Thursday, September 25 , 2014 9:13 a.m. BEFORE the OPEN
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Daily:Boiling down fundamental, technical, economic,
monetary, fiscal, psychological, and seasonal data into a quick read.
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Yesterday’s surge is hard to deny. Prompted by the August 18% jump in new home sales, the market reversed more than half of its preceding three day loss. It was a powerful one-day reversal which reduces the likelihood of a near-term correction, for now.
I expected the Yellen “spike” after she announced interest rates would remain low for a considerable time last Wednesday, even believed it would offer a chance to raise cash. Friday, I questioned if the frenzy accompanying the Alibaba (BABA) IPO was a sell signal, and Tuesday warned that a rally would be risky.
Time will tell, but I must defer to the Street on this and accept the fact the correction lows set eight days ago and successfully tested yesterday are the source of significant support. A correction of any significance must break below the DJIA 16,937 (S&P 500: 1,978; Nasdaq Comp. 4,500) levels.
While yesterday’s surge was triggered by a surprise 18% jump in August New Home Sales, buyers must have been lurking as the major market averages slid down to mid-September lows ready to pounce given a reason. The New Home Sales report brought them in.
TODAY:
While yesterday’s surge did not erase the preceding three day slide, it clearlyputs the burden of proof in the Bears’ corner. Just how far the Bulls can move the ball from here will play out in coming days.
We know now, the Bulls are still very much interested in buying stocks on pullbacks.
Support today is DJIA: 17,137; S&P 500: 1,991; Nasdaq Comp.:4,536
Resistance today is DJIA: 17,273; S&P 500: 2,006; Nasdaq Comp.: 4,576
Investor’s first read– Daily edge before the open
DJIA: 17,210
S&P 500: 1,998
Nasdaq Comp.:4,555
Russell 2000: 1,128
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INTERNATIONAL TENSIONS:
Ukraine/Russia – quiet for now, but has the potential to get uglier.
ISIS/Iraq/Syria – A Euro/Mid-East coalition has formed to counter ISIL. A full-blown bombing mission has been undertaken, which stands to be ongoing. Psychologically, that stands to play well in America, which has been warned of future terrorist activity. The possibility of a major war resulting must be considered.
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THIS WEEK’s ECONOMIC REPORTS:
Big week for economic reports. For detailed analysis of both the U.S. and Foreign economies along with charts, go towww.mam.econoday.com. Also included is an explanation of each indicator. If you want to know when the next Employment report or any other key report will be released that info is also there under “event release date.”
MONDAY:
Existing Home Sales (10:00): Declined1.8 pct in Aug. Year/year is down5.3 pct.
TUESDAY:
ICSC Goldman Store Sales: Up 0.1 pct. from prior week. Year/year up 4.1 pct.
FHFA House Price Ix (9:00): July up 0.1 pct. vs. increase of 0.3 pct. June
PMI Mfg. Ix. (9:45): September“flash” 57.9 unchanged from final August
Richmond Fed Mfg. Ix. (10:00): September index 14 vs. 12 August
State Street Investor Confidence Ix (10:00):
WEDNESDAY:
MBA Mtge Purchase/Refi Ix.(7:00): Purchases down 0.3 pct. in Sept 19 week; Year/year down 16 pct. Refi’s down 7 pct.
New Home Sales (10:00): Aug sales surged 18.0% to a 504,000 annual rate. Data reported yesterday was for July.
THURSDAY:
JoblessClaims(8:30): Rose 12,000 to 293,000 in Sept. 20 week
Durable Goods (8:30): Down 18.2pct. in Aug.; Ex-Trans+0.7pct.
PMI Svcs flash Ix. (9:45):
Kansas City Fed Mfg Ix (11:00)
FRIDAY:
GDP (8:30):
Corporate Profits (8:30):
Consumer Sentiment (9:55):
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RECENT POSTS:
Sept. 8 DJIA 17,173 Bullish Storm Surge Imminent ?
Sept. 9 DJIA 17,111 Bulls to be Tested Today
Sept. 10 DJIA 17,013 Stock Market Back on the “Edge”
Sept, 11 DJIA 17,068 Last Chance for Bulls to Avoid Crunch
Sept. 12 DJIA 17,049 The Fed, Elections, Geopolitics Stymie Bulls
Sept. 15 DJIA 16,987 A Brief Yellen Rally This Week ?
Sept. 16 DJIA 17,031 Street Keying on Yellen’s Wednesday Comments
Sept. 17 DJIA 17,131 Yellen Rally Risky – Raise Some Cash
Sept. 18 DJIA 17,156 Will BIG Money Sell Into Strength ?
Sept. 19 DJIA 17,265 Alibaba Frenzy – a Sell Signal ?
Sept. 22 DJIA 17,279 Another Test for the Bulls
Sept. 23 DJIA 17,172 Rally Now Would Be Risky
Sept, 24 DJIA 17,055 Critical Crossroads for Money Managers
*Stock Trader’s Almanac
A Game-On Analysis, LLC publication
George Brooks
“Investor’s first read – a daily edge before the open”
Investor’s first read, is a Game-On Analysis,LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment decisions in keeping with their tolerance for risk.
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