The Dow keeps the Streak alive at 8 Days

Another late afternoon lift helps send the Dow into positive territory to end the day’s trading session. Just after 2 pm stocks sat near the lows of the session, but buyers stepped up keeping the market from pushing lower. Volume ended higher on the day, but the early high run rate fell as the market moved higher. At this point volume hasn’t mattered to this market whatsoever. However, it does provide a nice talking point. Not too many standouts on the day, but AAPL resumed its march lower as the stock continues to remain in no man’s land. The S&P 500 and NASDAQ did notch technical distribution days. Despite the distribution the support at the lows we aren’t going to be a lot of weight on the day. We remain in our uptrend and until we see distribution pile up we’ll change our approach. Two leading stocks who had tough days were SLCA and EVER. Both stocks had been moving quite nicely but a secondary offering and downgrade both stocks find themselves under pressure. SLCA issued a secondary offering, but the stock found support. Like SLCA EVER was downgraded and it too found support by the close. This type of action will shake a lot of people out of positions especially without a game plan. If you have defined positions size, entries, and exits you will not be so easily shaken out of positions. Tomorrow’s advance retail sales will be the talk of the financial media tomorrow morning. The question they will try to answer is whether or not the Payroll Tax hike had any effect on consumer spending. I would expect it would not greatly move it one way or another just yet. We can sit here and waste time trying to figure out if the consumer was hurt or not. We are in an uptrend and price is much more important to us rather than guessing. Stay disciplined and always cut those losses short.

Industrials hit more Highs but Volume Drops again

For the 7th straight day the Dow Jones Industrial Average closed higher. Volume fell across the board, but this is normal for this uptrend and Mondays. VIX fell to new lows as buyers continue to show extreme complacency. AAPL reversed off its lows in the afternoon pushing the NASDAQ to new highs on rumors of a “plan” for their cash. The stock is so beaten up any rumor will force shorts to flee for the hills. The Yen and Pound continued their declines as both currencies appear to be racing towards zero. Although it appears the Yen will likely win this race. We aren’t surprised by new highs and we’ll continue to operate on the long side of the market. There weren’t too many negative signs in the market other than the extreme light volume. NYSE volume was extremely low and you have to wonder where the institutions are. Where did they go? KORS a leading stock dropped below its 50 day in high turnover. The stock has continued to struggle after reporting earnings. SLCA issued a secondary after the bell and this leading stock will need to prove it can absorb the excess supply. The Fed’s money printing has seemingly put a floor in the stock market and any downside will be limited. However, we know better and we will continue to work our process. Wednesday is a big day for the markets as we get a reading on February advance retail sales. Many have made a big deal over the pay roll tax increases. WMT stock price has ignored the internal memos regarding sales. TGT has broken into new highs despite consumers having to deal with higher taxes. It will be most interesting to see how the market reacts to the release. Friday’s job report was finally a good sign, but we’ll need to continue to see jobs created a large pace. Unfortunately with the Federal Reserve printing $85 billion a month and continuing ZIRP. At some point either the Fed or the market will stop QE and ZIRP. We need a healthy economy without endless money printing.