DOW 13,000 and SPX 1370 proved to be tough obstacles last week. We tested them a few times but failed to close above.
Market volume has been light but we still see constructive action. Nice rotation and sporadic break outs.
Oil and other commodities were strong last week and broke higher, with some select leaders.
Today, we come in and the Futures are down 6-7 handles. News out of the G-20 disappointed some as they rebuffed.
Calls from the Euro area to boost international lending resources. I did see a small divergence in the housing sector and semi’s towards the end of last week but, each day different groups diverge and then don’t fall apart. We need to see if that continues. The 10day moving average still supports this market and it needs to be watched closely for short term composure and speed.
SPX- Down 6-8 handles.
The 10day moving average stands at 1354- Keep an eye on how the market handles this in the first 30/60 minutes of trade. More importantly will be how we close.
Big support right now stands at 1342-1344- The 20day moving average now stands at 1344- We have not even tested this average since the December 20th Gap and Go
Apple (AAPL) remains impressive. Stock has had a huge move since earnings and still acts well. It worked off that major reversal on 2/15 to hold its 10 day moving average. Stock is now in from of its previous high that could give it a pause. See if it can go green for a cash flow trade today, but I would like to see a few days of consolidation before it attempts to take out $525-$526 pivot high.
IBM– nice break out last week, holding above $195 would be good
CRM– great earnings gave investors upside follow through. We outlined this when it broke it’s Descending channel in the $120 area
VMW– also had a nice move but can use a rest.
GOOG– trying to hold the mid-level range but not compelling – if you’re long make sure it holds $597 and it you are looking for it to go in motion to the upside. It needs to clear $615-$618
INTC– is trying to hold important support- I think it’s pretty important to hold $26-$26.30
NFLX– Stock has been a great vehicle to trade in 2012. Recently guys Caught a nice short below $122-120- stock partially filled its earnings gap and now has a three day range to trade against. Recent low is $108.54. Watch closely.
AMZN– I still think we have a Macro Bearish Pattern Developing. A trade and close below $170-$175 should put this in Downside Motion. It’s tricky to trade. But worth keeping on Radar.
Disclosure: Scott J, Redler is Long SPY, OIH, IBM, INTC, MMM, BA, and JPM. Scott is SHORT DIA and QQQ. Scott is Long AMZN and SMP puts.