April 25, 2012
By Mish Schneider
All eyes were on APPL today, but all “they” did was watch!
Apple delivered another blowout quarter, leading to a broad tech rally which put QQQ well over its 50 DMA, and creating an island-like bottom pattern. Curiously, despite all the excitement AAPL’s volume was less than exciting as I’ll cover in the stock specific commentary.
Strength was now limited to the tech sector. Financials, agriculture chemicals, railroads and other areas were also strong helping push the DIA, and SPY’s also safely over their 50 DMA. The IWM, however, remains in warning phase territory. We’ll see if tomorrow can deliver a second daily close over the 50-day and confirm the move back to a bullish phases in the major indexes.
The Fed’s announcement policy announcement and press conference proved uneventful.
S&P 500 (SPY) Back into Bullish phase territory, but must close over the 50-day tomorrow to confirm. The key level to break for more upside potential is the multi-week high of 139.36.
Russell 2000 (IWM) Rallied with the rest of the indexes but still sits below its negatively sloped 50 and 20 DMAs. Lot’s of resistance at 82 and support at 78 so it’s more likely to follow than lead.
Dow (DIA) The laggard of the 4 market watch only up .75% on the day, but like the SPY it’s back over the 50 and 20 DMA. It’s also near the top of a multi-week range with an important high of 131.13. On the downside watch out for trading below today’s low area – 130.
NASDAQ 100 (QQQ) Draw the trend line on the daily chart from the highs in March. A break of today’s high will also break the trend line and confirm the return of the bullish phase. Price action suggested a big bullish day today, but volume was not as impressive. Today’s range was also set in the first half hour of the day, so there is enough consolidation to push the market either way tomorrow.
GLD Tested a key support area of 158 with a swift spike low, and then closed near the high of the day. The trend remains weak, but today was a good test of a basing pattern.
XLF (Financials) Second daily close over the 50 DMA confirming the bullish phase, but still needs to clear last week’s high of 15.51 to look strong. Note the KRE did manage to clear its prior week high.
IBB (Biotechnology) Nice strong day breaking out of 4 days of consolidation. Looks like it wants to go much higher.
SMH (Semiconductors) Still has not closed the gap lower from 4/23! 34 fills the gap, but even then it will look weak.
XRT (Retail) Managed to recover from a very big volume down day yesterday, and close over the 50 DMA. See if it can hold up tomorrow.
IYT (Transportation) Draw the wedge on the daily chart from the lows in Feb. and the highs in March.
IYR (Real Estate) Very impressive breakout of the 52-week high area of 63 which has stopped it at least 7 major times in the last year. This will go much higher if it can hold over the 63 level.
OIH (Oil Services) Relatively weak today and acted like the weak group that it has been for month, but it is basing, and the 10 DMA as turned up.
XLE (Energy) Back to the high of its tight multi-week base at the 200 DMA. A break above 70.41 would fill the gap from weeks ago that has defined the high of the base, and could make this an interesting long candidate.
TBT (Ultrashort Lehman 20+ Year Treasuries) Big range day ending in a doji.
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