A Mild Relief Rally
by Jerome "Mel" Hickerson
We didn't have any economic data to review before the open but today we received the Fed's latest announcement at the end of their two-day meeting. Before the open the news was that Greece had banned short-selling on their stock market and the expectation was to see a resolution of the bailout package announced. With the exception of London the major overseas markets were lower across the board. Futures pointed to a stronger open.
The FED day session opened with the expected gap upward but retreated half way by 10am. The next hour traded in a tight range but was moving upward nicely at 11:25 when news hit that S&P had downgraded the bond rating on yet another European country. The SPX promptly plunged 10 points within minutes setting the low of the day at 11:38. The index then patiently rallied 10 points into the FED announcement; tacked on three more points after the announcement before chopping turbulently into the close. The final 10 minutes of the day saw a three point bounce as all the major indices closed in positive territory.
There are many ways to look at today's action. The bounce today seemed weaker than it should have been but the news during the session was negative yet the indices closed green, stopping the slide from yesterday. The Russell is above its 20 DMA, the DOW and NASDAQ are sitting right on their 20 DMA and the SPX closed below. So Thursday and Friday seem to be important to watch to see if support holds or whether it is violated.
Inside the numbers, the new highs dropped to a two month low while the three day sum of new lows increased to an 11 week high. Breadth today did not really broadly support the bounce. For the first time in a long while we are beginning to see some of the moving averages turn downward. The indices are weakened here but whether a true trend change is occurring remains yet to be seen; I think it'll be clear by Friday's close.
Very short term: My bias for tomorrow and Friday is somewhat bullish.
Day Trade Systems Update: (Signals today)
* UYM at: 11:57
SPX Summary for Wednesday, April 28, 2010
341 Advancers/150 Decliners
Today's SPX component winners and losers:
• Largest one day loser is RHI with -10.18%
• Largest three day loser is ODP with -18.65%
• Largest five day loser is NYT with -19.87%
• Largest ten day loser is AKS with -23.31%
• Largest one day winner is AIG with 5.80%
• Largest three day winner is WHR with 8.28%
• Largest five day winner is WHR with 12.06%
• Largest ten day winner is WHR with 19.15%
*** SPX Technical Summary ***
The lowest 14 day RSI component is AKS; the highest 14 day RSI component is BDK. The average 14 day RSI of all 500 components is 54.
The greatest positive five day momentum component is WHR; the greatest negative five day momentum component is NYT. The average five day momentum of all 500 components is -0.87.
53.00% of the SPX components are giving a crossover Buy signal; 20.20% of the SPX components are giving a Sell signal. This is a 2.6 to 1 ratio of Buy signals over Sell signals.
SPX component signal changes today (evidence of trend):
• From Sell to Neutral: 5 components.
• From Buy to Neutral: 34 components.
• From Neutral to Sell: 19 components.
• From Neutral to Buy: 9 components.
The moving averages:
Close 1191.36
9 EMA 1180.92 Falling
5 DMA 1202.61 Falling
10 DMA 1202.75 Falling
20 DMA 1195.98 Rising
50 DMA 1161.56 Rising
100 DMA 1135.00 Rising
200 DMA 1087.75 Rising
10 Wk MA 1169.16 Rising
NYSE Summary
On the NYSE 3209 issues were traded with 1849 advancing issues and 1242 retreating issues, a ratio of 1.49 to 1 advancing. There were 92 new highs and 14 new lows.
Advancing volume was higher at a ratio of 2.56 to 1. The closing TRIN was 0.58 and the final tick was -136.
Evidence of trend:
Relative to the previous 30 session average, volume was 25.22% above the average. Of the last 15 sessions 12 sessions ended with volume greater than the previous rolling 30 day average volume. Of the last 30 sessions, 22 sessions ended on a positive tick, 6 of last 10.
The 5 day moving average of New Highs is 347 while the 5 day moving average of new lows is 12 and the 10 day moving average of Net Advancing is 55.
