Earnings have kicked off with a resounding “thud”. AA disappointed the mkt. and now a small degree of fear has crept in. Yet the VIX was down today, because AA came out after the close. The rest of the week we will see some NASDAQ moving earnings that will be topped off with INTC on Thursday and JPM on Friday. I expect both of those to be mkt. movers.
I have to keep it quick tonight because I am so late, and may be late all week. But keep on eye on the earnings and watch how the mkt. moves. Will it sell off on bad news only to fill morning gaps and rally or will it sell off and keep selling. If it is good news, did we do the opposite. These are things I will be watching for to see what the sentiment is and where we may be heading. Often times the mkts. reaction to earnings news can be a signal of things to come, especially early on when we only have a few companies reporting. On to some charts:
The VIX broke waaaayyyyy down today. It looks like it really wants to head straight to that $16 support line. But I think we will see a pop tomorrow, at least initially in the morning.
The DOW , after seeming to be the weaker of the indices, took over the strength role today. I don’t think that will last too long as AA earnings should have a clear impact on the DOW. However, it did breakout today, while the others lagged, perhaps in anticipation of good earnings from AA.
We kind of have a weak hammer formation here, but nothing to write home about. The NAS was very weak today, held up only by the DOW strength. GOOG and AAPL both showed signs of weakness and as the Googapp goes, so goes the NAS.
I have a weird tick on my SPX so I am using the SPY instead today. Note a slight bearish divergence into this up move. These divergences have not been playing out well, but I still like to note them. The SPY is sliding up the top bb, careful not to pierce it. It is still over-bought and still rallying. I think if we see a v pop tomorrow, we see selling.
LNG looks to be breaking out. It took out the 200 on clear strength and v, a strong sign. I would look for a correction, maybe back down to the 200 ma and then some more up movement.
As I said, INTC reports on Thursday so keep an eye on it. It opened right at the open of that high candle from Oct, but failed to break above. Going into earnings, if the consensus is that they will do bte, then I think we keep rising here. If worry sneaks in, then some fast selling.
Check this out, perhaps some foreshadowing on AA. A great doji setup going into e. Maybe somebody knew something. I am curious, was this rally from Dec in anticipation of great e? If so, then I think we will see at least $14 before the move is over.
In closing: I have a lot to do this week to get ready for our trip to Costa Rica this weekend. I will do my best to post at night this week, but no promises. Watch e closely, see what the sentiment is going in , and if it returns after the initial move in the morning. Trade well and prosper. AKOT
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