Tuesday, September 30, 2014 9:03 a.m. BEFORE the OPEN
…………………………………………………………………………………
Daily: Boiling down fundamental, technical, economic, monetary, fiscal, psychological, and seasonal data into a quick read.
……………………………………………………………………………………………………
The Bulls accounted for themselves quite well yesterday, initially reversing across-the-board selling that lopped off as much as 179 points from the DJIA in early trading.
Call it volatility, a turf war between Bulls and Bears, a technical correction, or quarter-ending window dressing; this market action sets the stage for a sharp move one way or the other.
Based on the market’s action during the last two days, the Bulls have a slight edge. Today is the last day for sales and purchases by money managers in Q3. Tomorrow begins Q4 and a series of sales and purchases that will not show up in Q3 reports.
TODAY:
Support: The 16,934 area has provided solid support for the DJIA, as has 1,965 for the S&P 500 and 4,465 area for the Nasdaq Comp. Breaking below these levels would raise odds of a sharp plunge, possibly back to the August lows (DJIA: 16,333; S&P 500: 1,911; Nasdaq Comp.: 4,321).
Resistance: While the support levels noted above are well defined, resistance levels have edged downward over the last three days and are less easily defined.
An early warning of a sharp rally would be a break above DJIA 17,150 (S&P 500: 1,987).
There is a chance here for a powerful rally. The catalyst would be the outlook for earnings over the next nine months. If bright, the Street will overlook known negatives (Russia/Ukraine, ISIS, the Fed, slow growth in China). If outlook is uncertain, a rally would have limits, opening the door for the Bears.
Assuming a correction in stock prices was overdue, it is important to note that the churning market action over the last seven trading days serves a similar purpose – selling is absorbed by buying, but without serious damage.
Investor’s first read– Daily edge before the open
DJIA: 17,071
S&P 500: 1,977
Nasdaq Comp.:4,505
Russell 2000: 1,117
TECHNICAL ANALYSIS EACH of 30 DOW INDUSTRIALS (9/25 close)
By technically analyzing each of the 30 Dow industrials then using the Dow “divisor” to convert the data back into the DJIA, I can get a better read on what is primary support and a secondary support.
As of the 9/25 close: Resistance: 17,141; Primary Support: 16,746; and Secondary Support: 16,454.
The resistance and support levels listed daily may differ, since they are shorter term.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
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.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
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 to www.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:
Personal Income/Outlays (8:30): Personal income rose 0.3 pct. in Aug. after a 0.2 pct rise in July.
Pending Home Sales Ix. (10:00): Down 1.0 pct in Aug. vs 3.3 Pct. in July.
Dallas Fed Mfg. Ix. (10:30): Rose to 17.6 pct. in Sept. from 6.8 pct in Aug.
TUESDAY:
ICSC Goldman Store Sales (7:45): Sales dropped 0.2 pct. in Sept. 27 week vs. 4.1 pct. rise in the prior week. Year/year up 3.6 pct.
S&P Case Shiller Home Prices (9:00):
Chicago PMI (9:45):
Consumer Confidence (10:00):
State Street Investor Confidence Ix. (10:00):
WEDNESDAY:
MBA Purchase/Refi Apps (7:00):
ADP Employment Rpt (8:15)
PMI Mfg. (9:45):
ISM Mfg. Ix. (10:00)
Construction Spend (10:00):
THURSDAY:
Jobless Claims (8:30):
Factory Orders (10:00):
FRIDAY:
Employment Situation (8:30):
Int’l Trade (8:30):
PMI services (9:45):
ISM Non- Mfg Ix. (10:00)
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
RECENT POSTS:
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
Sept. 25 DJIA 17,210 Back to Tug of War – Bulls vs. Bears
Sept 26 DJIA 16,945 Moment of Truth for Market’s Direction
*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.
