The Friday Stock Market: Addicted to Love With Shades of Gray
The final fifth of our freaky week is upon us.
Editor's Note: Todd posts his vibes in real time each day on our Buzz & Banter.
Freaky Friday has arrived and there's no shortage of items on our radar.
Google (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT), and IBM (NYSE:IBM) reported last night, with Big Blue sticking out as a sore thumb.
General Electric (NYSE:GE) released funky earnings this morning and Mr. Immelt says the company is "well-positioned for stronger performance."
And of course, April index options expire this morning, with individual stock options expiring on the close.
As discussed yesterday, expiration influences tend to manifest in the days prior to the actual expiry, and that has played through in spades.
Monday, the S&P (INDEXSP:.INX) lost 36 points. On Turnaround Tuesday, they bounced 22 points. Wednesday, they lost -- yep -- 22 points, to close precisely at Monday's close. Yesterday, they knocked 'em another 10 handles -- but the bulls held the all-important S&P 1540 level -- and naturally, this morning the S&P futures are indicated up…10 handles.
Are we having fun yet?
I've been actively trading these last few weeks -- shorting to cover vs. buying to sell -- and I deviated from my hit-it-to-quit-it stylistic approach last night, carrying 50% short exposure into this morning. It stands to reason that the early morning futures are indicated higher as the trading gods have a vicious sense of humor.
Gap & Go or Pop & Drop? Too early to tell, but I will note the confluence of resistance between S&P 1560 and S&P 1610, with the former zone arriving through two lenses: a back-test of the uptrend in place since November and the short-term downtrend line, as evidenced in the charts below.
Lots to digest as I jump the fence to the Buzz & Banter -- this is where I, and others much smarter than I am, share our vibes in real-time; click here for a free trial. But first, some Random Thoughts:
Perspective check: The S&P closed yesterday 3.5% below an all-time high. You wouldn't be able to tell that from all the hand-wringing, and perhaps that's telling.
I don't believe there is such a thing as a quadruple bottom; keep that in mind when S&P 1540 comes back into play.
One Boston terror suspect is dead and the other is on the lam as large swatches of the city have been shut down. Love and white light to our brethren there; know that our thoughts and prayers are with you.
I like to wait 30 minutes after the opening -- to let the noise settle -- before taking the pulse of the tape. Of course, this doesn't preclude opportunities to "fade" the opening, either way, when that opportunity presents itself.
The German DAX is down 1.5% for 2013 vs. an 11% gain in the Dow Jones Industrial Average (INDEXDJX:.DJI), an 8% gain in the S&P 500 and a 5% gain in the Nasdaq (INDEXNASDAQ:.IXIC).
Watch Goldman (NYSE:GS) too, as the insider sales window should open up any day now (if it hasn't already).
It's great to see the Yankees and Red Sox stand united in life; perspective indeed.
Apple (NASDAQ:AAPL) has burned a lot of dip buyers; my level remains +/-$360 but it remains to be seen if I'll see that as earnings arrive on Tuesday.
- I'm long humility and short hubris, for if we don't stay humble, the market will do it for us.
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Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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