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yahoo stock, us stock market
Begin Part 2 of 2
THE MARKET
Overall market stats:
VIX: 27.34; +0.17. A range of over 2.50 points on an up and down session, but when all was over the indicator was flat just as the markets were.
VXN: 63.68; -2.44. Dropped on the slightest of gains, though the index was up 44 points on its high. Something to keep an eye on, but it is still a secondary indicator.
Put/Call ratio (CBOE): 0.86; +0.23. A major spike in put activity today as market shorters loaded up on puts. Index puts saw the biggest gain; that ratio was 1.62. That is 8 puts for every call. Lots of people betting on the market falling here. It did give a good downside play late, but will it give more with so many betting on it? Total option activity jumped to 1.22 million (824,881 Monday), but that was not great number (1.8 million and more on heavier days on the CBOE). Lots of pessimists out there.
NASDAQ: Tried to rally but gave it back. Had to rally in the last few minutes to close slightly positive. Still hanging on, moving laterally.
Stats: Up 3.66 points (+0.2%) to close at 2085.58.
Volume: 1.711 billion shares (+32%). Volume raced higher in the afternoon as down volume made a run on up volume. Up volume won the day 899 million to 783 million, but it lost a chunk of its lead. Looks like short selling to us given the put/call ratio. Short sellers were trying to push the market lower when they saw some weakness. It was not a powerful attempt to sell the market.
A/D and Hi/Lo: Advancing issues moved into the lead and hung on to close ahead 1.19 to 1 (decliners led 1.38 to 1 Monday). New highs rose again to 148 (+17) as new lows rose to 49 (+8).
The Chart: http://www.investmenthouse.com/cd/$compq.html
It was not a show of strength, though the index did rally 44 points in the hour following the rate cut announcement. Then it tanked and managed to close just off of its lows for the session. Failed intraday rallies are bearish, not bullish, signs. Still, given the session, we don't know how much we will put into this move. Actually we do; not a whole lot.
What we saw today was a short sellers attempt to drive the markets lower after a rally started on the indexes after the rate cut. Index put action was high and short interest was higher. The overall put/call ratio shot up. They were betting on a lower market. From the initial look of it, one might conclude they were successful. Still, we had a move higher on stronger volume; technically good, even if it was something more like churning given the small point gain on higher volume. Further, we see a lot of 'shooting star' doji's on support where stocks tried to rally, but were sold back at the close. That is a bullish pattern, and with the action on earnings after hours, we don't see investors all upset about what they are seeing. We tend to think that there is some upside pop in the market. We think we are going to see a significant upside break later this week or next week.
Dow/NYSE: The Dow was negative all session, was dragged higher by the Nasdaq move after the Fed cut, but then gave it up to close. It did rally and it almost got positive. We were not too upset with the action.
Stats: Down 4.36 points (-0.04%) to close at 10,872.97.
Volume: NYSE volume actually climbed today, rising to 1.048 billion shares (+24%). Up volume on the NYSE again edged down volume on a 'down' day, 572 million to 462 million shares. That tells us that small and mid-caps continue to perform well (we are seeing that in our plays).
A/D and Hi/Lo: Advancing issues led again on a down day, improving the lead to 1.63 to 1 (1.15 to 1 Monday). New highs rose to 160 (+23) as new lows rose to 26 (+5).
The Chart: http://www.investmenthouse.com/cd/$dja.html
The Dow hit 10,992.17 on the high, unable to take out 11,028, but it also caught support right below its 10 day MVA on its low (10,816.17; 10 day at 10,841.58). It showed another doji on the candlestick chart as its recent daily range continues to tighten. Technically a distribution day with the rising NYSE volume on the selling, but as with the Nasdaq, it looks as if we will see an upside breakout later this week or next week. We have been looking for a sell down to the 18 day MVA (10,738.48) or the 200 day MVA at 10,625.88. We may see it test those levels in the coming days, but we don't think it will turn into major selling; instead we see it as giving it another rest and platform from which it can attack 11,028 again. Also note how the 50 day MVA (10,512.21) closing in on the 200 day MVA for a positive crossover. That would act as confirmation of this move and foretell further gains ahead. We think we might see it jump ahead of that event.
