Monday, June 30, 2014 9:10 a.m. BEFORE the OPEN
Stock prices stabilized last week and for the Nasdaq Composite even began to surge upward, reflecting pressure on money managers to set the stage for improved performance for the second half of the year.
Q2 ends today, the last day to dump stocks fund managers don’t want to show as a holding and continue to accumulate ones they do (window dressing).
Last week’s stability indicates a comfort level with the economic reports released, but more are coming this week.
There is no doubt the economy is rebounding out of its winter crunch, the question now is – how much ?
So far, events in the Mid-East haven’t jolted the market.
So far, the Street is not concerned by the prospect that interest rates will rise sooner than the Fed has indicated.
Both are a real endorsement to the market’s underlying strength.
TODAY:
I have been looking for the market to enter a sideways trading range lasting until September, and that may still happen but starting at higher prices.
Either way, I see a tradable market for aggressive investors, but opportunity for well-timed buying by longer term investors.
We haven’t yet seen an untethered craving to gobble up stocks at any price.
Support today is DJIA:16,811; S&P 500: 1,956; Nasdaq Comp.: 4,388
Resistance todaystarts at DJIA 16,918; S&P 500: 1,964; Nasdaq Comp.: 4,408
Investor’s first read– Daily edge before the open
DJIA: 16,851
S&P 500: 1,960
Nasdaq Comp.: 4,397
Russell 2000: 1,189
Occasionally, I am asked why I do not refer to a lot of technical indicators. Well, I do monitor ones that have proven to be reliable.
In fact, I have written about most of these indicators long before they were well followed. A lot are redundant, a lot are BS, an attempt to quantify what is rarely quantifiable at key junctures.
What I want to accomplish here is to boil that data down into a quick read prior to the open.
Much of all this is common sense applied to years in the trenches in good and bad markets. A lot is simply judgment.
Buying low and selling high is complicated by human emotions– fear to step in at bargain prices when nobody else is willing to buy and to sell when everyone else is buying and making easy money.
TECHNICAL ANALYSIS of 30 DOW JONES INDUSTRIALS
(UPDATED ANALYSIS: June 27)
At key junctures, I technically analyze each of the 30 Dow industrials seeking a reasonable near-term support and a more extreme support level, as well as a short-term resistance level. By technically studying the balances of buying and selling in each stock, then converting that data back to the DJIA using the “divisor” (0.1557159) I can get a better reading on the average itself. The DJIA is a price-weighted average and subject to distortion by higher priced issues.
On June 26 the DJIA rebounded from 16,746, about halfway between my “reasonable and “more extreme” levels, prompting me to re-calculate the support/resistance levels again.
As of June 27, they are : Reasonable support: 16,726, more extreme support: 16,564 and Resistance: 17,109.
Note: My daily support/resistance levels are more short-term oriented.
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THIS WEEK’s ECONOMIC REPORTS:
Expect a full slate of reports in this shortened July 4 week with the key Employment Situation report coming at 8:30 Thursday, preceded by the ADP Employment report as usual on Wednesday.
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:
Chicago PMI (9:45):
Pending Home Sales (10:00):
Dallas Fed Mfg.(10:30):
TUESDAY:
Motor Vehicle Sales
ICSC Goldman Store Sales (7:45)
PMI Mfg Ix.(9:45):
ISM Mfg. Ix.(10:00):
Construction Spend.(10:00):
Global Mfg. PMI (10:00):
WEDNESDAY:
MBA Purchase Apps.(7:00)
ADP Employment (8:15):
Gallup US Job Creation Ix. (8:30)
Factory Orders (10:00):
THURSDAY:
Employment Situation (8:20):
International Trade (8:30):
Jobless Claims (9:30):
PMI Services Ix. (9:45):
ISM Non- Mfg. Ix. (10:00):
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RECENT POSTS:
June 12 DJIA 16,843 Sideways, 3-Month Trading Range Beginning ?
June 13 DJIA 16,734 Iraq Crisis to Create Buying Opportunity
June 16 DJIA 16,775 Uncertainty – A Menace to Stock Prices Near-Term
June 17 DJIA 16,781 Decision Day for Stock Prices – Near-Term
June 18 DJIA 16,808 Market Awaits a Fed QE Exit Strategy
June 19 DJIA 16,906 Wall Street Needs a Dose of Reality
June 20 DJIA 16,921 Spike Up Likely, No Room for Rally Failure
June 23 DJIA 16,947 Spike, Correction – Opportunity
June 24 DJIA 16,937 Market to React to Week’s Economic Reports
June 25 DJIA 16,818 Major Challenge for Bulls
June 26 DJIA 16,867 Again – Bulls Challenged
June 27 DJIA 16,846 Near-Term Tipping Point for Stock Prices
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 investment advice or 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.
