Morning Coffee, Thursday 21 April, 2011

Market in America had a great rally on the back of tech stock reports - especially Intel.  Apple has reported after hours and, according to Yahoo Finance, "crushed" expectations.  Meanwhile, back at the ranch, the Banks and Greece are still a worry.

In America:

1. Dow Industrials +1.52% 
2. Dow Transports +0.38%
3. SP500 +1.35%
4. Russell 2000 +2%
5. Nasdaq100 +2.21%

Comment: Apart from the Transports, all the major indices traded strongly higher. Breadth was very good.  The Materials Sector was in line +1.32%.  That's a plus for Australia today.  The Banking Sector was down -0.48%.  Semi-conductors was up 4.27%.  That's a tale of two economies - housing is weak, technology is powering ahead.

Europe

1. France +2.46%
2. Germany +2.98%
3. London +2.13%

EWA (Australian Shares ETF traded on the New York Stock Exchange) +2.97%, The Australian Dollar was up +1.67% to finish at 107.04.  (Here comes 110?)

Technical Comment on the American Market:

1. The S&P 500 finished at 1330.36.  
2. The Index is below the 50-Day MA but lifted at important support.  That's a positive.  
3. Indicators:
• Slow Stochastic back above its signal line and rising.  Positive
• Well above the 13-Day MA.  Positive
• RSI above its mid-line, now 57.02.  Positive
• MACD Histogram below Zero.  Negative.  But rising - positive
• CCI +43.8 and rising.  Positive.
4. Volume was the good and very strong over the past five days.

The positive seasonality in the week before Easter is playing out.  Tonight should be up again

  

In the past 24-Hours Gold in Ozzie Dollars has fallen -0.84%.  That's a positive for our broad market.  (Last night I heard a "stock market strategist" on the ABC raving about the big rise in the price of Gold.  Oh yeah - in U.S. Dollars not Ozzie Dollars.  Talk about band-waggoning.  How do these guys earn their keep?)

And the price of oil remains high.


Today's action was very positive.  Helped by a short squeeze.  There's probably more in this, but the back-drop of a poor performance in the Banks, Europe debt problems, and the disturbingly high price of oil will might put the dampeners on this in a few days.  Strong resistance lies ahead.  It's hard to see how the market can overcome that resistance with fundamental issues like those.  But - I could be wrong.  Wouldn't be the first time.  :)


Good luck
Red