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S&P now unchanged over last 10 days, w/ Tech weakness replaced by Financials

Quad witch expiration today-  eco data just released- Worse than expected..  Housing starts fall to 1.092k, est 1.22- and MoM -5.5% vs UP 4.1% exptd.   Building permit data also down- -4.9% v 1.7 expected.  NY Fed bus leaders survey falls to 3.4-  Little to no change in S&P and Treasuries still mildly lower with 10yr at 2.17% and Bund yields at .292.. Equities now are literally unchanged from 10 days ago on S&P..from back on 6/2-   Key to note-  pullback thus far  has not gained any traction outside of Technology, but obviously a very important sector and one to concentrate on-  Financials though have replaced Tech being higher by 2.4% this week, while industrials and Energy have also attempted to bounce-  For now into next week, will pay to still be bullish until/unless 2412 is violated.  and 2443 being important on the upside-  Premkt gainers in CLSN, HOS, FNSR, EMES, AUPH, VRX, HES, SM, OAS, NZNP, MBT.. while on downside-  IDXG, BAH, OAKS, NKE, KR-  Let me know if you have any questions

Market rebounding off early lows

Market steadily rebounding from early losses with breadth now only 2/1 negative.. both the Dollar and yields continue to climb while precious metals are being hit hard.   Industrials are positive on the day, along with Real estate, Telecom, Utes.. but Tech Materials, and Discretionary are leading the losses, down 0.70% with Energy a distant fourth -0.55%.    S&P and NASDAQ got close to, but did not violate last Friday lows (mon for NDX)  and since have snapped back with S&P near yesterday's lows at 2426-  Into tomorrow.  a close back up above yesterday's lows would be pretty compelling that markets might hold and try to turn back higher, but the weight of Technology will be a concern going forward and still looks like an Underweight.. so upside gains probably muted into July until this can consolidate and establish some footing yet again.  Leaders today:  HRB, ESS, CAT, IRM, ADM, XL, CHRW, AN, while on downside-  KR, MAT, WFM, NUE, UA, DG, all down 4% or more-  Let me know if you have questions

Precious Metals sinking on Dollar, Yields climbing

gm- Ahead of weekly jobless claims, Philly Fed.. indices negative globally with Europe down by 1% and HSI, HSCEI, NKY lower, while S&P and NASDAQ futures down by 0.60-1% respectively- Policy differences within BOE resulting in Gilt yields and Bund yields spiking higher to reverse yesterdays decline while US is following suit as US Dollar index also reverses yesterdays loss and turns up- Precious metals being hit hard on this as Gold giving all back of the last couple days gains and Silver, Palladium down more than 2%..   S&P meanwhile down to near make-or-break support with 2412 in Sept futures being important to hold and just fractionally below current levels-  NDX futures meanwhile down to just above Monday's 5643 lows and this ALSO will be an important area to monitor and can't get below this without causing further weakness next week, which seasonally has been lower 23 of last 26 years-  Bottom line.. i don't think today turns the trend immediately bearish but theres little wiggle room and can't get under lows from last Friday/Monday without thinking this pullback can extend.. so the risk levels are very much clear and need to be respected.   early gainers in ROX, IDXG, YTRA, MUX, PSDV, ATNM, SRNE, while on downside- KR, ICHR, NVDA, NFLX, AMBA, AU, PANW, CCCR, PACB-  Let me know if you have any questions

Yields down under 2.12 ahead of FOMC

30 min ahead of today's FOMC, we still see stocks paying little to no real attention to the move in Bonds, nor US Dollar.. with yields having broken down under 2.12 while DXY has pulled back to test the key 96 level-   Financials underperforming as might be expected with yields down.. and Energy down another 2% today as Crude breaks down to near make-or-break intraday levels, but will close at lowest level of the year at current levels.  Healthcare and Tech helping market to absorb Financials loss.. and Defensives all outperforming.  If FOMC talks a hawkish game to support their rate hike and pace of hikes going forward, this could help financials bounce and help yields also turn higher which would be key-  At present, little to no real insight as to S&P move but nearly all the focus on the Bond market and Yellen's comments.  GIven that eco data disappointed today badly, the FED might see the need to address some of this soft data, but also talk a hard line to support why they are indeed hiking rates, which from a data standpoint.. looks more like an OPEN WINDOW.. and much more Dow dependent than data dependent, which has dropped off measurably in the last 3 months since the March hike

