Wednesday, January 28, 2015

FOMC Reaction Sends Stocks Lower Falling Towards Short-term Support...

All nine sectors moved lower on Wednesday…XLK, XLU and XLI were the strongest sectors and XLE was the weakest.
 
Breadth weakened as decliners led advancers 2.81 to 1 on the NYSE and 2.99 to 1 on the NASDAQ.

Wednesday – weakened, decliners led
Tuesday – weakened, decliners led
Monday – strengthened, advancers led
Friday – weakened, decliners led
Thursday – strengthened, advancers led


SPY down 2.60 at 200.14 on 168.5 million shares
VIX up 3.22 at 20.44…
TNX down 1.01 at 17.24…
TLT up 2.20 at 136.77...
XLF down .43 at 23.20 on 69.3 million shares

AAPL up 6.17 at 115.31 on 146.4 million shares
FB up .46 at 76.24…on 53.3 million shares

Technical Commentary:
QQQ -0.51%, DIA -1.08%, SPY -1.28%, IWM -1.69%.

Good news was bad news for stocks as the Fed indicated that the economy was growing “at a solid pace.”  Some took this as an indication that the Fed may look to raise rates as soon as June.  This mindset seems reminiscent of the market reactions that occurred about a year and a half ago as speculation began to rise that the Fed would bring its QE asset buying program to an end.  Ultimately, the Fed did bring QE to an end which turned out to be neither negative for the economy or the stock market

While today’s reaction is likely to be short-term in nature, traders must take defensive action as stocks move lower to support.  Also interest rate weakness is having an impact on financial stocks which are rolling over.

The NDX -25.12 points was led lower by MSFT, GILD, CMCSA, AMGN, GOOG, BIDU and INTC. 

Positive earnings reactions from FSL +4.18, 18.25%, EA +6.20, +12.81%, TUP +6.93, +11.60%, X +2.31, +10.86%, AAPL +6.18, +5.65%, JNPR +0.82, +3.76%, and WDC +2.20, +2.25% provided some of the strongest positive reactions thus far this earnings season.

SPX dropped on weakness in energy stocks as crude inventories continued to rise.  NBR, DNR, HES, NOV, MUR, NE, PXD, HP, QEP, DVN, CHK, APA, EOG and MRO all dropped more than -5% on the news.  XLE -3.06, -3.94% was the weakest sector.

After the close QCOM -5.87, -8.27%, FB -1.39, -1.82%, VRTX -2.15, -1.77%, TSCO -0.75, -0.94% moved lower on earnings reactions.

IWM which has been the strongest market segment recently reversed on Wednesday and was led lower by weakness in RSPP, SLCA, MTDR, PE, UMBF, DYAX, SYRG, AGIO, XON, PDCE, ISIS and BCRS.


RUT Movers:  ADVS, JJSF, FCNCA

Trade with the trend of the chart you are trading and continue to move your profit protection stops.  Continue to follow your rules.


Short-term Chart Targets:
SPY = 202.15, 203.83, 205.06...
QQQ = 102.01, 103.17, 104.58
IWM = 117.84, 119.19, 119.45…

Support Levels
SPY = 200.20, 198.55, 196.77...
QQQ = 100.48, 99.36, 97.94
IWM = 116.57, 115.32, 114.20...


Earnings this week:
Monday:  MSFT, STX, TXN, ZION
Tuesday:  AAL, AAPL, AMGN, EA, ILMN, WDC, YHOO, FSL, GLW, JNPR, TSS, X,
Wednesday: FB, LRCX, QCOM, TSCO, TUP, VRTX, CAVM
Thursday:  ALXN, AMZN, BIIB, BRCM, CELG, CHKP, MAT, VIAB, WYNN, MCHP, BABA, BX, HOG, JDSU, RCL, SWI,
Friday:  PCAR

Q4 Earnings Reaction
Positive Reactions – AAPL, EA, FSL, GLW, JNPR, TSS, TUP, WDC, X, NFLX, ALK, BHI, CREE, DAL, EBAY, ETFC, GE, HON, KMB, LUV, MXIM, SBUX, SWKS, TRV, UAL, UNH, UNP, SNX, LLTC, TSM

