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thursday morning
at 2007-02-06 15:26:24
SHORT TERM: stocks gap up on the open continuing the rally.
Overnight the Asian markets were mostly higher and Europe came in over 1% higher as well. As a result our stock index futures traded higher. At 8:30 the Commerce dept. reported Dec. CORE PCE inflation rose only 0.1%, and 2.2% for 2006. Another tame inflation report sent the stock index futures rising, and at the open stocks gapped higher, as the SPX/DOW/NYA/R2K all made new bull market highs. At 10:00 the Institute for Supply mgmt. reported JAN. ISM slipped below 50% to 49.3%, which indicates a contraction in manufacturing. This is the third time in four months that the reading has been below 50%. The manufacturing sector remains soft. Stocks took this news as an opportunity to pullback some. Bonds are trading a few ticks higher, Crude 20 cents lower, Gold continues its uptrend up $5.50, and the Euro is flat. Short term stocks are a bit overbought here after this weeks rally, and a small pullback should b
thursday update at 2007-02-06 15:26:24SHORT TERM: cyclicals continue to rally while techs lag.
Stocks gapped up at the open today on the continuing positive inflationary news: Core PCE up just 0.1% in Dec, and 2.2% in 2006. The rally continued until about 10:00, then the techs turned over and started to pullback. By 11:30, the market bottomed and started higher again. Throughout the rest of the day, the cyclical SPX/DOW/NYA/TRAN/R2K rallied, making additional new highs, while the techs lagged. Bonds were flat, Crude dropped 80 cents after rallying earlier, Gold rallied $5.50 and the Euro was flat. Notice how Gold is not paying much mind to the Euro or Crude. The TRANsports continued their strong rally, and are now less than 0.50% away from all time new highs. This index would again join the DOW/NYA/R2K, which are already in all time new high territory. The SPX reached 1447 today, less than 1% away from our next targeted long term EW pivot point at 1462. At the close: the SPX/DOW rose about 0.50%,
friday morning at 2007-02-06 15:26:24SHORT TERM: market opens higher on weaker job report.
Overnight the Asian markets were mostly higher, except for China's SSEC which tumbled 4%. Looks like China is finally correcting after a torrid advance where this market gained 94%. Europe came in about 0.50% higher, and our stock index futures were relatively quiet before the open. At 8:30 the Labor dept. reported Jan. non-farm payrolls rose less than expected, and the unemployment rate rose to 4.6%. The stock index futures rallied on the news and the market opened higher. At the open the SPX/DOW/R2K made new bull market highs, and, the TRAN posted an all time new high for the first time since May06. After a few minutes the market pulled back some to make a short term low at 10:00, and then rallied higher for the day. Bonds are up a 1/4 point, we have possibly seen the medium term low, and Crude is up 15 cents, as yesterday should have been the end to Crude's short term rally. Gold is off $10.00, a short ter
friday update at 2007-02-06 15:26:24SHORT TERM: market remains modestly higher throughout the day, but closed mixed.
This morning stocks opened higher, took some selling until 10:00, bounced around a bit, then made higher highs for the day around 2:00. The SPX/DOW/TRAN/R2K all made new bull market highs, and the techs held steady closing higher. Bonds gained a few ticks, cRUDE touched yesterday's lows and then rallied late in the day to another short term high, (up $1.80), when additional sellers failed to appear at the lows. Gold remained lower all day down $10 and the Euro remained lower as well. At the close: the SPX/DOW were mixed despite the SPX hitting 1449, and the NDX/NAZ were 0.33% higher. Short term the hourly charts continue to display negative RSI divergences in the SPX/DOW, but the NDX/NAZ readings remain neutral: mixed signals on a mixed day. Overall the market continues to look good. Enjoy your weekend!
MEDIUM TERM: bullish
LONG TERM: bullish.
weekend update
at 2007-02-06 15:26:24
REVIEW:
Lots of economic data this past week, which was all relatively positive for the economy. The FOMC meeting produced the most economically accommodating statement since Bernanke took office a year ago. The SPX hit 1449 for the first time since Sept. 2000, and the DOW/TRAN/NYA/R2K all hit all time new highs. Small caps, large caps, and the cyclicals are leading this bull market. For the week, the TRANsports led with a 6.2% gain, the SPX/NYA were up 1.8%, the NAZ/R2K +1.7%, the NDX +1.4% and the DOW was up 1.3%. Was a good week for stocks as the bull market continues.
LONG TERM: bullish since Oct 2002.
While the DOW continues to make all time new highs, and the SPX continues to move closer to its all time high at 1553, this market has finally received the recognition of being what it has been all along: a bull market. As one of our OEW group pointed out, SPX 1383 seemed to be the pivot point of no return for the bears. The mark
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