Stocks Pull back as Volume Rises on the NASDAQ

European markets were dealt with poor flash PMI data with France flashing a very weak PMI figure. Futures were set to open lower ahead of the 830 data release. Despite a better than expected Jobless claims figure and inline housing price index futures simply couldn’t muster the buying power. Sellers took hold of the market just after the release of the better than expected Philly Fed survey pushing the market to the lows of the session. Like a broken record as the Feds POMO began the market found its footing and rallied until the close of POMO. It is quite uncanny how POMO keeps this market afloat. Sellers had one more shot to send the market lower and did so just before 2pm rolled around. However, the support at the 2pm lows wasn’t able to keep the market from closing above the mid point of the day. The NASDAQ did notch a distribution day bumping its count up to 4 days. We remain in an uptrend, but the caution flag has been raised. Cyprus continues to be a thorn in the side of the market here. It may just be an excuse for pundits to use as this rally has gotten long in the tooth. However, we are seeing disappointing earnings from the likes of FDX and ORCL suggesting the economy may not be what people think. Both these stocks were acting well up until their most recent earnings report. Coupled with distribution piling up is something we are keeping an eye on. Mind you, we aren’t trying to anticipate a turn, but preparing to take the signals in whatever direction. Sentiment remains tilted towards the bulls, but we aren’t at extreme levels we saw back in February. AAII bulls came in at 39% and bears at 33%. AAII is a volatile survey and a stiff breeze will shift sentiment. II survey saw bears drop to 18.6% from 18.8% and Bulls drop to 47%. Again, bulls aren’t at extreme levels while bears are nearing an extreme. Sentiment is by far a perfect science, but an interesting talking point. Sentiment like overbought/sold conditions can remain for long periods of time. The market does feel like it is heavy and will correct here. Unfortunately for those who try to predict these moves were wrong last month when the market looked like it was about to correct. Anything is possible and sticking with trend following will reap the greatest returns over the long term. Have a great weekend and best of luck on your March Madness bracket!

Bernanke Presses on with QE, but Volume Drops as Stocks Close Higher

Another Federal Reserve meeting and the central bank vows to continue to print billions of dollars a month until the Unemployment rate drops to acceptable rates. Cyprus fears seem to die down as it appears Russia will protect its own and give a bailout to the small island nation. Banks will not reopen to next Tuesday, but the situation begs the question will the next EU country who needs a bailout and is not involved with Russian Oligarchs will be required to confiscate bank deposits? Philosophical question, but we digress. Price action continues to indicate this uptrend will continue higher. Volume was lower on the day despite the Fed’s Chief promise to keep the printing presses pumping liquidity. How high and how far we’ll go is anyone’s guess, but we’ll continue to operate in an uptrend. Two blemishes on the day were HPQ and FDX. These two stocks have been leading this market higher, but both today turned lower. HPQ appears to have run out of steam after doubling since its November lows. FDX earnings release disappointed the market. Falling more than 7 points on the highest volume since 2010 it blew through its 50 day moving average. FDX had been leading the Transports to new heights, but after today it places a blemish on the current uptrend. Perhaps a bigger earnings story is what happened to ORCL in after-hours trading. When all was said in down in the after-hours session the stock fell more than 7% from today’s close. The stock missed its earnings expectations and was punished. ORCL has been pushing higher and leading the NASDAQ higher along with GOOG. We’ll see how the stock reacts in tomorrow’s session, but the drop in after-hours is quite telling. Now with the Federal Reserve out of the way it will be interesting to see if the market can continue to remain elevated. Time will tell and price will guide our trading.

Volume slides NASDAQ erases losses

The market avoided a day of distribution despite early morning losses. A negative housing report soured the morning mood as sellers dominated the morning trade. Buying kicked in just afternoon time as upside volume begin to emerge. The end of day action wasn’t ideal as a slight pull back from the day’s highs was a bit disappointing. However, the support at the lows is something unmistakable as this uptrend continues to prove to be unstoppable.

At some point, yes this uptrend will cease and we’ll get a correction. No one can predict when we’ll get a correction. Distribution count on the S&P 500 is 4 and the NASDAQ sits at just 2. While the S&P 500 distribution count nears an area of concern the NASDAQ remains in the clear. Of course further selling on volume would change this, but we’ll wait and see.

AAPL was a big part of the market’s rise from the bottom. Early morning sellers were eager to take down the stock after it closed above $600 for the first time. Closing near the session highs on above average volume was a clear sign institutions stepped in and supported the stock. One thing to note, the stock closed again at another all-time high. Tough to be bearish on the stock right now, unless of course you like to pick tops and in this case you have been wrong quite often.

Another big winner on the day and for BWT members was KORS. KORS had a bit of trouble during mid-day, but buyers jumped in and pushed the stock higher closing just below its high of the day. The company raised its guidance and the market rewarded accordingly. KORS a recent IPO, continues to show strength and is a staple of the BWT portfolio.

In earnings news, ORCL posted better than expected earnings. The stock rose 1.5% at the close of the after-hours session. The stock was up more than 3% during the after-hours session, but was unable to hold onto its gains.

This uptrend remains tricky and will continue to frustrate investors. Stick to a disciplined approach and BWT. Cut those losses short.

Stocks Slide in Last Hour of Trade, but End Higher on Volume

Current uptrend logs another day of accumulation

Late day selling dampened the mood, but an overall positive day in the markets. Volume jumped across the board as the market mostly cheered about positive earnings reports and tepid inflation readings. Import prices were relatively in-line with expectations despite the overwhelming talk about the Federal Reserve second round of monetary easing. The late day selling is not surprising considering the move in the markets, but the action from stocks post earnings reports leaves a sour taste in the mouth. Even with the weak close the market is still in a solid uptrend.

The weak close suggests we may see a pull back tomorrow. The chances are good we see the market take a breathier. Consolidation is a necessary process for the market to undergo as we simply cannot go straight up. These periods can last a few hours in rare cases to a few days. As long as we do not see market leaders collapse and distribution the resting period is quite normal action. Pay attention to your stocks, if they begin to weaken take notice and make sure you are taking profits.

The earnings curse once again hits this quarter with JPM, IGTE, and ADTN reversing after seemingly good earnings reports. JPM stock is far from one we would like to be long, but the action in IGTE and ADTN both leaders are slightly troubling. Both were able to find support at their 50dma, but their charts are now damaged. It will take some time to repair the damage done today, but it isn’t something we would want to stick around to wait for. We’ll need to see the stock tighten up and form another base before we would get long.

Another big deal of the day was AAPL stock hitting the $300 market. The stock was able to hang onto the mark as the company said it would release a new operating system. AAPL stock has been a stalwart of this market rally and has yet to suffer any major setbacks. If this market is to go higher, we’ll need to continue to see strength in the market.

In a surprising move a deal for YHOO stock surfaced after-hours pushing the stock higher by 13%. The move will certainly help the NASDAQ tomorrow, but the question will be if the rest of the market will respond positively to the bid for a beat up technology stock. On the other hand you have ORCL posting a strong day without a takeout rumor. Ideally, you want to own a stock that is strong and not guess whether or not the stock may be taken out.

Be mindful of your losses, always cut them short.

Top Current Holdings With Total Returns That Closed Higher Today: JKS 140% JOBS 65% LGL 64% RES 57% MIPS 47% SOL 41% ISLN 31%, IVN 30%, NSU 24%, CGNX 21%, XXIA 21%, GBG 20%