Futures were pointing to a stronger open as Election Day dawned on the city of San Francisco where we greet you from tonight, the home of the 2010 Major League Baseball World Champions. As voters headed to the polls markets were looking forward to the election uncertainty being behind us and, of course, the FOMC QE2 announcement on Wednesday.
Today’s session was all in the gap; the close was right where the market was two minutes into the day. But today’s session ended the streak of six consecutive close within a two point range. We closed above the 200wk ma, and thats huge. I believe we could be headed for a rally into end of year like 1999, if the Fed doesn't disappoint.
Looking at the Market Leaders board for this evening we see that the leaders are up across the board. Only two of the leaders are more than 4% off their 52 week highs: The Financials (XLF) and Russell Technology. As the market moves into a seasonally strong time period most of the leaders appear ready to march higher.
For the SPX Index there were 406 Advancers/82 Decliners. On the NYSE 3,127 issues were traded with 2,237 advancing issues and 801 retreating issues, a ratio of 2.79 to one advancing. There were 248 new highs and 15 new lows. The five day moving average of New Highs is 184 while the five day moving average of New Lows is 14 and the ten day moving average of Net Advancing is 380. The Net Advancing data indicates a bullish trend.
Advancing volume was higher at a ratio of 2.7 to one. The closing TRIN was 1.03 and the final tick was 881. The NYSE Composite Index gained 0.97% today while the SPX gained 0.77%.
For the NYSE, relative to the previous 30 session average, volume was -11.38% below the average. Of the last 15 sessions 7 sessions ended with volume greater than the previous rolling 30 day average volume. Of the last 30 sessions, 22 sessions ended on a positive tick, 7 of last 10. For the SPX, the day's volume was 84.1% of the average daily volume for the last year. Volume was 84.7% of the last 10 day average and 101.3% of the previous day’s volume.
Once again, data has turned back upward. Breadth was strong although the advancing volume ratio isn’t convincing. But the broad NYSE Composite Index outperformed the SPX and the final tick was strong.
Total tick for the day was 180,000 and the average tick for the day was 117. There were 71 ticks greater than 600 and 27 ticks more extreme than -600. There were no ticks greater than 1000 and 1 ticks more extreme than -1000.
The bears simply can’t get anything going. The tick data today wasn’t really powerful; but with an eight point gap upward, the bulls simply needed to hold their own today.
Troubling for the bears today also is the intraday volume pattern; we see volume increasing on the SPX up moves. The nightly breadth indicators have also turned upward, as would be expected on a day when the SPX gained almost 1%.
Sold 50% of my shorts yesterday, selling the rest this am. 40% cash. Waiting to see what the Fed does. I expect a trillion dollar package, I expect the DXY to break below 76 support and test 74. I expect Silver, Gold (miners have lagged price), Ag, XLE, other materials to out perform. Just as a side note I saw interview with Honeywell CEO he says that Aviation (Planes) cycle is just starting. (PCP) is my favorite name here. Look for part makers, seats, and widget plays in the near future, (Alloy) ATI, and TIE come to mind as well (watchlist).
Have a great day!
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