bad day on Wall Street as the markets were pounded with economic news, both domestic and abroad, as well as bank downgrades. The day started out poorly. The indices opened lower, and then moved down to support a bounce from bear flags.  We came down and broke three layers of support, and closed at the lows for the day going away.

Net of the day, the Dow was down 250.82 at 12,573.57, about 8 points off its low, the S&P 500 was down 30.18 at 1325.51, and the Nasdaq 100 down 66.37 at 2556.96.

It was a very, very negative day on Wall Street.

Advance-declines were nearly 5 to 1 negative on New York, and 4 to 1 negative on Nasdaq. Up/down volume was about 7 to 1 negative on New York, total volume about 860 million shares. Nasdaq traded 1.75 billion, and had a 7 to 1 negative volume ratio.

Stepping back and reviewing the hourly chart patterns, the indices came down in the morning, then basically stair-stepped their way lower in distinct falling channels and wedges all day, each rally failing at resistance. Not one time did we get 15 minutes of rallying during the session, other than the quick one in the morning. It was a very bad day, but what is distressing about today is that the necklines on the recent head-and-shoulder patterns that were broken to the upside, rolled over hard through those necklines, and closed right near key secondary support. So the bulls better step in tomorrow, or this market will get hammered lower.

We’ll see what happens tomorrow.

Instrument Strategy Market pos. Quantity Entry price Exit price Profit
6E 09-12 Long 2 1.2577 1.256 -434
NG 07-12 Short 1 2.609 2.623 -144.5
FDAX 09-12 Initiative Trade Balance Extreme Short 2 6406 6411 -259
TF 09-12 Initiative Trade Balance Extreme Short 1 775.9 776.7 -84.5
TF 09-12 Initiative Trade Balance Extreme Short 1 775.9 776.7 -84.5
FDAX 09-12 Initiative Trade Balance Extreme Short 1 6403 6407.5 -117
FDAX 09-12 Initiative Trade Balance Extreme Short 1 6403 6407.5 -117

Friday, June 22

Economics
No major U.S. economic reports
11:00 Fed to purchase $1.5b-$2.25b notes in 25 to 30-year range
01:00 NZD NBNZ Business Confidence
08:00 EUR German IFO Business Climate
12:30 CAD CPI
11:10 UK to sell bills

Earnings
Before:
Darden Restaurants (DRI) EPS $1.16, revs $2.11B

Initial claims were 387,000, more than the consensus 383,000. Existing home sales were 455,000, less than the expected 457,000. The Philly Fed Index was – 11.6, much less than the anticipated 0.5. There is nothing of significance scheduled for Friday.

Morning Update: 6/21/2012

The stock market had a spectacularly volatile day, with the indices all over the place. In the morning, they backed and filled before the FOMC statement that caused the market to dip sharply, but it held support, and they rallied back very sharply when the news was interpreted as positive. They went to nominal new highs on the Nasdaq 100, but did not confirm on the S&P 500. Then they rolled over in a mini, 7-wave decline that nearly tested the lows, but late in the day, they snapped back sharply to put the NDX back in the plus column. The S&P 500 and Dow blue chips remain with minor losses today. Net of the day, the Dow was down 12.94 at 12,824.39, about 80 points off its low and about 50 points off its high, so you can see the big swing today. The S&P 500 was down 2.29 at 1355.39, only 6 points off its high, but 9 points off the low. The Nasdaq 100, however, was up 2.50 at 2623.33, 10 points off the high and 20 points off the low.

Stepping back and reviewing the hourly chart patterns, the indices were mixed in the morning, plunged midday, snapped back with abandoned to new session highs, and then rolled over to retest the lows before bouncing late in the session.

It was a very volatile day, and net-net it was a mixed session.

Instrument Strategy Market pos. Quantity Entry price Exit price Profit
ES 09-12 Responsive Trade Balance Extreme Short 1 1346.25 1344.75 70.5
GC 08-12 Long 2 1602.9 1603.6 131
CL 07-12 Long 1 81.63 81.64 5.5
6A 09-12 Initiative Trade Balance Extreme Long 1 1.0065 1.0127 615.5
6A 09-12 Initiative Trade Balance Extreme Long 2 1.0065 1.0113 951
ES 09-12 Responsive Trade Balance Extreme Long 1 1349.25 1348.5 -42
ES 09-12 Long 2 1350 1348.5 -159
FDAX 09-12 Responsive Trade Balance Extreme Short 2 6379.5 6387 -384
FDAX 09-12 Responsive Trade Balance Extreme Short 1 6379.5 6387 -192

