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The stock market forged a very impressive extension of its recent upward track yesterday and is seemingly set to add to that effort early today. We continue to see the 1100 level in the March S&P as a critical resistance zone but for the next few trading sessions, it would seem like the bull camp is capable of extending its control. We are not sure if the continuing shift in political power in the US is behind the recently improved sentiment, or if the improvement in sentiment is being derived from favorable corporate earnings or from the 30 day grace period for Greece, but the trade does seem to be spinning the headlines into mostly favorable stories. At least in the early action today we saw financial/bank sector stocks mounting gains in the early European trade and that looks to start the US action out on a slightly positive tilt. However, sentiment isn’t definitively positive and the bull camp in stocks probably needs distinct help from both the US Housing starts and permits reports and also from the US Industrial Production/Capacity Utilization readings. So far, it is unclear how the markets will react to news of another “bi-partisan” debt reducing effort from Washington, mostly because cooperation in Washington has become a very rare event. In conclusion, we suspect that the numbers will be partially acceptable today, but that gains today will probably be smaller than yesterday.
S&P 500: Unlike other sectors of the market, the March S&P hasn’t managed an upside breakout on the charts. However, the S&P has managed to extend the recent pattern of gains and did forge a higher high for the move this morning. Initial support is seen at 1093.90, with initial resistance seen up at 1101.50. At least into the opening today, we concede to a bullish edge in the market, but we are not sure if a negative US housing permits reading will fully take the edge away from the bull camp.
DOW: With the March Mini Dow managing to post some positive early action this morning and in the process managing to forge a quasi upside breakout on the charts, one has to leave the edge with the bull camp. Unfortunately, we doubt that the first set of scheduled US data will provide a conclusively bullish reading from the US housing front and that could diffuse a portion of the early bullish tilt. At least into the opening today, support in the March Mini Dow moves up to 10,241, with initial resistance pegged up at 10,310.
NASDAQ: Like the Mini Dow, the Nasdaq has also managed an overnight extension of the recent bull track, with the March Nasdaq reaching the highest level since January 28th. Apparently the smaller cap stocks are being pulled higher by favorable views toward financial and large cap stocks and that leaves the bull camp with a slight edge into the US opening today. Initial support in the March Nasdaq is currently seen at 1797.75, with resistance today pegged at 1808. For the time being, the broad macro economic view looks to be the main factor driving stock prices.
TODAY’S MARKET IDEAS: The bulls still have the edge but upside momentum looks to be waning and the bulls probably need some help from the numbers.
Stock Market Commentary – 2010.02.17
by Dave Hightower on February 17, 2010
Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
The stock market forged a very impressive extension of its recent upward track yesterday and is seemingly set to add to that effort early today. We continue to see the 1100 level in the March S&P as a critical resistance zone but for the next few trading sessions, it would seem like the bull camp is capable of extending its control. We are not sure if the continuing shift in political power in the US is behind the recently improved sentiment, or if the improvement in sentiment is being derived from favorable corporate earnings or from the 30 day grace period for Greece, but the trade does seem to be spinning the headlines into mostly favorable stories. At least in the early action today we saw financial/bank sector stocks mounting gains in the early European trade and that looks to start the US action out on a slightly positive tilt. However, sentiment isn’t definitively positive and the bull camp in stocks probably needs distinct help from both the US Housing starts and permits reports and also from the US Industrial Production/Capacity Utilization readings. So far, it is unclear how the markets will react to news of another “bi-partisan” debt reducing effort from Washington, mostly because cooperation in Washington has become a very rare event. In conclusion, we suspect that the numbers will be partially acceptable today, but that gains today will probably be smaller than yesterday.
S&P 500: Unlike other sectors of the market, the March S&P hasn’t managed an upside breakout on the charts. However, the S&P has managed to extend the recent pattern of gains and did forge a higher high for the move this morning. Initial support is seen at 1093.90, with initial resistance seen up at 1101.50. At least into the opening today, we concede to a bullish edge in the market, but we are not sure if a negative US housing permits reading will fully take the edge away from the bull camp.
DOW: With the March Mini Dow managing to post some positive early action this morning and in the process managing to forge a quasi upside breakout on the charts, one has to leave the edge with the bull camp. Unfortunately, we doubt that the first set of scheduled US data will provide a conclusively bullish reading from the US housing front and that could diffuse a portion of the early bullish tilt. At least into the opening today, support in the March Mini Dow moves up to 10,241, with initial resistance pegged up at 10,310.
NASDAQ: Like the Mini Dow, the Nasdaq has also managed an overnight extension of the recent bull track, with the March Nasdaq reaching the highest level since January 28th. Apparently the smaller cap stocks are being pulled higher by favorable views toward financial and large cap stocks and that leaves the bull camp with a slight edge into the US opening today. Initial support in the March Nasdaq is currently seen at 1797.75, with resistance today pegged at 1808. For the time being, the broad macro economic view looks to be the main factor driving stock prices.
TODAY’S MARKET IDEAS: The bulls still have the edge but upside momentum looks to be waning and the bulls probably need some help from the numbers.
Tags: DOW, Financials, NASDAQ, S&P 500, Stocks
About Dave Hightower