FOMC day- Homebuilders breaking out to new highs

ahead of FOMC decision alonog with CPI and Retail sales at 830, Futures largely positive globally, S&P extending  gains up a few ticks.. Treasuries firm, WTI and Gold frationally lower-  Trend at this point has extended back to new all-time highs for S&P, DJIA and up 9% for the year- Upside resistance 2443 near last Fri intra-day highs then 2450-2-  Key today will be ability of yields to extend after Yellen's Presser, which would aid Financials in extending gains-  NASDAQ has bounced over the last couple days but is in relatively worse shape given last Friday's decline and importnat to rally back in robust fashion to help avoid a larger pullback-  For now, upside seems limited into expiration but trend higher and do expect further 10-15 points higher for S&P before any real pullback-  Homebuilders have broken back out to new high territory and an area which appears like a good risk/reward at this stage of the rally-Area to buy dips for trading day lies near 2429, 2420 while on upside-  2443 and then 2450- HIGHER:  MBOT, BKD, HRB, ALXN, BTX, DFIN, SOL, while on downside- ALDX, HA, TAX, SQNS and BIIB given CFO departure-  Let me know if you have questions

How quickly can Tech recoup lossses? that will be the key

just past mid-day.  we see market continuing to scale new heights. NASDAQ up a bit more than S&P, DJIA,  breadth about 3/2 positive..  Tech Materials leading.. while energy Financials and discretionary also higher by 0.50%.  only real estate, telecom, Staples lower..  Yield curve has flattened after auction and S&P now about 6 ticks below last Friday highs while DJIA back at new highs .. but S&P WOULD make new all-time high closes at current levels.. and still right to stay long and expect move back above 2443 up to 2450 into Expiration, with the Fed outcome potentially serving as a catalyst-  Rate hike has been nearly completely priced in by market at this point so should prove to be a non-event.. The key will be to watch Tech and how quickly we can see Tech recoup last Friday's losses and NASDAQ for that matter.  at present, it will take a much bigger move to have confidence the worst is behind this sector.. which might be tough given how sharply momentum turned down and turned negative-  overall, right to stay long and favor a test and move above last Friday's highs

CRUDE 4% decline nearing Key support for WTI, & For Energy stocks

Just after mid-day.. US indices have turned fractionally negative in the last couple hours, with most of Europe having closed down-  Volume is light with breadth just mildly bearish, but most of the price volatilty concerns Crude's 4% decline with WTI down to near key support and Energy underperforming dramatically with OIH just above areas to consider buying into end of week- 24.85-25-  Industrials down 0.50%, but seeing Airlines perform very well with XAL breaking out.. so despite GE losses.  there are some interesting areas in industrials that look appealing-  Financials also showing good strength with yields higher, so a very disjointed market with Energy ,industirals losses being offset by Financials, while Utilities 2nd best, rising 0.50%.   Today's best gainers in SIG, AMD, KRC, ICE, GGP, .. 5 REITS making up the top 10.. while NFX, HP, APC, RIG, DVN, MRO, CHK, XEC, MUR and HES-   ALL 10 biggest percentage decliners are Energy-    UNDER 2426 would be a temporary negative..  but after 3 straight down days.. S&P still only 10 points below all-time closing highs from 6/2.. less than HALF of 1%.. or .004%. Little to no volatility ahead of tomorrow which was thought likely.  but volatility likely to pick up-  Key will be Yields and DXY and continued ability of sectors to join strength today in Financials.   

Despite some stalling out, no real market weakness

Not much change in most equities globally ahead of tomorrow, with Comey, ECB and UK election all being important.  Some evidence in both TNX and DXY turning higher.. as Inflation threat recedes potentially in Euroland with crude having sold off.. and should be on the verge of yields turning back higher as they have stabilized of late-  For now in equities.. tough to make much of any selloff.. but just sideways action.. and still could see move up to 2245-50 in S&P.. i suspect today will be a non event with little overall volatilty- but initial areaas of importance near 2435, then 2440 in S&P on upside and 2426, 2421 as support-  Gainers in X, CTIC, DVAX, ARLZ, while on downside- CGG, KMDA, AMBA,GFI, EXAS, HMY, INFY, NAV, PLAY-  Let em know if you have any questions

 

