There are more green arrows around the World as equity markets continue to get upside follow-through following Wednesday’s surprise taper decision. Europe is higher, the Nikkei is closed for a public holiday, while China is modestly higher. There still is some concern over liquidity in China, but as of now it seems to be contained. The IMF head Christine Lagarde gave a bullish economic outlook citing the U.S economic recovery as a catalyst.
S&P futures are up 7-9 handles as we are in Christmas week as our markets re-ignited on Wednesday. The Fed tapered and the Street applauded its new process. Wednesday gave you many opportunities for adjustments at the 50-day EMA (1767) or when we reclaimed the weekly support (1772) or when we took out resistance at (1792) or when we took out all-time highs at 1813ish. There are always times for adjustments.
Today the Nasdaq futures are sharply higher as Apple (AAPL) finally signed the China Mobile deal that has been seven years in the making. AAPL gave us a lot to be thankful for over Thanksgiving as it triggered at $526ish. If it holds the above $565ish in the first hour, the next spot to take out will be the pivot high of $575ish. If we close above that today then $594 is the next resistance.
In today’s Morning call we will continue to check out opportunities for swing trades and tactical cash flow.
The financials continue to act well.
JP Morgan (JPM) had great follow-through to the upside after the nice Red Dog Reversal on Wednesday at $55.66 to get back to highs in just three sessions. A break above $58.14 would mark a new 52-week high.
Bank of America (BAC) is flagging nicely above its 8-day EMA to digest the big reversal move on Wednesday. The longer it stays above $15.55, the higher the probability it could make a new high above $15.98.
Citigroup (C ) has been holding higher after reclaiming its 8-day EMA on Wednesday. A break and close above the short-term resistance at $52.61 from prior pivot high could lead to additional upside momentum.
Goldman Sachs (GS) had a potent breakout at $172.20 on Wednesday and is flagging nicely in its upper range. The bank looks poised to potentially make another leg higher above the two-day resistance of $175.80.
High Beta Tech continues to provide opportunities.
Google (GOOG) enjoyed a three-day rally to make a new high after breaking above the $1100 mark. The stock closed on highs on Friday signaling potential upside follow-through. Holding above the breakout level of $1092 would be constructive for higher prices.
Amazon (AMZN) also made a new high at $404.72 on Friday after reclaiming its 8-day EMA on Wednesday. It also closed above the breakout level of $399 showing some commitment. Use Friday’s high of $404.72 as your new point of reference.
Baidu (BIDU) also had a nice move up on Friday to get back above its 8- and 21-day EMA. It could be Day 1 of a potential move back to highs. Use Friday’s high of $174.89 as the new point of reference to trade against.
Tesla (TSLA) is trying to repair the damage from the two-day sell off last week. The stock closed back above its 21-day EMA on Friday. A break and close above the 8-day EMA at $144.36 could bring in some buyers.
Twitter (TWTR) had a nice gap and go on Friday to knock on the door of a new high. A break above $60.25 could lead to additional upside momentum.
Facebook (FB) has been a great vehicle all year and held the 8-day well, even with the big offering. The longer it stays above $54, the higher the probability we could get another trade above $55.90.
Biotechs showed relative strength last Wednesday and then continued higher.
The Biotech ETF (IBB) reversed well and had nice follow-through Friday. The next pivot to watch is $225. Watch names like Celgene (CELG), Regeneron (REGN), Amgen (AMGN) and Acadia (ACAD).
The 3D printing names had a nice week as well led by 3-D Systems (DDD). Stratasys (SSYS) also performed well. Organovo (ONVO) and Voxeljet (VJET) are more speculative names in the group.
Casinos that were very strong took a breather late last week. See if they get back in play.
Disclosure: Scott Redler is long AAPL, GOOG, TWTR, BAC, GS, C, ONVO, FXI calls. Short SPY.