S&P 500: The big caps finished positive on higher NYSE volume, but that was not much of a victory as the gain was just over a half point. Still, it continues the index' lateral movement in a tight trading range as the A/D line continues to hold up very well. This is a nice handle on the double bottom right at key resistance at 1270. It has refused to sell down, and in fact has held well above the 18 day MVA (now at 1242.11). The 50 day MVA is below at 1230.58. Unless the character changes, we look for a good move in this index as well, though perhaps not as good as the smaller stocks move (many of which we are tracking). As with the Dow we may see it fall back to these support levels before mounting another run at 1270.
Stats: Up 3.25 points (+0.3%) to close at 1248.92.
Volume: NYSE volume was the lightest of the year at 853 million (-5.8%).
The Chart: http://www.investmenthouse.com/cd/$spx.html
TOMORROW
Again, we have a hard time finding fault with 250 basis points in cuts as some are. Face it, they will always find someone to come on the television and say whatever action was taken or not taken was a bad idea. We have to put it in our own context and our own parameters. Yes today was not a defining moment in the major indexes, and there are those who are pointing to that as the sign that the market is going nowhere. Again, we cannot tell you exactly where the market will be in 6 months, but we are seeing good stocks breakout and good patterns in former leaders trying to reassert themselves. We hear more and more positive comments from companies about the future. It is hard to fight what has been happening. There are many, many out there who are betting against the market without it showing real weakness. That is often a sign that the shorts are betting incorrectly.
We are looking down the road 3 to 4 months. We are looking at picking up great stocks as they break out of great bases. We are looking at positions on great stocks that are ready to announce splits and are in good patterns. These are the leaders now. These are the stocks that will give the biggest moves as those who doubt the market now come around to buy these stocks from us later at a much higher price. Look for quality in quality bases. We covered fishing for the right stocks in TA1 and that is what we do on the reports. Then we get the strong patterns. We don't ignore shorter term plays such as rolling or channeling plays, bounce plays off of support, stocks breaking resistance; all of these are great plays in an improving market. We also need to put money into the longer term plays, however. These are the plays that are in the good bases that can give us the big moves as the market improves. There are a wealth of plays out there.
Yes we are excited, but we are also cautious as always. Take short term gains when the play is ending (bounce plays, trading ranges), and let the big plays on big breakouts run for us. We will take breakouts and we will take the short term trades. Take what the market gives you. We are going to tell the kids and grandkids about this bull run to come.
In sum: Lots of gloom out there. Put/call ratio spikes higher. Index put/call ratio shoots up to 1.63. Short interest rising. Worries about inflation because the Fed did too much. Worry about a summer slowdown already. Counter: 250 basis points in interest rate cuts, markets hanging onto gains, good stocks breaking out, companies saying they see better times ahead. We like what we see.
Support and Resistance Levels
Nasdaq: Closed at 2085.58.
Resistance: Needs to break that 10 day MVA at 2125. Then 2250. After that we are upping resistance levels to 2500.
Support: Still not a whole lot between here and 2005 where it gapped higher. The simple 50 day MVA is at 1992.01. We hope we don't test that, and we don't think we will.
S&P 500: Closed at 1249.44.
Resistance: 1270.
Support: Continued to hold above the 18 day MVA at 1242.11. The 50 day MVA is just below that at 1230.58. If that is broken, look for 1200 where it gapped higher.
Dow: Closed at 10,872.97.
Resistance: Still fighting with 11,028.
Support: 10,700 continues to act as some support. Still above the 10 day MVA at 10,841.58. The 18 day MVA is at 10,738.48, another level near 10,700 to help as support. The 200 day MVA is rising and is now at 10,625.88. The 50 day MVA is way down at 10,512.21.
Weekly Economic Calendar (All times Eastern). The figures are the consensus expectations, not ours.
5-14-01
Business Inventories, March (8:30): -0.3% actual versus -0.2% expected and -0.4 in February.
Industrial Production, April (9:15): -0.3% actual versus -0.2% expected and +0.1% in March (revised down from + 0.4% prior.
Capacity Utilization, April (9:15): 78.5% actual versus 79.1% expected and 78.9% in March (revised down from 79.4%).