Remember: Breadth leads, indices follow. Today, the NYSE Advance/Decline line increased from 209875 to 210482. This 0.29% increase came while the SPX was gaining 0.64%. The 10 day moving ratio of positive volume is 0.8 and the 10 day moving Advance/Decline ratio is 1.04. The 10 day moving ratio of positive volume has trended -0.19 over the last three days and the 10 day moving Advance/Decline ratio has trended -0.25 over the last three days.
The NYSE Composite Index gained 0.49% today.
NYSE Statistics:
Absolute Breadth Index: 33.04 up from previous day of 32.26
Cumulative Volume Index: 77,675.85 up from previous day of 74,220.87
High Low Logic Index: 0.66 down from previous day of 0.73
McClellan Oscillator: (78.48) up from previous day of (106.28)
McClellan 10 DMA: (17.64) down from previous day of (0.14)
McClellan Summation Index: 3,459.33 down from previous day of 3,537.81
% Stocks Above 200 DMA: 84.19 up from previous day of 83.99
% Stocks Above 40 DMA: 66.81 up from previous day of 66.39
New High / New Low Ratio: 87.76 down from previous day of 93.12
26wk New High/Low Ratio: 73.32 down from previous day of 86.28
13wk New High/Low Ratio: 67.85 down from previous day of 79.59
4wk New High/Low Ratio: 32.43 down from previous day of 46.61
Cumulative 4-Week New Hi-Low: 445,670 down from previous day of 445,899
Nasdaq Adv/Decline: 1,775 up from previous day of 1,771
Russell 1000 Advance/ Decline Line: 2,745 up from previous day of 2,712
Russell 2000 Advance/ Decline Line: (1,538) up from previous day of (1,553)
Notes:
Absolute Breadth Index: Low numbers suggest a topping process and high numbers suggest a bottoming process.
Cumulative Volume Index: If this begins to trend down while the averages are trending up, it is a bearish sign. If this begins to trend up while the averages are trending down, it is a bullish sign.
High Low Logic Index: High readings are bearish; low readings are bullish.
McClellan Oscillator: -100 is oversold and +100 is overbought. Also watch for crosses above and below zero.
McClellan Summation Index: Interpreted as bullish or bearish when it crosses over the zero line.
Cumulative 4-Week New Hi-Low: The difference between the number of issues reaching new highs (during a 4-week period) and the number of issues reaching new lows (during the same 4-week period).
Thursday, April 29
Economics
08:30 Initial Claims
08:30 Continuing Claims
03:50 Germany Unemployment Rate
05:00 European Union Economic Sentiment
07:30 Japan CPI
07:30 Japan Unemployment Rate
07:50 Japan Industrial Production
Earnings
Before: ACIW, AET, AKNS, ARE, AEP, APA, MT, BDK, BDC, BJS, BWA, BCO, BC, BBW, BG, BKC, CAM, CRR, CELB, CME, CL, COP, CNX, D, DPZ, EK, EVVV, XOM, FCN, HSC, HERO, IMAX, IP, ITG, KBR, K, LZ, MOT, MYL, MOT, BABY, ZEUS, POT, PG, ROC, SWY, SII, HOT, STFC, TDY, TWC, UTHR, WM, WY, WRLD
After: AEM, AMX, ATHN, BYI, BGFV, ELY, CALB, CEC, CYN, CTV, CYBS, DRIV, BOOM, EXPE, FNW, GFIG, HIG, MFE, WFR, MET, MCRS, MPWR, MWW, OTEX, SPWRA, STMP, TSO, TRMB, VCLK, VSEA, VPRT, VLCM
Auction
1:00 7-yr Note Auction
Weekly and continuing jobless claims are due in the early morning from the Department of Labor.
Mel’s Missives from the Matrix:
• Total tick for the day was 67,000 and the average tick for the day was 44. There were 59 ticks greater than 600 and 54 ticks more extreme than -600. There were no ticks greater than 1000 and 1 ticks more extreme than -1000.
• The day's range was 13.24 points. The 5 DMA of daily range is 15.98.
