Pullback?? Was That It?
by Jerome "Mel" Hickerson
There was no economic data before the open today but easing concerns about volcanic ash disrupting commerce in Europe as well as a surprising surge in investor sentiment in both the Europe and Germany lifted spirits before the open in the U.S. The major overseas markets were split with Asia finishing mixed and European markets rallying. Futures pointed to a higher open.
The session opened with a small gap upward but was up about seven points with a couple of moments. There was a small decline going into the 10:30 timeframe but the SPX climbed back upward gently over the next 90 minutes. The final four hours was gentle sideways trade within a two point trading range. This was not a day made for day trading the indices.
The resilience of this market has many shaking their head in disbelief, frustrated beyond belief. Market breadth today rebounded much more strongly than the +25 on the DOW would cause you to think. There are many things within the internals still causing me to suspect a pullback is imminent but I can't deny that some of those things are fading away while the market is not. But one thing I do know about the market: When everyone gives up on looking for a pullback, then it will happen.
Our trade systems were mostly silent today as the largest part of the day simply had no volatility in which to day trade.
Trade Idea for Wednesday: With any gap upward of three points or more, fade the gap.
Day Trade Systems Update: (Signals today)
* SMN at: 12:02
SPX Summary for Tuesday, April 20, 2010
421 Advancers/69 Decliners
Today's SPX component winners and losers:
• Largest one day loser is AKS with -7.06%
• Largest three day loser is GS with -13.24%
• Largest five day loser is AKS with -14.38%
• Largest ten day loser is AKS with -22.60%
• Largest one day winner is MI with 10.81%
• Largest three day winner is SNA with 7.27%
• Largest five day winner is IPG with 12.85%
• Largest ten day winner is AIG with 16.15%
*** SPX Technical Summary ***
The lowest 14 day RSI component is AET; the highest 14 day RSI component is BDK. The average 14 day RSI of all 500 components is 61.
The greatest positive five day momentum component is IPG; the greatest negative five day momentum component is AKS. The average five day momentum of all 500 components is 1.04.
62.20% of the SPX components are giving a crossover Buy signal; 14.40% of the SPX components are giving a Sell signal. This is a 4.3 to 1 ratio of Buy signals over Sell signals.
SPX component signal changes today (evidence of trend):
• From Sell to Neutral: 6 components.
• From Buy to Neutral: 22 components.
• From Neutral to Sell: 15 components.
• From Neutral to Buy: 20 components.
The moving averages:
Close 1207.17
9 EMA 1200.93 Rising
5 DMA 1203.83 Rising
10 DMA 1197.62 Rising
20 DMA 1186.06 Rising
50 DMA 1146.07 Rising
100 DMA 1128.98 Rising
200 DMA 1078.26 Rising
10 Wk MA 1159.64 Rising
NYSE Summary
On the NYSE 3206 issues were traded with 2529 advancing issues and 575 retreating issues, a ratio of 4.40 to 1 advancing. There were 295 new highs and 4 new lows.
Advancing volume was higher at a ratio of 4.61 to 1. The closing TRIN was 0.95 and the final tick was 648.
Evidence of trend:
Relative to the previous 30 session average, volume was 3.81% above the average. Of the last 15 sessions 8 sessions ended with volume greater than the previous rolling 30 day average volume. Of the last 30 sessions, 24 sessions ended on a positive tick, 8 of last 10.
The 5 day moving average of New Highs is 342 while the 5 day moving average of new lows is 8 and the 10 day moving average of Net Advancing is 214. The Net Advancing data indicates a bullish trend.
Remember: Breadth leads, indices follow. Today, the NYSE Advance/Decline line increased from 207555 to 209509. This 0.93% increase came while the SPX was gaining 0.8%. The 10 day moving ratio of positive volume is 1.08 and the 10 day moving Advance/Decline ratio is 1.15. The 10 day moving ratio of positive volume has trended 0.01 over the last three days and the 10 day moving Advance/Decline ratio has trended -0.03 over the last three days.
The NYSE Composite Index gained 0.96% today.
NYSE Statistics:
Absolute Breadth Index: 26.10 down from previous day of 28.74
Cumulative Volume Index: 82,090.53 up from previous day of 78,008.10
High Low Logic Index: 0.62 down from previous day of 0.73
McClellan Oscillator: (3.20) up from previous day of (112.16)
McClellan 10 DMA: 9.20 down from previous day of 19.01
McClellan Summation Index: 3,505.27 down from previous day of 3,508.52
% Stocks Above 200 DMA: 87.42 up from previous day of 85.91
% Stocks Above 40 DMA: 80.36 up from previous day of 76.55
New High / New Low Ratio: 98.38 up from previous day of 92.47
26wk New High/Low Ratio: 96.76 up from previous day of 83.25
13wk New High/Low Ratio: 96.95 up from previous day of 78.10
4wk New High/Low Ratio: 90.04 up from previous day of 40.04
Cumulative 4-Week New Hi-Low: 442,699 up from previous day of 442,240
Nasdaq Adv/Decline: 1,778 up from previous day of 1,728
Russell 1000 Advance/ Decline Line: 2,720 up from previous day of 2,649
Russell 2000 Advance/ Decline Line: (1,552) up from previous day of (1,624)
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).
