Earnings continue to control price action
Tuesday brought us another day of split markets and higher volume. The NYSE and Nasdaq both booked better volume today leaving an accumulation day on the NYSE and a distribution on the Nasdaq.
Crude finally stopped the bleeding and closed with an up day at $59.35 +.54. Gold also up today to close at $587.60 +4.70. With inventories for crude on tap for Wednesday and interest rates, we should see action in both of these markets.
The Fed will complete the meeting and let us know what they have to say at 2:15 on Wednesday. The overnight lending rate is expected to remain at 5.25%, but the statement will be carefully reviewed by everyone. The market would like to here conclusively that rate increases are behind us and look forward to the first cut. That maybe asking a little too much is my guess and I doubt we see any more clarity on that front than we did from the last meeting.
Wednesday some focus will be on the 10 and 10:30 data, but the day will await the Fed at 2:15. Earnings will keep things moving, but expect a narrow range and light volume until 2:15. The reaction to the fed’s statement has been very slow lately so also watch for that. I am not going to predict or I should say try to predict direction off the announcement, no rate change is priced in the market. So unless they do a change the rate the market will remain dependent on the statement for movement. Those of you that trade with me know we’ll trade the reaction and any counter move. So stay tuned for 2:15!
Tuesday was nothing short of just DULL, quiet narrow range day. The volume being higher did show some participation, could be profit taking as we sit at these highs and it could be positioning ahead of the Fed. Regardless of what it was, the range was narrow and left us no where. After hours tone was somewhat upbeat. KLAC and AMZN both trading up nicely and ADI the only real glitch in the bigger names which was down. Given that TXN yesterday was beaten up ADI doesn’t surprise me. KLAC however will be nice breath of fresh air for the semi’s and give a boost early tomorrow.
Economic data for the Week of October23rd — October 27th: Wednesday 10:00 Existing Home Sales, 10:30 Crude Inventories, 14:15 FOMC Policy statement due out, Thursday 08:30 Durable Orders, 08:30 Initial Claims, 10:00 Help Wanted Index, 10:00 New Home Sales, Friday 08:30 GDP-Adv, 08:30 Chain Deflator Adv., 09:50 Mich Sentiment Rev.
Some earnings due out this week (remember you should verify any data, it can change quickly): Wednesday pre market — MO, BIIB, BA, CRA, CL, GM, HET, IMCL, PFCB, TASR, WMI, WLP, WY, during market hours BUD and after the bell — AEIS, AFFX, BOBJ, CRUS, ERES, LSI, MTH, MCHP, PHM, SFNT, USPI, VAR, WMGI, ZMH. Thursday pre market — EYE, AET, BMY, CELG, CRDN, COP, CNX, XOM, LLL, LIZ, MEDI, MSTR, MLNM, PENN, QLTI, SEPR, S, HOT, LCC, XMSR, during market hours THI, WEN and after the bell — CNXT, ELX, GOL, ISRG, IRBT, LSCC, MSFT, ONNN, PLAY, SOHU, SUNW, UHS, VSEA, WEBX, WEBM, YRCW. Friday pre market BHI, CAH, COCO, CVH, OS, SPSX and after the bell — LPNT.
ES (S&P 500 e-mini) Tuesdays late day action showed the bulls had a little stamina, just enough to take out Monday’s high to knock out an inside day. Still was not impressive or exciting action on the day. Wednesday’s pivot is 1382.75, which is convergent to 38.2% fib off Tuesday’s range. Will just be a perfect pullback and place to dance around in anticipation of the FOMC announcement. Support: 1382.75, 1378.75, 1376.50, 1373, 1371.50. Resistance: 1386.25, 1388.50, 1389.5 and 1392.50.
NDX (Nasdaq 100) closed —12.05 at 1713.88 with an inside day. Support: 1701.61, 1693.19, 1682.55. Resistance: 1717.50, 1727.61, 1733.73, 1741.35, 1750.21.
Here is to a day of volatility and positioning for the rest of the week!
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