5-15-01
FOMC announcement (2:15): 50 basis point rate cut. Next meeting June 27. Greenspan speaks next on May 24.
5-16-01
CPI, April (8:30): 0.4% versus 0.1% prior.
Core CPI, April (8:30): 0.2% versus 0.2% prior.
Housing starts, April (8:30): 1.605M versus 1.613M prior.
Building Permits, April (8:30): 1.66M versus 1.615M prior.
5-17-01
Initial Claims, 5/12 (8:30): 384K versus 384K prior.
Philadelphia Fed, May (8:30): -10.0 versus -7.2 prior.
Leading Indicators, April (10:00): 0.1% versus 0.3% prior.
5-18-01
Trade Balance, March (8:30): -29.0B versus -27.0B prior.
Treasury Budget, April (14:00): $180.0B versus 159.5B prior.
SUBSCRIBER QUESTIONS
Q: I subscribe to the Daily and I am only about 3 weeks old with your service. I am trying to find a site on the internet that provides the 10 and 50 day (and shorter term also) moving averages on any particular stock. Datek allows you to choose ave's based on minutes (say 5 min ave), Etrade gives some info but cant see individual days etc. I've checked Yahoo and many others but cant seem to find this info. In the daily you mention watching where a stock is in relation to the 10 and 50 mvas, but I can't find this info anywhere.
A: Many sites show the moving averages on the chart, but my guess is that you are looking for the actual price as well, not just a line on the graph, right? There are many services that allow you to watch moving averages such as BigCharts.com or Askresearch.com. They do not show you the actual numerical value of the MVA. Investertech.com does do this, but they now charge a fee for this service to customize the moving averages as we like them (they offer the 5 day, 10 day and 20 day options on the free chart). If anyone knows of another site, please advise. We use eSignal to get the daily moving averages, but that is part of a larger use of this realtime service.
TEAM TRADES
EBAY formed a small ascending wedge in the right side of an 8-month base. The stock moved up Monday on stronger volume, so we were looking for an entry point on a continued move up in a rate cut rally.
The stock opened at 55.48 then raced up to 56.70, setting off an alarm at 9:23 CT that we had set at 56.29 (the April high and the high point in the pattern). The stock pulled back then, just what we were looking for in order to take positions. Volume was tapering off after rallying on the initial move up (and was just under 2 million; below that of the previous day's of 5.4 million; average is 5.6 million), but picked up again as the stock dipped lower to test the 55.75 level. Volume was looking good. The stock would move up and retest that level an hour later. At that point, we looked at taking positions as volume picked up again; it was now up to 3.5 million. Support looked good at 56 so we put in a limit order on the July $50 options at the ask as they were trading 11.20 by 10.80. Obviously we wanted to get in before a rally. Anyway, they had dropped down from an ask of 11.80 earlier in the morning. We then got a run up to 56.62 but volume just wasn't there and the stock drifted back down to test 55.75 again. That ended with news of the rate cut, when EBAY shot up to a new high at 57.05. That looked great, but action was pretty choppy (between 56 and 56.75) as the stock pulled back and bounced around until finally it ran back up to 57 as the Nasdaq rallied 40 points. Volume finally broke above average to 6.34 million. We put in a stop loss at 9 on the options.
By market close the stock had pulled back to 56.05 to close, the market giving back the rate cut pop. Options were back down to 11.10 by 11.70. Not a super-strong move, considering the volume, but the stock remains above support so we will see if the market can pick up and give a strong rally. Looking solid here.
Investment House subscribers are offered a special from eSignal for those interested in a realtime service. Contact:
Genevieve Tsamoudakis
Account Executive
Data Broadcasting Corporation
800-322-1617
gtsam@dbc.com
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www.esignal.com
For a review of frequently asked questions, please use the link below:
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Good Investing!
Jon Johnson and the Tech Traders Report Staff.
All of the foregoing is commentary for informational purposes only. All statements and expressions are the opinion of Online Investment Services, LP or its paid consultants and are not meant to be a solicitation or recommendation to buy, sell, or hold securities. We are not licensed or registered in the securities industry. The information presented herein and on our related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolio of Partners of Online Investment Services, LP or its paid consultants may, in some instances, include securities mentioned herein and on our web site. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors.
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yahoo stock
us stock market
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