More than 10% - NFLX, FSL, EA, TUP, X

Negative Reactions – QCOM, YHOO, MSFT, STX, AAL, ZION, AXP, ALTR, FFIV, IBM, ISRG, JNJ, KLAC, KSU, MCD, STT, XLNX, AA, BAC, C, JPM, KBH, WFC,

More than -10% - FFIV, KBH,

Reversal in progress – BAC, C, IBM, JNJ, JPM, 

Reversal of Initial Reaction – WFC


The SPX Market Forecast is pointed down at 56.

___________________

Setups
Horizontal Breakout: IWM, MGM, TXN, KKD, TSL, FSLR, SSYS, PANW,
Diagonal Breakout: AMBA, MBLY, JCP,
Bull Flag: KRFT, MNST, AVGO, CTRP, GLD, LOCO, MFRM, NTES, DAL, AAL, MAR, EBAY, GRMN, EBAY, ETFC, STI, Z, FEYE, KEY, CREE, JNUG, GDX,
Gap Up:  CAVM             
Gap Down: FB, QCOM, TSCO, VRTX
Bear Flag: BBY, GOGO, GPRO, LC,
At Support: MU, BAC, C, CMGE, CSIQ, FAS, IBM, MS, TWTR

Moves
New Highs: BX, SWKS, TLT,  
H Breakout: JD
Bull Flag Bounce: VXX
Gap Up:  FSL, EA, X, AAPL, JNPR,    
Support Break: AIG, CAR, EMC, HPQ, RAX, SPLK, UBNT, ZION,


______________________

11 out of 100 NDX stocks closed higher on Wednesday.


Leading NDX 100 stocks included: EA, AAPL, WDC, MAT, NXPI, ATVI, STX, FB, MNST, AVGO

Lagging NDX stocks included: VIP, AAL, CHTR, MSFT, LMCA, TSLA, YHOO, BIDU, CMCSA, ADSK

Leading stocks > +2% on Wednesday: X, VXX, JNPR, JD

Lagging stocks < -2.0% included: JUNO, MBLY, FEYE, FAS, YELP, SUNE, TWTR, SPWR, BABA, GOGO, UBNT, BBRY, Z, XONE, SPLK, RCL, ZION, SCHW, TSL, EMC, CSIQ, CMGE, JASO, CREE, BAC, ETFC, STI, CAR, AIG, CRM, C, LC, MS, JCP, GLW, SCTY


Stocks to Watch on Thursday
Holding Above 30 DMA = 36
WFM, SIAL, KRFT, MNST, SRCL, AVGO, HSIC, CTSH, FISV, NXPI, SIRI, CELG, ATVI, BIIB, CERN, CTRX, EA, GILD, NFLX, VOD, VRTX, ILMN, TXN, BBBY, LRCX, LVNTA, SBAC, SBUX, AMZN, DLTR, EXPD, ROST, TSCO, VRSK, ORLY, WYNN

Moving Above 30 DMA = 1
AAPL

Moving Below 30 DMA = 15
AAL, ADP, BIDU, CHKP, CHRW, DISH, GOOG, GRMN, LLTC, LMCA, MAR, MYL, PAYX, REGN, SYMC                     

Staying Below 30 DMA
ADBE, CA, CMCSA, COST, CSCO, DTV, EBAY, EQIX, ESRX, MSFT, NVDA, YHOO, FB, AMAT, FAST, GMCR, INTC, ISRG, KLAC, MDLZ, BRCM, VIP, SPLS, WDC, QCOM, STX, TRIP, ADI, AKAM, CHTR, DISCA, FOXA, LBTYA, PCAR, PCLN, VIAB, ADSK, MAT, MU,  ALTR, CTXS, INTU, NTAP, SNDK, AMGN, XLNX, ALXN, TSLA

6-month Intermediate Term Market Trend: Up
3-day Short Term Market Trend: Down

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