Wednesday, April 21
Economics
10:30 Crude Inventories
07:50 Japan Merchandise Trade
Earnings
Before: ABT, MO, T, BA, CNH, CMA, ELN, EMC, ECA, FCF, GENZ, HBAN, KEY, NITE, LMT, LUKF, MCD, MCO, MS, NVR, NYB, PJC, PII, DGX, R, STJ, STI, TIN, UTX, WFC
After: AFFX, AMGN, CMG, CTXS, CVA, ETFC, EBAY, WIRE, EQIX, FFIV, HCBK, NFLX, NTGR, NE, NVLS, PTC, PTP, QCOM, RJF, SNDK, SBUX, TEX, VRTX
The government's weekly crude oil inventories report is due in the morning.
Mel’s Missives from the Matrix:
• Total tick for the day was 392,000. There were 183 ticks greater than 600 and 9 ticks more extreme than -600. There were 4 ticks greater than 1000 and no ticks more extreme than -1000. The tick action suggests institutional accumulation.
• The day's range was 9.54 points. The 5 DMA of daily range is 13.14.
• Evidence of the intraday trend: At 10am volume was 121.13% of the 10 day average. By noon the volume was 103.07% of the 10 day average, and by 2pm volume was 101.23% of the 10 day average.
• The day's volume was 106.7% of the average daily volume for the last year. Volume was 99.6% of the last 10 day average and 78% of the previous day’s volume.
• Evidence of the intraday trend: The largest increase in relative volume came between 12:00 and 12:15 when relative volume increased 28.6% while the SPX was rising 0.12%. The largest drop in relative volume came between 1:00 and 1:15 when relative volume dropped -26.2% while the SPX was dropping -0.02%.
• 10% of the SPX stocks closed with two day RSI above 90. 26% closed with RSI above 80. 8% closed with RSI below 20 and 4% closed with RSI below 10.
• 67% of the SPX are above their five day moving average, 69.4% are above their 10 day average, 78.2% are above their 20 day moving average, 88.8% are above their 50 day moving average, and 88% are above their 100 day moving average.
• 60% of the SPX closed above their most recent previous high.
• 3% of the SPX stocks closed below their most recent previous lows.
• 421 SPX issues advanced and 69 issues declined, a net SPX advance/decline of 352.
• Evidence of the intraday trend: At 10am, 55.8% of the SPX components were in the top half of the range. By noon, 66.2% were in the top half of the range, and by 2pm, 67% were in the top half of the range.
• 71.4% of stocks closed in the top half of the day's range. (28.4% closed in bottom half.)
• 26% of stocks closed in the top 10% of the day's range. 42.4% of stocks closed in the top 20% of the day's range.
• 1.4% of stocks closed in the bottom 10% of the day's range. 6.6% of stocks closed in the bottom 20% of the day's range.
• 38.8% of stocks closed within 2% of their 52 week high. 64.2% of stocks closed within 5% of their 52 week high.
• 38.8% of stocks closed within 50% of their 52 week low. 9.6% of stocks closed within 25% of their 52 week low.
• 33.6% of stocks closed within ¼% of their high for the day.
• 4.2% of stocks closed within ¼% of their low for the day.
• Evidence of the intraday trend: At 10am, 83% of the SPX components were up since the open. By noon, 81.6% were up since the open, and by 2pm, 81% were up since the open.
• 84% of the SPX closed up from the previous close; 71.6% closed higher than the open.
• Sectors stronger than the SPX for Tuesday:
- Energy -- Outperformed the SPX by +112%.
- Financials -- Outperformed the SPX by +57%.
- Industrials -- Outperformed the SPX by +18%.
- Utilities -- Outperformed the SPX by +42%.
- Consumer Discretionary -- Outperformed the SPX by +40%.
• Sectors weaker than the SPX for Tuesday:
- Basic Materials -- Underperformed the SPX by -41%.
- Technology -- Underperformed the SPX by -27%.
- Consumer Staples -- Underperformed the SPX by -53%.
- Health Care -- Underperformed the SPX by -50%.
• The $SOX index strength was stronger relative to the SPX Tuesday by 0.72%.
• The XLF outperformed the SPX by 0.57% Tuesday.
• The 2 Day RSI of the SPX is 73. The Dow RSI is 70, the NASDAQ is 71 and the Russell is 71.
• Over the last four sessions, the average session closed 66.04% of the range above the low. Tuesday closed at 84.3% of the daily range.
• Upside momentum increased Tuesday, from Monday’s -0.09 to today’s 1.04. The ratio of SPX components giving a crossover buy signal compared to sell signals decreased to B 4.33 to 1.
• The ISEE Equity 10 day moving average Tuesday was 239.1. 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.
• 205 SPX components moved upward and 178 components downward during the after hours with 147 million shares traded.
Trade 'em well on Wednesday everyone!
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"Mel"
