Turnaround Day moves to Thursday ahead of the Jobs Report

The US Dollar took a plunge during the session, but the move failed to keep stocks down for long. By early afternoon the stock market found its footing and pushed higher closing at its highs for the session. Volume rose on the NYSE, but fell on the NASDAQ. Institutions were certainly active in the market today ahead of tomorrow’s job report. At one point during the session the S&P 500 was below its 50 day and looked as if it wanted to head further south. The defense of the 50 day moving average is certainly a bullish indicator for this market to bounce. A solid day for market bulls, but given this market’s ability to react violently to news tomorrow will certainly be fun to watch. Volatility broke out during the session as the market fell along with the US dollar. The only thing not to rebound nicely was the dollar index. USDJPY broke through its 50 day moving average and fell below the 96 level for the first time since April. The USDJPY currency pair has correlated well with the Nikkei 225 and tonight’s trading session should be filled with fireworks. Falling into a bear market the Nikkei has come off more than 3,000 points from its high falling below its 50 day moving average. Sure we could see a bounce, but does that mean its going to revert back to its May’s high? Sentiment has shifted in favor of the bear camp, but not at an extreme level. Bulls fell below 30% to 29.47% on the AAII sentiment survey. Bearish respondents couldn’t crack into above 40% closing the week at 38.95%. NAAIM manager survey pushed the median responded to only 55% invested. Interestingly enough if we look at the extremes there was at least one manager who was 200% long when responding to the survey. On the flip side the max exposure on the downside remained at 125%. Sentiment is favoring the bear camp, but given the trading action over the prior week it is no surprise. Tomorrow should be a fun-filled day with lots of action regardless of direction. Try to avoid the talking heads and focus on price. Have a great weekend!

Stocks Resist Selling Finish near the Highs of the Day

A dose of negative economic news helped embolden sellers during the first half of the trading session. However, sellers would lose their momentum and the market would regain strength pushing well off the lows of the day’s gains. After Friday’s late day plunge the market appears to be ready to push higher just in time for Turnaround Tuesday. Volume on the day soared despite Friday’s end of the month volume kicking in. The Dow Jones Industrial average led the broader market showing blue chips are holding up this market. Commodities jumped on dollar weakness with the USDJPY dropping below par. A few leaders were hit today, but with the market finding its footing this uptrend may not be over just yet. Turnaround Tuesday is tomorrow and if we had to wager a guess we’d suspect a rally would occur. Tuesday’s have been very important to this rally and the trend has been for Tuesday’s to finish in the green. Not too mention we remain oversold given where the McClellan Oscillator resides. A run at previous highs is not out of the question with the support at May 23rd low. The market has May’s high in its sights. Gold and silver have seemingly found a bottom along with the miners. GDX has come off its lows as of late after April’s plunge. Volume has picked up on the upside more so than distribution since the end of April. GLD and SLV continue to try to pull off the lows, but volume isn’t prominent like volume on the GDX. Has gold and silver bottomed? No one can answer this question without guessing. Pick your spot and know where your exits are. Stick to your process and have a great week!

A Last Minute Kick Save lifts the Markets off their Lows as USDJPY Pushes above 100

A better than expected jobless claims figure failed to inspire buyers to hold stocks in positive territory at the start of the game. A weak wholesale inventory report sent sellers rushing into the market only to be saved once again by the Fed’s Permanent Open Market Operations (POMO). Big earnings moves by GMCR and TSLA shined as shorts got their clocked cleaned. Both stocks have been in uptrends and have moved quite nicely recently. Some fireworks went off in the late afternoon as the NASDAQ dropped from its high of the day right to its lows. Rumors of an article surfaced, but the move came at a time where the USDJPY surpassed 100. A late day buying surge lifted the market off their lows avoiding a potentially negative close. Volume ended the day mixed with NYSE lower and the NASDAQ higher. A day of distribution was avoided, but given the amount of distribution during April this market can endure quite a bit of distribution. One could call the action on the NASDAQ stalling, but this type of action really hasn’t mattered. Distribution is simply being ignored with the Fed’s POMO going on fresh new cash continues to flood the equity market. It was about time this market finished the day lower. We have seen this market go straight up without much consolidation and today we did get it. It would have been ideal for the market not to head into positive territory only to see the gains evaporate. Given the QE and ZIRP environment is difficult to think or even try to rationalize as “normal.” It is best to stick to a rules based, emotionless trading system. Get in with Big Wave Trading. Perhaps the fed will taper their QE program in the latter half of 2013, but no one really knows. Most are asking what to do when the Fed does end QE, but perhaps another question should be how to invest if QE doesn’t end. Our approach answers both these questions. Join and get educated in driving for gains. Have a great weekend.

Another Late Day surge pushes Stocks higher as Volume disappears

Small caps lead the market higher today rebounding from last week’s losses just ahead of the first quarter earnings season. The market has been finding buyers after 3:30 pm EST and today was no different. Buyers helped push the market to the highs of the session. Volume continues to be extremely light on positive days. A show there isn’t much institutional support, but enough to push the market in positive territory. Our uptrend remains intact despite the lack of volume and we’ll continue to look for higher prices. We did not get any economic releases today and tomorrow will get a read on wholesale inventories. Not exactly exciting and nothing historically has moved the market very much. Wednesday we’ll get the FOMC meeting minutes at 2pm. A few Federal Reserve members have noted curbing asset purchases may help reducing the risks associated with printing to oblivion. It’ll be important to see how the market reacts and closes on Wednesday. Tuesday’s action isn’t likely to have any catalyst to change trend as Wednesday does. However, anything is possible and as long as you have a plan you’ll be in the driver’s seat. The big mover has been the USDJPY and the Nikkei. Central bankers in Japan have jumped the shark and have gone all-in on purchasing Japanese debt. For three straight quarters Japan has seen negative GDP growth and prospects remaining bleak. Again, the world is expecting a central banking cartel to manage using decentralized data. Bond purchases have not worked in decades and it is likely this round of unlimited purchases will have very little long term success. Will we get another Zimbabwe? Time will tell. Stick to your game plan and remain disciplined.