There are green Arrows around the world as most follow yesterday’s strong bounce back in the US markets. Europe is now at five and half year highs after its controlled pullback to start the year. The Nikkei bounces back well up 2.6% and the Shanghai tries to hold in.
Yesterday most participants (including me) didn’t know what to expect, but the bulls took back control. We talked about “what type of bounce” will we see after Monday’s downside action. Well, it was potent enough to at least get back some back to neutral, vs. short on the brain.
Some of those really flexible, actually put some longs back on as there was a lot of healthy action. There were two key spots to make some adjustments, at SPX 1824 or 1832. If the bears had control, they wouldn’t have let the bulls reclaim these zones.
Today S&P futures are up 2-3 handles with support at 1832 and 1824ish. Resistance stands at 1840 then all-time highs at 1849.
Lots of action in High Beta Tech.
Tesla (TSLA) was a nice surprise yesterday as the stock jumped 22% intraday after the deliveries of its Model S in the fourth quarter topped the company’s forecast. There were multiple entries including a nice RDR at $137.82. Then the stock cleared most of intermediate resistance to close on highs. Holding above the prior pivot high of $158 could keep its momentum intact for some more short squeeze.
Apple (AAPL) enjoyed a two-day rally after the Red Dog Reversal at $531.11 on Monday. The stock has reclaimed the support of its 21-day and sitting in front of its 8-day EMA. Tim Cook made some bullish statements about China Mobile deal and it’s gapping up. See if this gap up holds which would really get this going again. Next resistance $554 then $561.
Google (GOOG) continued to be the rock star of the market. The stock made a new high at $1151 yesterday after finding good support at the 8-day EMA. Any dip has been buyable in this market leader. Some consolidation above $1128 would be healthy now.
Netflix (NFLX) started to perk up a bit as the stock made a higher low yesterday. A break and close above the 8-day EMA at $343.45 could bring in some more buyers for a potential gap fill. The gap resistance to watch is $347.89.
Facebook (FB) continued to build a base above its 21-day EMA, showing healthy strength. The longer it consolidates above $557.50, the higher the probability it could get some upside momentum for a new high above $59.
Twitter (TWTR) is struggling a bit, you have support at $55.59ish and it needs to clear $60.50 to get out of harms way.
Banks didn’t have much action but did hold in okay.
Wells Fargo (WFC) and JP Morgan (JPM) were pretty solid. As long as they hold above yesterday’s lows, I feel patterns will build for more upside.
Bank of America (BAC) came out with a solid report and it’s above $17 this morning. The stock has been a great vehicle. You can trim and trail, but I think this could see north of $20.
Citigroup (C) and Goldman Sachs (GS) report tomorrow.
The Agricultural group that took 2013 off is acting better this year.
The Agribusiness ETF (MOO) has a nice channel and if you want some exposure I’d look there for opportunities. Above $54.50 and it could clear a nice channel. Some names moving well are CF, MOS, POT and AGU
Some groups are priced for perfection and do need to be watched close as they can change composure a bit. For example, the 3-D printing group lost the 8-day moving average yesterday and then got more negative news after the close after XONE warned on its revenue outlook.
Stratsys (SSYS) had a gap and go to drop 8.18% after the company gave a mixed outlook for 2014. The damage was contained at $113, which lines up with the prior break out level. If it doesn’t hold this pivot, next level to watch is $108.
3-D Systems (DDD) also had a wide trading range yesterday. The stock managed to pare some losses into the close, but met some sellers again after hours. The chart is a bit broken and needs time to repair. Use yesterday’s low of $84 as the pivot level to watch.
ExOne (XONE) slipped 5.37% to break below its 21-day EMA yesterday. The stock continued to drop another 13% after hours after the company cut its 2013 revenue outlook. Next major support comes in at $51-51.40 where the 200-day lines up with the prior support. See how it handles this level.
Voxeljet (VJET) also got hit with 9% loss yesterday. The stock has been struggling after the big sell off on 11/20. It had a false breakout Monday flashing a warning signal. It is down big this morning with the rest of the group. There is some support at $37 and beelow that $34.10 is the next pivot level to watch.
Some other names in play
VMware (VMW) broke out to new highs for 2013 and looks like it could be on its way to $100+.
Salesforce (CRM) also acted well yesterday. Above $57.68 it could see higher highs.
Microsoft (MSFT) had a big engulfing day yesterday, now it needs to hold above $35.50 to stay interesting. A trade above $36.15 would get it to clear the lower pivot.
Intel (INTC) had an impressive move yesterday, lots of optimism surrounding this name heading into earnings. The Semiconductors ETF (SMH) is also leading the way.
Ctrip.com (CTRP) has been beat up but is trying to hold lower support. Above $41.30 and perhaps it could retrace higher.
eBay (EBAY) is acting a bit better. It needs to clear $53ish to start heading back to the upper end of its channel.
DangDang (DANG) seems to be getting some volume recently. It looks like it could be on its way back to $12+.
Metals came off a little yesterday as the market bounced. GLD needs to hold $119.30ish otherwise that bounce might have been it.
You need to measure the market everyday if you trade for P&L. Yesterday most had some choices today, and now the longer we hold above SPX 1832ish the higher the probability that there could be more choices needed to be made at SPX 1849ish.
Disclosure: Scott Redler is long AAPL FB BAC CTRP POT MEET UNIS DANG- short SPY