• Evidence of the intraday trend: At 10am volume was 104.3% of the 10 day average. By noon the volume was 108.33% of the 10 day average, and by 2pm volume was 100.51% of the 10 day average.
• The day's volume was 126.5% of the average daily volume for the last year. Volume was 102.6% of the last 10 day average and 89.2% of the previous day’s volume.
• Evidence of the intraday trend: The largest increase in relative volume came between 2:15 and 2:30 when relative volume increased 68.7% while the SPX was rising 0.12%. The largest drop in relative volume came between 11:45 and 12:00 when relative volume dropped -87.1% while the SPX was rising 0.11%.
• 2% of the SPX stocks closed with two day RSI above 90. 5% closed with RSI above 80. 30% closed with RSI below 20 and 14% closed with RSI below 10.
• 15.2% of the SPX are above their five day moving average, 33% are above their 10 day average, 51.2% are above their 20 day moving average, 76.4% are above their 50 day moving average, and 80.8% are above their 100 day moving average.
• 6% of the SPX closed above their most recent previous high.
• 25% of the SPX stocks closed below their most recent previous lows.
• 341 SPX issues advanced and 150 issues declined, a net SPX advance/decline of 191.
• Evidence of the intraday trend: At 10am, 33.8% of the SPX components were in the top half of the range. By noon, 32.6% were in the top half of the range, and by 2pm, 51.4% were in the top half of the range.
• 57.4% of stocks closed in the top half of the day's range. (42.4% closed in bottom half.)
• 7.6% of stocks closed in the top 10% of the day's range. 17.8% of stocks closed in the top 20% of the day's range.
• 3.6% of stocks closed in the bottom 10% of the day's range. 8.8% of stocks closed in the bottom 20% of the day's range.
• 7.8% of stocks closed within 2% of their 52 week high. 43.6% of stocks closed within 5% of their 52 week high.
• 42.4% of stocks closed within 50% of their 52 week low. 11.4% of stocks closed within 25% of their 52 week low.
• 10.2% of stocks closed within ¼% of their high for the day.
• 2.6% of stocks closed within ¼% of their low for the day.
• Evidence of the intraday trend: At 10am, 68.6% of the SPX components were up since the open. By noon, 57.2% were up since the open, and by 2pm, 67.2% were up since the open.
• 70.2% of the SPX closed up from the previous close; 49.6% closed higher than the open.
• Sectors stronger than the SPX for Wednesday:
- Basic Materials -- Outperformed the SPX by +53%.
- Energy -- Outperformed the SPX by +34%.
- Financials -- Outperformed the SPX by +82%.
- Industrials -- Outperformed the SPX by +7%.
- Consumer Staples -- Outperformed the SPX by +13%.
- Utilities -- Outperformed the SPX by +36%.
• Sectors weaker than the SPX for Wednesday:
- Technology -- Underperformed the SPX by -38%.
- Health Care -- Underperformed the SPX by -2%.
- Consumer Discretionary -- Underperformed the SPX by -101%.
• The $SOX index strength was weaker relative to the SPX Wednesday by -0.18%.
• The XLF outperformed the SPX by 0.82% Wednesday.
• The 2 Day RSI of the SPX is 35. The Dow RSI is 35, the NASDAQ is 8 and the Russell is 21.
• Over the last four sessions, the average session closed 47.59% of the range above the low. Wednesday closed at 74.4% of the daily range.
• Upside momentum increased Wednesday, from Tuesday’s -1.26 to today’s -0.87. The ratio of SPX components giving a crossover buy signal compared to sell signals decreased to B 2.62 to 1.
• The ISEE Equity 10 day moving average Wednesday was 225.2. The lowest 10 day average in the last 52 weeks was 141.5 on 06/29/09 and the highest 10 day average in the last 52 weeks was 249.3 on 04/15/10.
• 147 SPX components moved upward and 256 components downward during the after hours with 150 million shares traded.
Trade 'em well on Thursday everyone!
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"Mel"
