From Briefing.com: Market mixed after Philly Fed. Dec Philadelphia Fed manufacturing index rose 1.1 points to 7.2 despite declines in both new orders and shipments. Prices received returned to positive growth at 0.1 as prices paid rose to 15.1. Employment also fell lower to -5.7... The Dow (-23) initially pushed into positive territory following the report, but has quickly given up ground
11:14AM S&P 500 testing 100-day simple moving avg : -- Technical -- Index trading towards its worst levels, testing its 100-day simple moving avg (888) after failing to clear its 50-day simple moving avg (897) earlier in the session. On a violation of the 100-day sma at 888, look for initial support at 883 followed by an additional floor at 875. To the upside, look for initial resistance at 891 followed by more important overhead at 897.
9:49AM Atmel rises following upgrade (ATML) 2.70 +0.16: Stock lifts 6.5% in early trading. Contributing to advance is an Investec pre-market upgrade to HOLD from Sell. Upgrade follows stock reaching Investec's price target of $2.50
9:56AM Technical Levels : With yesterday's close at 1361.5, the Nasdaq just edged out its 50-day simple moving average at 1361.2. Now as the chart below illustrates, the index hasn't closed below its 50-day simple moving average since October 16th. That's just over two months ago, and also note that it happens to be less than one week subsequent to the market bottom tagged on October 10th.
Now when we reviewed the Nasdaq yesterday, we addressed the issue of this trading range in the general vicinity of 1362 to 1411. It's worth noting that yesterday's close at 1361 essentially matched the lower end of that range. Yet the broader take away in yesterday's piece was the markets have experienced a drop in volatility which can ultimately lead to a substantial break in either direction. So now that the Nasdaq is resting more or less on its 50-day simple moving average, how do the markets look from here?
There is no questioning that the price action was weak yesterday and the pullback came on 1.5 billion shares. That volume figure remains on the light side relative to its two-month range but would qualify as somewhat heavier if you were to look at just the past two weeks -- roughly the duration of this recent pullback. Those making the bearish case could also point towards two separate random considerations. Namely, that both gold and oil have been rising of late with the price of crude putting some distance on the $30 per barrel mark yesterday.
Yet also keep in mind that tomorrow's session marks the first ever 'quadruple witch' for the markets. The quadruple witch carries its name because it represents the expiration of four different investment/trading vehicles -- options, futures, options on futures, and the more recently created single-stock futures. Note that this is the first ever expiration for single-stock futures which is the reason tomorrow's session, which would have been called a 'triple witch' in the past, will now go by the moniker 'quadruple witch'.
At any rate, the expiration means each of these four investment vehicles cease to exist after Friday which forces the capital committed to them to find a new home. As a rule, this rotation generates additional volume and volatility in the markets, which brings us to the reason we raise this issue in the first place.
Throughout the October to November rally, the markets managed sizeable gains and the moves were consistently confirmed by notably strong relative volume. Then we came to this early December pullback which has been undertaken on generally puny volume. On its face, this recent consolidation phase has looked more like it lacked a bid than anything resembling aggressive sell pressure.
Under the current circumstances, you would conventionally expect a bounce off this initial test of the Nasdaq's 50-day simple moving average -- that's what we expect in this instance. Just as we were unimpressed by the recent closes at the top of our trading range, we don't see much reason for concern over yesterday's close at the bottom of the range. Yet keep in mind tomorrow marks that quadruple witch, suggesting Friday's price action should contribute disproportionately to the very near-term technical picture.
From the standpoint of the straight technical levels, the overall picture is not substantially different from yesterday's assessment. On a near to intermediate-term basis, the immediate bias will improve or deteriorate based on the Nasdaq's relationship to the following key levels: 1) the 1360 level which approximates the index' 50-day simple moving average and also represents the bottom of a recent gap, 2) the 1380 level which currently represents the Nasdaq's 20-week exponential moving average and also ties in to that longer-term straight-line pivot point discussed yesterday, 3) the 1396 level which currently represents the Nasdaq's 20-day exponential moving average, and 4) our well documented straight-line resistance of 1423.-- Mike Ashbaugh, Briefing.com
7:45AM SEMI book-to-bill comes in at 0.79 : SEMI reports that the book-to-bill for semiconductor equipment manufacturers came in at 0.79 for Nov. This figure is ahead of Salomon Smith Barney's forecast of 0.71. The Oct reading was revised to 0.78 from 0.73.
finance.yahoo.com^SOXX+ALTR+AMAT+AMD+ATML+BRCM+INTC+KLAC+LLTC+LSCC+LSI+MOT+MU+MXIM+NSM+NVLS+TER+TXN+XLNX+^IXIC+^NDX+^SPX+^VIX+^VXN+SMH&d=t
stockcharts.com[h,a]daclyyay[pb50,200!d20,2!c20!c10!c200][vc60][iUb14!Uk14!La12,26,9!Ld20]&pref=G
I see the NASDAQ 50 day SMA at 1366 and moving higher. The market is in the process of rolling over. A close above 1366 is necessary to give us any hope it will not continue downward in my opinion.
RtS |
