NDX, SPX Close Higher as Breadth Strengthened as Government Funding Moves Forward to Avoid Shutdown...Technology, Energy, Financial Lead All Sectors Higher...NVDA Leads DJI...

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SPX +117.42, 5,638, opened higher after futures rose overnight after Schumer had indicated that voting for, in his opinion, a bad GOP government funding bill was better than allowing a government shutdown.  A short-lived pullback occurred at 10 am ET after a lower-than-expected Consumer Sentiment was released.  After a 25 minute pause the buying rally continued and SPX resumed its uptrend day into the close.

Breadth strengthened as exchange advancers, index advancers, number of advancing sectors, mega cap stocks and net change capital all rose significantly.  At least on Friday, the passage of government funding seemed to outweigh concerns over potential tariffs, trade war concerns and recession fears as institutional buying was stronger than institutional selling.

Technical analysis is based on probabilities, never certainties.  No mortal knows the future including Warren Buffett, Jamie Dimon and everyone else.  You don’t know the future, I don’t know the future and it’s best to realize that and acknowledge that trading is NOT about knowing the future, it’s about knowing the present. 

We can see the present by seeing the trend, support and resistance, price patterns, momentum, setups, bounce and breakout entry signals on the chart, and know that our rule-based signals have a positive edge.  If we take the signal and manage the trade with discipline according to our rules, we know, based on the probabilities our rules, that we will get our fair share of winners over a series of trades.

On Friday, both SPY and QQQ moved above the high of the low day in a channel bounce on heavy institutional buying and the VIX fell.  A valid bounce signal.  Each trader now makes a probability decision about what they will do with the present.

The DJI, 41,488, +1.65%, opened higher, trended up to close above the high of the low day.  NDX +2.49% opened higher and closed higher above the high of the low day.

SMCI: +3.09, +7.91%, opened higher and closed above its 30 DMA.

TSLA +9.30, +3.86%, opened higher, traded in a range, formed a white hammer candle and again closed above the high of the low day.

INTC +0.35, +1.48%, after naming on Thursday Lip-Bu Tan as new CEO.

ULTA +43.01, +13.68%, after reporting an EPS and Sales beat, Thursday after the close. 

CCI +9.69, +10.37%, gapped up on a positive EPS reaction and trended up on Friday after upgrades from Keybanc and Raymond James.

Mega caps NVDA, TSLA, META, MSFT, AVGO, AMZN, BRK/B, AAPL, GOOGL, TSM rose on Friday. 

SPY up 11.39 at 562.89, 62.5 million shares, above average volume

VIX down 2.89 at 21.77

QQQ up 11.32 at 479.66

NVDA, AXP, JPM, GS led the DJIA, 24 advancers, +14

ULTA, CCI, PLTR, SMCI, CE led the SPX, 453 advancers,

MSTR, PLTR, APP, CRWD led the NDX, 93 advancers

Up: QQQ, IWM, SPY, DIA,

Down:

The SPY MFC green line is pointed down to 9.9 and is short-term bearish. –0.2.

All eleven sectors were higher on Friday, with led by XLK, XLE and XLF. 

Uptrend sectors: XLC, XLF, XLV,

Neutral sectors: XLP, XLY, XLI, XLU, XLRE, XLE,

Down trend sectors: XLK, XLB,

The 6-month intermediate trend is sideways.  The ten-day trend is down.

3-month Intermediate Term Market Trend:  Down

3-day Short Term Market Trend:  Up

93 of 100 NDX stocks closed higher on Friday.

22 NDX stocks are above their 30 DMA: CDW, ISRG, AEP, EXC, AMGN, AZN, GILD, VRTX, MDLZ, MNST, EA, KDP, PDD, MU, INTC, CMCSA, CSGP, FAST, INTU, KHC, ORLY, XEL,

NDX Stocks to Watch on Monday:

Moving Above 30 DMA = 7

CMCSA, CSGP, FAST, INTU, KHC, ORLY, XEL,

Moving Below 30 DMA = 1

TMUS,

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