Early Fireworks But Bears Fumble Again
by Jerome "Mel" Hickerson
Overnight news reflected that Greece was saying that they don't need aid and the IMF projected that the worlds advanced economies face "acute challenges" in tackling their public debt. The Chicago Fed reported that their National Activity Index fell to -0.64% in February and the January reading was revised downward to -0.04 from 0.02
The overseas markets were mostly lower as we moved towards our open as traders were attempting to assess what the health care bill means. Stock futures were down significantly and the week opened under selling pressure. That selling pressure lasted all of one minute as the SPX gapped down more than five points then painted the low of the day on the chart at 9:31. A sharp counter move quickly brought the indices into positive territory before 10am, where they consolidated for half an hour before ramping up again. From 11am through 1pm was sideways choppy trade, then once again the bulls ramped things upward. That quick market jolt consolidated with a downward bias for 75 minutes and then yet again the index surged upward before spending an hour consolidating downward. The final hour was a slow sideways drift with a slight downward bias. The final five and a half hours traded within a four point range. Basically, after the open it was a pretty uneventful day.
It’s almost impossible to not evaluate today as a major disappointment for the bears; the week opened exactly as the bears wished but it lasted for only a minute before the bulls regained control and began pushing back uphill. It looked way too easy for the bulls; the bears have no success pushing similarly.
I suspect we see less early fireworks Tuesday but more intraday volatility, with some pushback by the bears coming later in the week. From a chart perspective, the SPX has painted three lower highs and three lower lows; all in the most bullish fashion imaginable. Volume and breadth are lagging and we’ll continue to monitor that closely this week.
SPX Summary for Monday, March 22, 2010
371 Advancers/122 Decliners
Today's SPX component winners and losers:
• Largest one day loser is CHK with -3.97%
• Largest three day loser is COG with -9.94%
• Largest five day loser is CNX with -8.52%
• Largest ten day loser is CNX with -16.75%
• Largest one day winner is THC with 8.82%
• Largest three day winner is THC with 11.13%
• Largest five day winner is LSI with 18.78%
• Largest ten day winner is LSI with 20.07%
*** SPX Technical Summary ***
The lowest 14 day RSI component is CHK; the highest 14 day RSI component is CTAS. The average 14 day RSI of all 500 components is 67.
The average five day momentum of all 500 components is 2.17.
76.60% of the SPX components are giving a crossover Buy signal; 5.00% of the SPX components are giving a Sell signal. This is a 15.3 to 1 ratio of Buy signals over Sell signals.
SPX component signal changes today (evidence of trend):
• From Sell to Neutral: 3 components.
• From Buy to Neutral: 11 components.
• From Neutral to Sell: 5 components.
• From Neutral to Buy: 20 components.
NYSE Summary
On the NYSE 3197 issues were traded with 2024 advancing issues and 1036 retreating issues, a ratio of 1.95 to 1 advancing. There were 241 new highs and 9 new lows.
Advancing volume was higher at a ratio of 2.72 to 1. The closing TRIN was 0.72 and the final tick was 822.
Evidence of trend:
Relative to the previous 30 session average, volume was -11.42% below the average. Of the last 15 sessions 2 sessions ended with volume greater than the previous rolling 30 day average volume. Of the last 30 sessions, 28 sessions ended on a positive tick, 10 of last 10.
Remember: Breadth leads, indices follow. Today, the NYSE Advance/Decline line increased from 202273 to 203261. This 0.49% increase came while the SPX was gaining 0.51%. The 10 day moving ratio of positive volume is 1.23 and the 10 day moving Advance/Decline ratio is 1.28. The 10 day moving ratio of positive volume has trended -0.52 over the last three days and the 10 day moving Advance/Decline ratio has trended -0.27 over the last three days.
The NYSE Composite Index gained 0.44% today.
Tuesday, March 23
Economics
10:00 Existing Home Sales 5.00M cons.
10:00 FHFA Home Price Index -2.0% cons.