Thursday, June 21

Economics
08:30 Initial Jobless Claims – consensus 380K, prior 386K
08:30 Continuing Claims – consensus 3275K, prior 3278K
08:58 Markit Preliminary US PMI – consensus 53.0, prior 53.9
10:00 Philadelphia Fed – consensus 0.0, prior -5.8
10:00 Existing Home Sales – consensus 4.57M, prior 4.62M
10:00 House Price Index – consensus 0.4%, prior 1.8%
10:00 Leading Indicators – consensus 0.1%, prior -0.1%
11:00 Fed to purchase $4.25b-5.25b in 6 to 8-year bonds
11:30 U.S. to sell $7b in 30-yr TIPS
06:00 CHF Trade Balance
07:15 CHF Industrial Production
07:30 EUR German PMI
08:00 EUR Eurozone PMI
08:30 GBP Retail Sales
12:30 CAD Leading Indicators
14:00 EUR Consumer Confidence
9:30 Spain to sell bonds
10:00 France to sell bonds/notes
10:30 U.K. to sell bonds

Earnings
Before:
CarMax (KMX) EPS 54c, revs $2.85B
ConAgra (CAG) EPS 50c, revs $3.40B
Rite Aid (RAD) EPS -5c, revs $6.47B
After: 
Oracle (ORCL) EPS 78c, revs $10.88B

Oil inventories rose 2.9 million barrels, compared to last week’s drop of 200,000. On Thursday we will get initial claims, existing home sales and The Philadelphia Fed Survey.

Morning Update: 6/20/2012

 

 

The stock market indices had a very strong morning with breakaway gaps on strong run-ups until late morning when they backed off. But they came on again strongly into the early afternoon, and reached their session highs in overbought territory close to key resistance on the S&P 500, near 1355 and on the Nasdaq 100 near 2630. At that point, we warned our subscribers that they should see an afternoon sell-off, and we did get that. The NDX went from 2631 to 2618, and the S&P 500 dropped 1363 1/2 to 1357. They bounced, and backed off to retest the afternoon lows there.  Net of the day, the Dow was up 95.51 at 12,837.33, about 60 points off its high, the S&P 500 was up 13.20 at 1357.97, only 6 points off its high, and the Nasdaq 100 up 28.31 at 2620.83, 10 points off the high.  Stepping back and reviewing the hourly chart patterns, the indices were up sharply in the morning, extended to early afternoon, and backed off in the afternoon to back and fill, but held support, and closed with solid gains with good technical s on the day.

Let’s see what happens tomorrow.

 

Instrument Strategy Market pos. Quantity Entry price Exit price Profit
6C 09-12 Initiative Trade Balance Extreme Short 3 0.9805 0.9806 -43.5
ES 09-12 Initiative Trade Balance Extreme Long 1 1350.5 1350.75 8
ES 09-12 Initiative Trade Balance Extreme Long 1 1339.75 1350.75 545.5
ES 09-12 Initiative Trade Balance Extreme Long 1 1339.75 1350.75 545.5
ES 09-12 Initiative Trade Balance Extreme Long 1 1339.75 1350.75 545.5
6C 09-12 Initiative Trade Balance Extreme Short 1 0.981 0.981 -4.5
6C 09-12 Initiative Trade Balance Extreme Short 3 0.981 0.981 -13.5
GC 08-12 Short 1 1623.7 1624.4 -74.5
GC 08-12 Short 2 1623.7 1624.4 -149
GC 08-12 Short 1 1623.7 1624.4 -74.5
GC 08-12 Short 1 1623.5 1623.5 -4.5
GC 08-12 Short 1 1623.5 1623.4 5.5

 

Wednesday, June 20

Economics
07:00 MBA Mortgage Purchase Index
12:30 FOMC Rate Decision
2:00 FOMC Bernanke Press Conference
01:30 AUD Dwelling Starts
04:30 JPY All Industry Activity Index
06:00 EUR German Producer Prices
08:30 GBP BoE Minutes
08:30 GBP Jobless Claims Change
09:00 CHF ZEW Economic Survey Expectations
22:45 NZD GDP
11:30 Germany to sell 2-yr notes

Earnings
Before:
No major reports
After:
Bed Bath & Beyond (BBBY) EPS 84c, revs $2.24B
Micron (MU) EPS -19c, revs $2.02B

Housing starts were 708,000, lower than the expected 720,000. On Wednesday we will get oil inventories and the FOMC announcement.