Good morning.
Nice rally to say the least. To show you how strong and participatory the rally was check out the 40 DPI charts. They jumped big time on all three indexes. The number of declining shares in the S&P500 never went above 13 and reached a minimum of 1 so at some point on Wednesday there was just 1 symbol trading down on the S&P 500. Shorts had nowhere to hide yesterday.
But it is always about today and we are here to judge the follow through. With such a huge move we worry about being in overbought.
News at 8:30 will help determine the momentum continuation for the day. Bad numbers and we could give it all back.. well, I don’t think so but really bad numbers maybe.
8:30am is initial jobless claims. It would be nice to continue our downward trend that started last week from a high of 500K two weeks ago. We need to stay below 500K today to keep happy and any reading below 473K would really turn the markets on.
10am Pending home sales. Anything with the word house in it scares me. The experts are looking for a flat number here (0) after a –2.6% posted last month. Anything near zero should be ok. Anything positive will be positive.
10:30 Nat Gas. We might get a rally here if we see some drawdown. Nat Gas is in search of GDP growth as it is the fuel of the economy.
Quote of the day:
It matters not whether you win or lose; what matters is whether I win or lose. – Darrin Weinberg
|
Chart |
Score |
Day-1 |
Change |
|
40 DPI |
+6 |
-2 |
+8 |
|
52 WNH |
+6 |
+2 |
+4 |
|
10 DHL |
+6 |
0 |
+6 |
|
Total |
+18 |
0 |
+18 |
What can you say about those charts. They moved with the day in a huge upside breakout fueled by higher than expected China PMI numbers and signs of growth in Europe. It will be about follow through today.
$SPX chart:
I guess that I will have to give the game to the bulls yesterday. They rallied and held. Currently it looks like a gapless open but 8:30 am news is pending and Euro interest rates are announcing too at 7:45am EST.
The bulls closed pinned up next tor our 1081.33 key resistance line we had in there from yesterday. I would think we might battle before heading up and over. Above 1081 we have 1086/87 and then a ride up to 1094. If we are in a new bull run we could/should be skipping through these levels pretty quickly.
Downside. The bulls need to break 1063 to garner any points and respect. That would put the ball back into the low end trading range. Below 1063 are the usual support and resistance levels. There is decent support at 1070/71 and 1075/76
Watch for follow through. 1% or more gain the and the bull lives. Retracement to below 1063 the buyers just aren’t going to sustain a rally yet and a consolidation day, the market is ok and waiting for the Jobs number.
We have a 67% chance of being up 1% or greater sometime today.
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