Decline in both TY YIELDS and DXY should be nearly complete

Less than 2 hrs remaining, US indices still showing very little overall net change.. Most of Europe closed down 0.65-0.70% and has been a steady UNDERPERFORMER now for the last month. Gold has extended gains to new 7 mth highs, Crude has attempted to bounce.. and seeing Energy as still the biggest outperformer today, up more than 1%.. while Tech, Materials and Telecom also positive.  However, industrials, Discretionary are both down more than 0.50% and still some weakness out of Financials given bond rally while Staples, Healthcare showing mild losses-  KEY TO MENTION heading into the close and/or into tomorrow-  This bond move should extend another 2 days, so likely that yields break down further into Thursday's ECB along with DXY moving lower  (EURUSD moving higher)  However, as mentioned, a confluence of counter-trend signals suggesting this move is overdone and coincidentally, the counts are lining up right into this Thursday's ECB.. suggesting we could see a big trend reversal in the DXY back higher, TNX back higher and FInancials higher after Thursday..Tough to make too much of this sideways action though in the last couple days,  we had evidence of a stalling out.. yet still not much to suggest real weakness just yet

Minor evidence of stalling, but trend positive until/unless 2400 breached

Market has turned a bit more cautious than what has been seen in the last few weeks, w/ increasing signs of stalling out in Equities with minor losses in US Futures and most of Europe lower.. 10yr yields falling to the lowest levels since November while Gold hitting new 7 month highs- For now, trend stretched and positive but could afford to give back some of last week's gains, and movement down to last week's lows of 2403 SPX would still leave the trend bullish, but help to alleviate some of recent gains..  Big events scheduled for later this week, with ECB on Thursday along with Comey testimony as well as UK election-   US Dollar following suit to yields and both look to be LOWER for the next 1-2 days, though nearing technical targets in price and time and should be readying for a turn back higher based on combination of both oversold conditions and Demark which will be complete by end of week-  Financials could very well underperform the next few days until rates stabilize.. but Defensive sectors like Utes, Staples have gotten stretched and should be on the verge of turning back lower-- Support for today lies near 2429, then 2423,, while on upside- 2438, 2441-2-  Stocks higher early this am:  NIHD, GIII, THO, WGO, PTCT, ACOR, ALR, while on downside- CONN, FRAN, MIK, CASY, MT, HDS-  let me know if you have any questions

 

Defensives continuing to gain ground as market stalls

Into Europe's close. a couple key things to note-  The shift to defensives is starting to accelerate- Utilities following through on their breakout to the highest levels since last July. and Consumer Staples ALSO showing signs of turning higher aggressively and a very similar pattenr, having peaked out last Summer and now just revisiting for the first time-  Stocks like MNST, PM, MKC, SJM making good breakouts and ones to Own and overweight.. while WMT has gone too far too quickly. .. Within the Utes space-  LNT, AEE, PNW, NI, SRE are breaking out and/or on the verge-   SPX still higher by just fractional amounts.. but simply holding in well and no evidence of turning down. and has crept up a bit in the last hour by 2 ticks- as Bond yields have also moved UP and 10yr back at 2.26-   for S&P 2398 will be important.. and over leads to 2404 today-  breadth currently about 2/1.. not stellar..but Financials gaining ground as yields move higher..  and now nearly have caught up with Utes, while materials also gaining ground-   

Utilities moving up to highest levels since last July

Utilities moving up to highest levels since last July

S&P up to near key make-or-break levels

gm-  US Equity futs up marginally while Europe positive and Asia mixed.   S&P Cannot get much higher without thinking a move back to new highs should occur, so Market bears have a very small window in the next couple days.  For now, until/unless SPX gets above 2396 , one can still look to try to fade this minor 3 day bounce.  But momentum has been weaker and weaker of late which is a concern and even on a move back above 2404-6 SP.. the move up to 2425-35 could very well prove brief.   For Tuesday am..  US Treasuries have been firm. and yields down a couple bps at 2.24% and seem to have stalled out.. so this will be key for how equities move most likely.. and to see a continuation to new highs.. we'll also need to see that in yields continuing to press higher. S&P has initial resistance at 2398 in futures with 2388 being a pivot and 2382 being support to buy for trading-   Premkt movers this am:  ETRM, ONDK, A, TOL, VSLR, CVNA, FCAU, WING, BTX, JBLU, and on downside-  KOS, AAP, XLNX, PRGO, MNKD, GLYC-  Let me know if you have any questions

