Small Caps, IWM,Lead Rally as SPX and NDX Rise but Pare Gains...

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Key observation today: Institutions are buying positive EPS results.

Thursday was day 3 of earnings season with twenty-one SP500 companies reporting after Wednesday’s close or before Thursday’s open.  AA, DOV, URI, CCI, NFLX, HON finished higher while IBM, TXT, MTB closed lower.  Thirteen of twenty-one stocks finished the day higher.  After day 3, thirty of forty-one EPS reactions have been positive at the close of the trading day.

After the close ETFC and ISRG had a positive earning’s reaction.

Upcoming:

Fri Oct 18 – Eleven SP 500 stocks report EPS

Wed Oct 30 – next FOMC Meeting Announcement

Thu Oct 31 – Brexit deadline

SPX closes at 2,997, down -0.80% from Sep 19th 3,021 high and up +4.97% from its Oct 3 low of 2,856. 

The SPX gained 8 points.  Look for the institutional short-term focus to continue to be on EPS reactions Friday on SPX stocks AXP, KO, ETFC, ISRG, KSU, SLB, STT, CFG, NVR, PBCT and SYF.

Our current technical assessment is an Aug – Oct (2,822 – 3,027) sideways channel with Thursday’s trading range forming a spinning top.  Price action is likely to continue fluctuating between 2,840 support and 3,020 resistance.

The DJIA, closed up 23 points at 27,025 led by strength in UNH, CAT, AXP, DIS and UTX.  Closing above 27,000 for the third day after closing below for seventeen straight days.

Ten of eleven sectors were higher on Thursday, led by XLV and XLRE.

SPY up .88 at 299.28 on 46.7 million shares, below average volume.  Upon lower volume.

VIX up .11 at 13.79

Oil up 1.23 at 54.20

TLT down .34 at 139.58 on 6.5 million shares.

GLD up .20 at 140.61

UNH, WBA, DOW led the DJIA, 20 advancers, +9

SWN, AA, DOV led the SPX, 332 advancers

NFLX, SWKS, XRAY, HSIC led the NDX, 63 advancers

Long term up trend intact.  3-day short term trend is up.

Up: IWM, SPY, QQQ, DIA,

Down:                                                                  

Breadth strengthened on Thursday as advancers led 1,934 to 992 on the NYSE and led 1,986 to 1,089 on the NASDAQ

The SPX MFC green line is below 80 and moved up to 77.  It is short-term bullish.

Uptrend sectors: XLU, XLRE, XLP, XLK,

Neutral sectors:  XLY, XLC, XLF, XLI, XLB, XLV,

Down trend sectors: XLE,

The 6-month intermediate trend is up.  The ten-day trend is up.

3-month Intermediate Term Market Trend: Sideways

3-day Short Term Market Trend: Up

63 of 100 NDX stocks closed higher on Thursday.

69 NDX stocks are above their 30 DMA:  KLAC, AAPL, ASML, DLTR, CTXS, HAS, ROST, CTAS, ALGN, ULTA, ATVI, CELG, CHTR, NVDA, PEP, XRAY, COST, LULU, ROST, SWKS, TSLA, AMAT, EXPE, FISV, ILMN, INTC, ISRG, LRCX, MSFT, ORLY, PAYX, TXN, AMGN, MCHP, NFLX, NXPI, ULTA, ADP, ATVI, CERN, FAST, GOOGL, IDXX, MXIM, NTES, PCAR, SIRI, WYNN, AAL, AMD, AVGO, BIDU, GILD, INCY, VRTX, BKNG, CMCSA, CSX, FB, ISRG, JBHT, JD, NTAP, QCOM, TMUS, UAL, WBA, AMZN, EA, HSIC, PEP,

NDX Stocks to Watch on Friday:

Moving Above 30 DMA = 3

EA, HSIC, PEP,

Moving Below 30 DMA = 4

CDNS, INTU, LBTYA, SNPS,

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