After-hours Alert: What was
known about the Brexit vote before it happened was that to stay in the EU was
status quo and certainty, to leave the EU was uncertainty and with that uncertainty
increased volatility. Brexit wins 51.89%
versus to stay 48.11% and world markets dropped amid the uncertainty of what it
really means.
All nine sectors moved higher on Thursday …XLF, XLE and XLB were the strongest sectors while was the weakest sector. Oil futures rose 1.13 to close at 50.13.
S&P futures dropped more than 100 points, VX volatility futures jumped more than10 points, GC gold futures jumped more than $100 and ZB bonds jumped more than 7 points.
While
nothing other than market reactions changes immediately, the UK now moves into
the process of negotiating the terms of the exit with the EU which will evolve
over the next few months leading to a process that may take up to two years to
complete.
Clearly
Thursday’s strong positive market action suggests that the net institutional
conclusion was the vote would be to stay in the EU. The conclusion was wrong. Market action discounts everything and as it
became clear that Brexit was winning markets discounted the surprise vote results by sending stock and
futures prices lower and volatility, gold and bonds higher.
Markets
generally sell off until prices get to a level that investors and traders are
attracted to buy by what they consider bargain prices as they did on Monday,
August 24, 2015. Now we will wait to see
at what levels buyers take advantage of lower prices.
All nine sectors moved higher on Thursday …XLF, XLE and XLB were the strongest sectors while was the weakest sector. Oil futures rose 1.13 to close at 50.13.
Breadth strengthened as advancers led 2,502
to 511 on
the NYSE and led 2,038
to 576 to on
the NASDAQ.
Thursday
– strengthened, advancers led, +9
Wednesday – weakened, decliners led, +3
Tuesday –
weakened, advancers led on the NYSE, +5
Monday – strengthened, advancers led, +8
Friday – strengthened, advancers led on the NYSE, +4
SPY up 2.71 at 210.81 on 102.7
million shares, 21% above average volume
VIX down 3.92
at 17.25
TLT down 1.53
at 132.23…on 9.0 million shares, 33% above average volume
Technical Commentary:
IWM +1.91%, QQQ +1.43%, SPY +1.30%, DIA
+1.26%,
Earning’s Announcements:
Positive Reactions: BBBY
Negative Reactions: RHT
Technical analysis based trades should be closed before earnings.
Trade
what you see, not…
Stocks below support should generally be traded bearishly until a reversal pattern forms.
Remember: “It’s
a market of stocks, not just a stock market.”
Trade with the trend of
the chart you are trading and
continue to move your profit protection stops. Continue to follow your rules.
The SPY MFC green line is pointed up at 68, bullish.
95 of 100
NDX stocks closed higher on Thursday.
76
NDX stocks are above their 30 DMA.
NDX Stocks to Watch on Friday:
Moving Above 30 DMA = 17
ADSK, AMZN, ATVI, BBBY,
CHTR, EA, EXPE, FAST, FISV, FOXA, ILMN, INCY, LVNTA, MDLZ, MSFT, PCAR, VOD
Moving Below 30 DMA = 0
6-month Intermediate
Term Market Trend: Neutral
3-day Short Term Market
Trend: Up
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