Dollar decline has been more important than Equity volatility of late

As of 2pm.. Equities have largely maintained most of early gains.  However most of Europe turned down into its close. and seeing yields a bit down from earlier highs, but still holding onto fractional gains-  Prices at this point don't have much wiggle room if they're going to turn lower near-term.  S&P above 2396 in SPX cash.. would suggest a move back to new highs.  but the strength of last week's pullback was far stronger than the last 3 days of rally attempt .. and the divergences that grow from any push back to new highs would prove meaningful as indices enter June-  For now.. the DOLLAR decline has proven to be far more powerful than the equity pullback of late, and Yield curve has started to stabilize a bit.. breadth is about 2/1 positive today  and Utilities are leading all sectors with Tech and industrials also making a strong showing-  Energy the only sector down on the day..  so key to note is that S&P and DJIA are nearly at the point where they fill the gap from Wed and can actually rise into early June.. not decline which was originally thought. But both TRAN and IWM remain very weak structurally and most certainly will not follow suit in moving to new highs which will be problematic heading into late Summer/Fall-    For SPX.. we lie merely 4 ticks away from this important area

Breadth and momentum still not recovered from last Wednesday

Fractional gains out of US while most of Asia closed up moderately positive and Europe is largely mixed-   Overall, the negatives of last week's Wed breakdown with regard to breadth and momentum are still a bigger deal than the recovery.. which has arguably NOT gotten up as much as needed to repair the technical damage-   Yields will be key to watch as they largely led the move down in stocks and also the minor recovery effort late last week-  For now, European and US bond yields are higher this am.. while Dollar and WTI, Gold are trading around the Flat line-  2378 important for S&P on the downside, while 2388 and then 2396 import on upside-  For now,  not willing to bet just yet that everything goes straight back to highs and more work needs to be done-  Tech in particular should be watched, along with Financials and signs of yield curve steepening-  let me know if you have questions

 

Industrials, Healthcare moving up towards highs importnat to take note of

2.5 hours remaining..  S&P remains near highs of the day..most of Europe managed to close higher by .60-.70%.  and breadth right now is showing 4.5/1 positive ..  5 sectors right now are showing gains of more than 1%.. with Industrials, and Financials leading.   Financials are definitely key to this mkt moving up. for now the yield bounce is encouraging, but will need to see a bit more to have conviction as S&P prices are right near the prior 2 weeks LOWS.  At current levels we still stand to confirm TD SEQ sells for IWM on weekly basis and small caps have arguably violated trends vs SPX.. while transports haven't acted well-  Both of these groups are hanging in there today..  and other groups like Industrials and Healthcare have rallied with prices within striking distance of important pattern highs.   67 for XLI  and 77 for XLV   .  At current levels for S&P..  its right to take a stab at selling into this for trading between now and end of day with areas near 2390 important for stops..  but prices have gotten very stretched on hourly charts in a short period of time.   The rally IS indeed a positive when looking at various sectors and strength. but the market might still have a tough time racing right back to the highs after just 1 day down given some of the damage that was done which arguably has NOT been all recouped.   While i didn't expect the degree of this rally and thought we could see a retest.  its also tough to get long here intra-day with 2 hrs remaining.  -  We'll wait until end of day closes happen before weighing in too bullish. and for now, its right to trade this move

Bond rally a minor near-term concern for Financials; indices hanging in for now

Into mid-day.. this is a new, and unwelcome development with Financials breaking down a bit as the 10 year yield trend was violated this am, following weaker than expected data , in CPI and Retail sales..  yields had turned UP on weak auctions and BETTER than expected PPI.. but CPI disappointed and bond yields promptly crashed.  Tech fortunately is holding up well.  but without Tech , the market likely would be in trouble , as only Tech and Utes are positive.. while breadth just slightly negative-  But Industrials, energy, Financials, and Real estate leading to the downside.  Technical trends still point HIGHER for S&P to get to 2425-35.. but Financials will need to stabilize and turn up nearly right away.  and this move hopefully will be a short-term affair.  with AAPL closing in on 160 there looks to be minimal upside. in this stock.. so it remains to be seen what can carry stocks higher, if Tech starts to stall in overbought territory while financials turn down.  For now.  Nothing to worry about with the indices..   but good to keep a watchful eye if S&P starts to weaken and 2375-9 the first area of real importance, while over 2393 will need to be rrespected

