AAPL Drives Stocks Higher at the Close as Volume Slips

The Bank of England and European Central Bank kicked off the day with holding their rates steady. Neither rate announcement spurred much movement the reaction by the EURO certainly kicked off selling in the US markets sending the US markets to their lows of the session. Selling intensified throughout the morning as the EURUSD dove. Buyers were able to step into the market and were able to push the market back to the mid-point of the session. AAPL at the closed pushed the market back to opening prices as the company announced a review of its cash position. Volume ended lower on the session despite the buying at mid-day and AAPLs late day push. We remain in an uptrend and despite what you may see intra-day we’ll remain disciplined. AAPL has been quite the stock since the lows of 2009. It has been blamed for holding back the NASDAQ from hitting new highs. However, today it single handedly lifted the NASDAQ from its lows. Even in the last 15 minutes of the session it appeared the NASDAQ was ready to head back to the lows of the day when news hit regarding AAPL’s review of its cash. The stock did go ex today with its current dividend and with the news today it wouldn’t surprise me if a combination of a buyback and special dividend will be announced. Sentiment continues to run high amongst the bull camp. AAII bull respondents did slip from 48 to 43 with bears jumping to 29%. II Bulls hit the week at 55% (59% 5 year high) and bears coming in the week at 21% (16% 5 year low). NAAIM investment manager survey saw leverage come off the books to 95% long. Sentiment remains high here, but it can remain high for quite some time. Our uptrend remains in place and we have yet to see any major days of distribution. The same cannot be said for a few European indexes. The DAX, FTSE MIB, and IBEX all are below their 50 day moving averages with big time distribution. Europe may be cracking, but the US appears to be holding steady. Until we get signals of a market correction we’ll remain long. TICKER ST TREND CHANGE DATE CLOSE % SPY UPTREND NO CHANGE 2/7/2013 150.96 -0.13% IWM UPTREND NO CHANGE 2/7/2013 90.16 -0.33% QQQ UPTREND NO CHANGE 2/7/2013 67.30 0.09% USO UPTREND NO CHANGE 2/7/2013 34.68 -1.03% UNG DOWNTREND NO CHANGE 2/7/2013 18.54 -4.24% GLD DOWNTREND NO CHANGE 2/7/2013 161.84 -0.34% SLV DOWNTREND CHANGE 2/7/2013 30.46 -1.14% DBC UPTREND NO CHANGE 2/7/2013 28.44 -0.39% FXY DOWNTREND NO CHANGE 2/7/2013 104.71 -0.13% FXE UPTREND NO CHANGE 2/7/2013 132.92 -0.90% TLT DOWNTREND NO CHANGE 2/7/2013 116.93 -0.22% SLV changed trend today. Yes central banks have their printing presses in hyper drive, but we’ll follow our trend following signals.

NASDAQ Lags as S&P 500 Ends Flat as Volume Slides; European Woes continue

Overnight the Nikkei jumped 3.8% as the country remains hell bent on trashing their currency. Europe resumed moving lower as the DAX fell more than 80 points. On this side of the pond futures were lower on the moves in Europe. Just before lunch time rumors of a special dividend helped send the stock higher dragging the NASDAQ along with it. Just after noon time fortunes for the market reversed and the market headed back to the lows of the session. It appeared as if sellers were going to rule the day. At the close, buyers were able to get the market back to breakeven. Our uptrend remains. Tomorrow we’ll get a rate announcement from the ECB followed by Draghi’s press conference. The EURUSD has been on a tear as of late as the US and Japan intend to print their respective currencies to oblivion. At this point the ECB can only cut rates as it cannot monetize debt. Draghi’s comments has moved the markets before and tomorrow shouldn’t be any different from the past. Which direction shall the market respond is anyone’s guess, but given our current uptrend we are going in long. There is some bright spots out there including DDD and SSYS. Banks continue to act well lead by BAC, GS, JPM, and one of our new longs for tonight. The action in EXPE left a bit to be desired and it appears more and more stocks reacting to earnings aren’t able to hold their breakouts. AMZN is one while having a rich PE has been performing well until the most recent earnings report. Another blemish is the two leading stock indexes we follow remain underperforming the overall market. This can change in a hurry, but we are keeping an eye on our leaders. Tomorrow morning will hold some fireworks and we are looking forward to seeing how our stocks react. Cut those losses short. Short-term trends: TICKER ST TREND CHANGE DATE CLOSE % SPY UPTREND NO CHANGE 2/6/2013 151.16 0.07% IWM UPTREND NO CHANGE 2/6/2013 90.46 0.42% QQQ UPTREND CHANGE 2/6/2013 67.24 -0.33% USO UPTREND NO CHANGE 2/6/2013 35.04 0.03% UNG DOWNTREND NO CHANGE 2/6/2013 19.36 0.94% GLD DOWNTREND NO CHANGE 2/6/2013 162.39 0.27% SLV UPTREND NO CHANGE 2/6/2013 30.81 0.16% DBC UPTREND NO CHANGE 2/6/2013 28.55 -0.14% FXY DOWNTREND NO CHANGE 2/6/2013 104.85 0.07% FXE UPTREND NO CHANGE 2/6/2013 134.13 -0.41% TLT DOWNTREND NO CHANGE 2/6/2013 115.98 0.82% QQQ changed back to an uptrend. This is due to the short-term nature of signals generating more signals.

