AAPL Keeps the NASDAQ Afloat as the Market Aways Earnings Season

Coming off a holiday week stocks ended slightly in the red with volume coming in higher across the board. The Dow Jones industrial average along with the NYSE composite both notched distribution days, but the NASDAQ and S&P 500 skirted distribution. AAPL was certainly a star of the session despite volume coming in lower for the stock. Today’s action comes as no surprise to us as many market participants were coming back from vacation. The market clearly is waiting on earnings and first up to bat is Alcoa. We are still in a weak buy signal and we’ll continue to act accordingly until the market tells us otherwise. It is nice not having the troubles in Europe dominate the talk on the air waves. Well, there was some talk, but not the pounding on the table many have been doing nowadays. Attention is now being drawn towards earning season and it will be interesting to see how the market reacts to the many companies reporting on their earnings. NKE and F are two examples of where the global slowdown is clearly hurting them on the top and bottom lines. We’ll sit back and where we need to take action we will and will not be guessing on the direction of stocks will take prior to earnings. We follow trends and certainly do not guess where they may happen next. Alcoa reported better than expected earnings and revenues after the market close. It reaffirmed its guidance for demand, but has yet to express any global growth. The stock was up more than a percent after releasing earnings, but now is hardly above where it closed. AA is not typically a name we’d like to get after since it isn’t a growth stock, but from an economic stand point it is a barometer. The lack of oomph in the after-hours session is quite puzzling and while we aren’t going to act upon it we can certainly ascertain something isn’t quite right. Earnings season has officially begun and let the games begin! A few leaders held their ground while another was unable to hold a key moving average. Both V and MA traded down to their 50 day moving average. Finding support, both stocks were able to hang above their respective 50 day moving average. On the other hand, LNKD was unable to hold its 50 day average. While volume was not above the average volume, it was the most volume seen by the stock since the day the Russell indexes rebalanced. The stock has been climbing on tepid volume and today’s action doesn’t bode well for the stock going forward. Remember to know where you are going to sell out of a position! Cutting your losses is your number one priority. Profits take care of themselves, but losses never do.

Euro Stocks Head Lower, but US Stocks Find Footing Close Near Highs

A lower than expected ADP payroll figure soured the market mood at the early going. Friday’s jobs report is just around the corner and the ADP figure certainly points at a disappointing figure Friday. Volume started out the day running hot, but cooled as the session turned to the afternoon. NASDAQ volume ended lower on the day and is a bit disappointing as higher volume on a day like today would have been super positive. NYSE volume ended higher giving a day of distribution for the S&P 500, but given the support off the lows the distribution day is relatively minor. We are still in a cautious buy mode and continue to look for full confirmation this market can move higher. Earnings season is in full swing and we continue to see wild swings in stocks posting earnings. MA held up well after posting earnings this morning. We continue to see excellent opportunities with earnings season and tomorrow morning is no exception. Reg FD has certainly produced wild moves after earnings, but we have been able to take advantage of the situation. As long as we cut our losses short we’ll continue to produce solid gains. Europe is in big trouble and their stock markets are beginning to crack once again. Spain’s stock market has hit a 52 week low today certainly a negative sign. Germany’s DAX index has put in a right shoulder of a head and shoulders topping pattern. Things are not looking over in the Eurozone and it appears the US Stock Market has largely ignored the perils occurring across the pond. It will be interesting to see how thins unravel here over the next few weeks. If selling pressure continues in Europe will it spread again? The NASDAQ looks pretty good here along with the S&P 500 despite the index sporting two days of distribution. We are under a buy signal, but it would be nice to get a nice strong lift off the 50 day moving average with tons of volume. Until then, we’ll cut our losses short and let our winners run!