This week's pullback hasn't caused much technical damage

Fractional weakness out of US futures, while europe remains mildly positive.  Trend still argues for a push higher out of this consolidation, but S&P at this point is within 2 points of closing levels from 4/26.. and last Friday's breakout which was thought to lead to a push back higher, has instead stalled and largely consolidated those gains this entire week.  The pullback however has proven mild as we continue to trade within the range of last Friday's low to high range-  With earnings season coming to a close and turning out the best Earnings in 5 years..with a 70% beat rate.. there seems to be reasons for optimism.. yet we still are faced with far fewer stocks hitting new high territory than preferred with S&P within striking distance of new all-time highs-   For today. use yesterday's lows as important support 2379 down to 2375.. while 2393 importnat on the upside for JUNE FUTURES.   Trend higher in yields should lead Financials to one last push up and is thought to be something that ordinarily can lead Equities-   But a bullish stance still preferred heading into next week until/unless 2375 is breached, looking to press gains above 2393-  Premkt gains in HAIN, CA, P, NVGS, STNG, while on downside-  CAPR, TDW, AKTX, CYBR, JWN, KNSL, DDD, FOGO and GE-  Let me know if you have any questions

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Rebound keeps Trend very much intact

As of 1:30, some backing and filling of the early decline with prices right back up to key areas which were broken earlier.  This is a natural area of resistance after having given way earlier.. 2388.50.. but ordinarily is an area to sell into on the first bounce following a break-    For now, prices held where they needed to on the downside, just above 2375 and have snapped back.. and breadth at this point is only about 3/2 negative, a far cry from earlier 3/1. Still seeing ALL 11 sectors in THE RED.. but have pared losses substantially with Real estate, Discretionary down only .65-.70% while Energy, industrials, healthcare, Staples are just fractionally negative and close to turning positive-  Overall tough to have too negative of a takeaway on today thus far.. the last few hours will decide much.. in terms of if prices back off to earlier lows (which would be a bigger ST negative) or the ability to hold up above 2388 and get back above 2390 or turn positive, which would make earlier weakness a non-event-  Biggest gainers are NVDA, TXT, WFM, BDX, KR, NEM, MYL, AIG, all up more than 1.5%.. while on downside-   M, JWN, SYMC, KSS, HOLG, RL, LB, TRIP all down 4% or greater-   Let me know if you have any questions

Pullback won't change technical structure unless 2375 taken out

Minor backing off in US futures, as the mild pullback this week continues following last Friday's breakout.  In each of the last three days, prices have pulled back and undercut the prior days lows, yet prices remain 10 handles above last Friday's lows, making this seem like just a minor period of weakness and not much damage at all.. despite this weeks persistent slide-   Yields backing off this am giving back of yesterday's post-Auction rise, while Gold and Crude strong again.. recouping the losses of the last week-  Most of  Europe is mixed today while Asia closed up positive. BOE leaving rates unchanged, but GBPUSD slipping after inflation data came in stronger-   Overall, trend will remain positive until/unless 2375 is taken out, about 14 ticks below.  .    Eco data this am has PPI at 8:30 and Jobless Claims..  Advancing issues:   SGMO, SYMX, LPSN, WFM, YNDX, TEVA, YELP, SN, while on downside- SNAP, STRP, MNKD, VSTO, NYRT, SANW, ABR, SP-    Key for S&P Futures will be 2387.50 near yest lows, then 2383, 2374-5.. on upside-   Pivot at 2393, and 2399-2400

Semis leading mkt , up 2% as NVDA powers higher

Into mid-day, most of Europe managed to close up from early losses.. Breadth about 3/2 positive-   Today seeing OPPOSITE activity than what has been seen over the last few days.  Treasury yields are LOWER.. US DOLLAR Is lower.. and both WTI Crude and Gold are higher.  the markets biggest laggard.. IN terms of today's biggest developments.   Semiconductors have broken back out to new highs given NVDA's positive report this am.. (mentioned in this am's Daily Technical Comment) and Hong Kong market hitting new 21-mth highs-  broadly speaking.. Energy is leading all other sectors, higher by 1%.. and Tech, Financials also positive helping indices to hold afloat.. Just minor weakness in Staples, Discretionary, healthcare, and Industrials.  (note- Transportation has been a notable area of weakness of late, and has NOT acted similar to rest of the market, peaking out in mid-February) For now, nothing meaningful in index volatility to draw concern.  Defensives catching a rare bid, but should prove temporary, as yields remain trending higher and today's bond rally should present a chance to sell Treasuries, expecting yields to move HIGHER in the weeks ahead into early June