Stocks End Mixed as Volume Slips

Volume continues to back down from Tuesday’s level and stocks continue to hang in a holding pattern digesting the recent gains. We did get a bit more economic news showing Jobless Claims were less than expected and wholesale inventories fell. It will be nice when claims figures show job creation rather than continued job losses. Most economic news is for cocktail parties and not for trading or at least not for our style. After the Europe close EURUSD took a dive sending our markets to the lows of the session. Buyers were able to step up and support the market pushing prices back to near the highs of the session. Volume dropped more than 10% across the board, a clear sign institutions backed away from the market. We continue to see this market move sideways consolidating its most recent move. There just something not right about this market despite our continued rally. We are not about to argue with the market and fight it. Something just doesn’t feel right out there, but this is precisely the reason we have a cut loss strategy. Just because we may feel one way or another we could be dead wrong! We will not compromise our strategy because our feelings. Opinions are very dangerous and most often they keep you from squeezing every last bit from the market. We’ll stay with cash and a few long positions. Price will dictate our next move in either direction. Sentiment continues to be dominated by those who are neutral. The number of bears did slip to 27.35% according to the AAII sentiment survey. However, only 36.47% of respondents were bullish! How can this be? There are lots of reasons, but when the market appears to want to crack wide open rumors of Fed or ECB action always brings in short covering. It is what it is and fighting the tape is a futile effort. There are lots of reasons to be bearish and very few to be bullish, but when you boil it down all that matters is where price is moving. Tomorrow morning we’ll get a reading from Import prices and the release of the monthly budget statement. Like others, we are looking forward to the weekend. Make sure you get out there and enjoy the weekend.

Merkel Cancels Meeting Sends Stocks off the Lows of the Session

The morning got going with GDP coming in-line with expectations. Putrid growth of 1.9% was in-line with expectations, but far from where we should be 3 years removed from 2009 lows. Shortly after the market opened the Supreme Court upheld Obamacare and the market got interesting. Stocks ended up heading lower after creating a bit of intraday volatility. Nearing the end of the day it appeared sellers were about to unleash on stocks, but Angela Merkel had other ideas. Sending the EURUSD currency pair higher, Merkel canceled her press conference and sent US stocks well off their lows. Hope is still alive the EU summit will produce a solution to European lows. The underlying story of the day was the brutal beating leading stocks took during the day. Big Wave Trading remains in sell mode and today’s craziness confirms our market model. The crazy moves the last two days at the closes on rumor is quite astounding. Yesterday we had the Supreme Court decision shooting down Obamacare. Now, we get Merkel cancelling a press conference and the European Union is saved for another day? Debt on top of more debt is not a solution and at some point hits the point of diminishing returns. Tomorrow, despite the bar being set low will certainly provide some more fireworks. After-hours today RIMM reported terrible earnings as the company continues its downward spiral. It is no surprise the stock continues moving lower. NKE on the other hand was a leading stock and its after-hours action is very troubling. UA another leading stock was hit in sympathy and not to mention has broken down lately. It is never a good sign when leading stocks get hit hard. There are other leading stocks breaking down leading us to be very cautious. We are in sell mode for a reason and until the market can turn around with leading stocks we’ll stay in sell mode. Next week we’ll get holiday trading with the fourth of July landing smack-dab in the middle of the week. Get out and enjoy the weekend!