World markets are mixed this morning as Europe pulls off a bit from five-year highs and Asia remains somewhat sloppy. Most market participants are trying to figure out how committed they need to be at these lofty levels and if the “melt up” could continue.
S&P futures are down 4-5 handles this morning as we continue to hold this upper range. The longer we stay above 1752-1754 the higher the probability the
grind/chase could continue above 1775. If this doesn’t hold, then the next spot to look at is 1729-1735.
Yesterday we got a lot of the same. Very selective individual action with lots of “things to do” if you are looking for them.
In today’s Morning Call we will look at the consistent opportunities in High Beta Tech.
Tesla (TSLA) led the market up yesterday as the stock showed relative strength right off the open. Buyers continued to lift the stock up throughout the session as it closed on highs and logged a 7.6% gain. It could see some upside follow-through above yesterday’s high of $175.39 with earnings due out after the close.
Apple (AAPL) showed some relative strength yesterday after holding above the current support floor of $515-518. A move through $527.50 could lead to additional momentum and it has room for a move to retest the current high of $539.25. A break above that could lead to a move up to the $550 area. First we have to see if it can go negative to positive this morning.
Netflix (NFLX) had a nice Red Dog reversal at $311 on 10/29 and now is trying to break and extend above resistance at $337ish. I’d continue to take trades and have no opinions here.
Amazon (AMZN) gave a nice trade from the short side right off the open yesterday as the stock filled the gap to the down side and went as low as $354.40 to retest its 8-day EMA. It’s currently holding above this key moving average. Use yesterday’s low of $354.40 as the new pivot to trade around. Still very choppy but that can change quickly.
Google (GOOG) is still hanging around above the 8-day with limited choppy action for now. It needs to get and stay above $1032 for momentum guys to pay attention for a potential new high move above $1040ish.
Facebook (FB) has been very volatile since earnings and looks a bit vulnerable. It did show some relative weakness yesterday. Yesterday’s low for action is $48.02 and then important support from earnings day at $46.50.
LinkedIn (LNKD) got hit on earnings and tried to stabilize a bit yesterday with a Red Dog Reversal at $219. Look to this for a potential negative to positive move and perhaps a bit more follow through above $225-227.
Reports are that JP Morgan (JPM) is close to some type of settlement, which I think could help the banks. If we can get the news out of the way, I think the group is worth a look after having been out of play for a bit.
Goldman Sachs (GS) has been finding support along its 8-day EMA. The bank has a tight mid-level range that, if breached, could lead to upside resolution above $163.35.
Morgan Stanley (MS) also broke and closed above its 8-day EMA with a 0.45% gain yesterday. It’s trying to break above the recent descending channel and a break above Friday’s high of $29.55 could add more fuel to this move.
Bank of America (BAC) gained 0.21% yesterday as the bank is trying to hold above last week’s pivot low of $13.96. A break and close above the 8- and 21-day EMA at $14.11 could get this some attention.
State Street (STT) had a nice move back to highs after the breakout on October 29th when it cleared the down trend resistance that had been in place since July. It has some resistance at $71.26 from the prior pivot high. Holding above the recent pivot low of $70 could help it clear this resistance.
Stocks that closed strong yesterday:
The 3-D printing group continues to provide a lot of opportunity. 3-D Systems (DDD) closed at all-time highs, lifting the group once again. Stratasys (SSYS) needs to hold $112 to remain in great shape. ExOne (XONE) woke up yesterday and perhaps you could get a red to green trade through $55.25. VoxelJet (VJET) is a new issue that also broke out of a wedge pattern. It needs to hold $34.50ish and could see more momentum above $35.88.
JC Penney (JCP) gave us a nice move from $7.20ish all the way up to $8.50+ – a nice trash for treasures trade. Now it needs to hold $7.85ish to stay interesting. I closed it out yesterday.
The 2x Inverse Bond ETF (TBT) did hang around yesterday after Friday’s strength. As long as it stays above $73.50 it can see additional gains above $74.60ish.
Metals continue to frustrate anyone trying to be long, but they’ve been that way for most of 2013. The downtrends have been very strong and visual to technicians. The gold bulls just had a chance but GLD failed on October 30th at the $130 level.
We have two more days until the Twitter IPO. The range was lifted to $23-25 (one strike against them). Let’s hope they don’t raise it again and add shares last minute. LNKD & FB started very differently, but both provided opportunity for investors months after the deal. LNKD was cleaner, tighter and caused less pain for the public in the immediate wake of its offering. TWTR doesn’t have to be Facebook. Let’s hope they don’t get more strikes against them in the next day or so.
Disclosure: Scott Redler is long AAPL, BAC, POT, NUAN calls, AAPL calls. Short SPY, long SPY put spread.