Weak Open But Strong Close!

Byinfo@50park.com
SPX- Weak Open But Strong Close
SPX- Weak Open But Strong Close

Thursday, March 29, 2012
Stock Market Commentary:

Stocks and other risk assets fell on Thursday after the latest round of economic data missed estimates and fears emerged regarding the European  debt crisis. From our point of view, the major averages confirmed their latest rally attempt on Tuesday 1.3.12 which was Day 9 of their current rally attempt. Since then, stocks have been enjoying a very strong uptrend. The benchmark S&P 500 paused near its 2011 high (~1370) before moving higher and that level should now become support. The next level of support would be the 50 DMA line, then a deeper 5-9% pullback. It is important to note that the bulls remain in control of this market as long as the benchmark S&P 500 stays above its 50 DMA line.

Fear of an Economic Slowdown Hurts Stocks:

Stocks ended mixed on Thursday, recovering from a weak open, after fear spread regarding the global economic recovery, fresh EU debt woes, and weaker than expected economic data from the U.S.. European stock markets were smacked after workers in Spain went on strike to protect their austerity measures one day before their 2012 budget is slated to be released. Spain’s stock market, IBEX, fell to a four-month low while Italy’s also got hammered on debt woes. Meanwhile, two important economic reports missed estimates in the U.S. The Commerce Department said its final estimate for Q4 2011 GDP was unchanged at +3.0%. This was the strongest gain since Q2 of 2008 but missed the Street’s +3.2% estimate. Meanwhile, the Labor Department said weekly jobless claims fell by 5,000 to a seasonally adjusted +359,000 last week. Jobless claims fell to a four year low but missed the Street’s estimate of 350,000.

Market Outlook- Confirmed Rally

Risk assets (mainly stocks and a slew of commodities) are pulling back after a very healthy rally. This shallow pullback is considered healthy and shows how strong the bulls are at this point. However, if sellers show up and support is breached then the bears will have regained control of this market. As always, keep your losses small and never argue with the tape. If you are looking for specific help navigating this market, feel free to contact us for more information. That’s what we are here for!
Coming Up This Week:
WEDNESDAY: Weekly mortgage apps, durable goods orders, oil inventories, 5-yr note auction, Fed’s Bullard speaks, FDA discusses obesity drugs
THURSDAY: GDP, jobless claims, corporate profits, Fed’s Plosser speaks, 7-yr note auction, farm prices, Fed’s Lacker speaks; Earnings from Best Buy, Research In Motion
FRIDAY: Personal income & outlays, Chicago PMI, consumer sentiment, Stringer’s last day as Sony CEO
Source: CNBC.com

Similar Posts

  • Weak Economic Data Drags Stocks Lower

    Byinfo@50park.com

    Monday marked Day 2 of a new rally attempt which means the earliest a possible follow-through day (FTD) could emerge will be Wednesday. However, if at anytime, Friday’s lows (Day 1) are breached then the day count will be reset. The technical action in the major averages has recently been weak while the latest round of economic data has provided a poor outlook for the market and the global recovery. Currently, resistance for the the major averages are their 50-day moving average (DMA) lines, then their longer-term 200 DMA lines while support remains July’s lows. It is also disconcerting to see weakness in the financial group. Meanwhile, the action in leading stocks and fact that some high-ranked leaders are breaking out of sound bases can be considered somewhat encouraging. Still there is importance in remaining cautious until the major averages are back in a confirmed uptrend. Put simply, we can expect this sideways/choppy action to continue until the market breaks out above resistance or below support. The first scenario will have bullish ramifications while the second will be clearly bearish. Trade accordingly.

  • Stocks Slide On Possible Spain Downgrade

    Byinfo@50park.com

    Market Action- Market In Confirmed Rally Week 16
    It is encouraging to see the bulls show up and defend the 50 DMA lines for the major averages. The market remains in a confirmed rally until those levels are breached. The tech-heavy Nasdaq composite and small-cap Russell 2000 indexes continue to lead evidenced by their shallow correction and strong recovery. Put simply, stocks are strong. Trade accordingly. If you are looking for specific high ranked ideas, please contact us for more information.

  • Week In Review: Stocks On The Verge Of A Major Breakout

    Byinfo@50park.com

    The Bulls Are Getting Stronger 05.23.14 The bulls emerged victorious on Wall Street as they not only quelled the bearish pressure but also set the bullish stage for a very strong breakout. At its deepest this year, the S&P 500 only fell -6% below its record high which is impressive. In fact, we have not had a 10%…

  • Stocks Smacked as Germany Adds To EU Woes

    Byinfo@50park.com

    Market Outlook- In A Correction:
    The major U.S. averages are still in a “correction” as they continue to bounce towards resistance of their 2-month base. The latest follow-through day (FTD) which began on August 23, 2011 has officially ended which means we will continue “counting” days before a new rally can be confirmed. In addition, it is important to note that the bulls scored a victory since many of the major averages closed above their downward sloping 50 DMA lines for the first time since late July! The next stop is September’s highs and then their 200 DMA lines. Our longstanding clients/readers know, we like to filter out the noise and focus on what matters most: market action. If you are looking for specific help navigating this market, please contact us for more information.
    Fall Sale- We Will Double Your Order!!!
    Limited-Time Offer!
    www.FindLeadingStocks.com
    On Tap This Week:
    MONDAY: Industrial production, Fed’s Lacker and Evans speak; Earnings from IBM
    TUESDAY: PPI, treasury international capital, housing market index, Bernanke speaks; Earnings from BofA, Coca-Cola, Goldman Sachs, J&J, Apple, Intel, CSX and Yahoo
    WEDNESDAY: Weekly mortgage apps, CPI, housing starts, Fed’s Rosengren speaks, oil inventories, Fed’s Beige Book; Earnings from Morgan Stanley, Travelers, United Tech, AmEx, Ebay, Western Digital
    THURSDAY: Jobless claims, existing home sales, Philadelphia Fed survey, leading indicators, Fed’s Bullard and Kocherlakota speak, NewsCorp investor day; Earnings from AT&T, Eli Lilly, Nokia, AutoNation, Microsoft, Capital One, Chipotle and SanDisk
    FRIDAY: Fed’s Kocherlakota speaks, 2011 Dodd-Frank Rulemaking Deadline; Earnings from GE, McDonald’s, Verizon, Honeywell and Schlumberger
    Source: CNBC.com