05:30 Great Britain CPI
07:50 Japan Merchandise Trade
Earnings
Before: CCL, KBH, SCS
After: ADBE, DRI, JBL, PRGS, SONC
Auction
01:00 2-Yr Note Auction
Speeches
03:00 Janet Yellen
The February Existing Home Sales index from the National Association of Realtors is due out in the morning. Sales are expected to have fallen to a 5 million unit annualized rate, according to estimates, from a 5.05 million unit annualized rate in January. The FHFA Home Price index is also due out in the morning.
Mel’s Random Hits:
• Total tick for the day was 230,000. There were 153 ticks greater than 600 and 9 ticks more extreme than -600. There were 3 ticks greater than 1000 and 0 ticks more extreme than -1000. The tick action suggests institutional accumulation.
• The day's range was 14.94 points. The 5 DMA of daily range is 11.33.
• Evidence of the intraday trend: At 10am volume was 92.71% of the 10 day average. By noon the volume was 91.06% of the 10 day average, and by 2pm volume was 89.81% of the 10 day average.
• The day's volume was 82.6% of the average daily volume for the last year. Volume was 87.3% of the last 10 day average and 81.2% of the previous day’s volume.
• 13% of the SPX stocks closed with two day RSI above 90. 23% closed with RSI above 80. 17% closed with RSI below 20 and 8% closed with RSI below 10.
• 60.6% of the SPX are above their five day moving average, 74% are above their 10 day average, and 87.6% are above their 20 day moving average.
• 24% of the SPX closed above their most recent previous high.
• 10% of the SPX stocks closed below their most recent previous lows.
• 165 SPX issues advanced and 147 issues declined, a net SPX advance/decline of 18.
• Evidence of the intraday trend: At 10am, 84.8% of the SPX components were in the top half of the range. By noon, 84.2% were in the top half of the range, and by 2pm, 85% were in the top half of the range.
• 84.6% of stocks closed in the top half of the day's range. (15.4% closed in bottom half.)
• 26.6% of stocks closed in the top 10% of the day's range. 54.6% of stocks closed in the top 20% of the day's range.
• 2.2% of stocks closed in the bottom 10% of the day's range. 4.2% of stocks closed in the bottom 20% of the day's range.
• 35.2% of stocks closed within 2% of their 52 week high. 57.8% of stocks closed within 5% of their 52 week high.
• 35.8% of stocks closed within 50% of their 52 week low. 9.2% of stocks closed within 25% of their 52 week low.
• 27.8% of stocks closed within ¼% of their high for the day.
• 4.8% of stocks closed within ¼% of their low for the day.
• Evidence of the intraday trend: At 10am, 49.2% of the SPX components were up since the open. By noon, 66.6% were up since the open, and by 2pm, 72.2% were up since the open.
• 73.4% of the SPX closed up from the previous close; 87.4% closed higher than the open.
• Sectors stronger than the SPX for Monday:
- Basic Materials -- Outperformed the SPX by +104%.
- Financials -- Outperformed the SPX by +7%.
- Technology -- Outperformed the SPX by +19%.
- Health Care -- Outperformed the SPX by +5%.
- Consumer Discretionary -- Outperformed the SPX by +89%.
• Sectors weaker than the SPX for Monday:
- Energy -- Underperformed the SPX by -86%.
- Industrials -- Underperformed the SPX by -15%.
- Consumer Staples -- Underperformed the SPX by -0%.
- Utilities -- Underperformed the SPX by -118%.
• The $SOX index strength was stronger relative to the SPX Monday by 1.91%.
• The XLF outperformed the SPX by 0.07% Monday.
• The 2 Day RSI of the SPX is 73. The Dow RSI is 79, the NASDAQ is 71 and the Russell is 64.
• Over the last four sessions, the average session closed 63.37% of the range above the low. Monday closed at 86.5% of the daily range.
• Upside momentum decreased marginally Monday, from Friday’s 0.68 to today’s 0.67. The ratio of SPX components giving a crossover buy signal compared to sell signals also decreased slightly to B 15.32 to 1.
• The ISEE Equity 10 day moving average Monday was 200.6. 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 207.3 on 01/19/10.
• 202 SPX components moved upward and 137 components downward during the after hours with 61 million shares traded.
Good trading on Tuesday everyone!
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"Mel"
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