Once again, there wasn’t a whole lot to write home about in the market today as the action remains slow heading into Labor Day weekend. Many traders have stepped away from their keyboards for the week, choosing to return to the market when more volume and, with it, clarity returns. The Nasdaq had been the only index to eke out a small gain this week so far, but today all three major indices finished in positive territory.
After some early selling this morning, the market found its footing and rallied most of the day. Google (GOOG) posted its third consecutive impressive gain following the Samsung-Apple ruling that was perceived by many as a blow to the company. The stock broke to 52-week highs today early, and continued climbing in the afternoon.
Notable moves in the market today included Yelp! (YELP), which was presumed to be headed for a drop like many other stocks heading into IPO lock-up expiration. However, most big insiders didn’t sell the stock, the big drop didn’t happen, more buyers stepped in, and short sellers who were anticipating a decline were forced to quickly cover their losing positions. After it was all said and done, YELP closed the day up more than 22%!
Joy Global (JOY) also had a big move intraday today following an earnings-inspired gap down. The stock opened nearly 4% lower this morning after seemingly falling short of the Street’s expectations, but rallied to fill the gap by noon, and then tacked on additional gains in the afternoon. JOY finished the day up 2.5%. The stock was a focus intraday trade for T3Live mentor Pete Renzulli in the Active Trader Mentoring Room, as it fit the bill as a Saturation Play Set-Up.
Today’s action does little to change the technical outlook of the S&P. Last Tuesday’s reversal remains in control of the index in the short-term, but longer-term bullish composure remains intact. The S&P remains above its 21-day moving average and key short-term support at 1398. Even if we were to break the 1398 level, a pullback into the 1391 area, or even lower trendline of the ascending wedge, wouldn’t be the end of the world for the bulls.
By Pete Renzulli
Disclosure: Pete Renzulli has no positions