Trading Notes for Today, April 29th

Big week for economic  data with the April numbers hoping for improvement. The Jobs report will weigh in on Friday and of course more earnings for the week. The last three weeks have been driven by news and this week isn’t going to be any different. Until we gain some clarity looking forward in the economy and growth news will remain the driver. With that in mind lets look at what’s on tap for today:

Sector Moves of Note:

  1. S&P 500 index fell 3 points on Friday following a bad GDP report. Not much of a test and we will see how this plays today with the futures pointing higher to start the week. The question is will it make a further test or will more buyers step back into the market?
  2. If the S&P 500 index is going to continue higher then it will need the financials to continue the move from last week. The bounce off $17.80 was a positive for the index and the move back to the previous high at $18.60 presents a challenge to break higher. The banks (KBE, KRE) and brokers (IAI) have been lagging the move higher, the leadership has come from the insurance sector (KIE). Watch XLF for a push through the $18.60 level if the broad index is to break higher.
  3. The NASDAQ moved down 10 points to 3279 and is in the same boat as the S&P 500 index. Will the buyers come back to take the index to a new high. The consensus among the street is yes. I have seen crazier and more irrational moves in my career, but we will watch to see how it plays out.
  4. If the NASDAQ is going to push higher it will need some help from the technology sector. The solid recovery from XLK last week from a test of support at $29.25 followed by a move back to the $30 level was a positive. The continuation of that move to the upside will be a key to direction on the week.
  5. Crude oil remains a commodity of interest, and we held our position into this week. Tighten the stop to $28.02 and we will see how it opens the week. Currently slightly higher. Looking for a move to $94.60 and the test lower. If doesn’t continue on upside today willing to take our profit and run near the $28.30 level.
  6. Gold filled the gap, but the moved lower on Friday. The speculation in the metal continues, but I have been looking at the miners for an opportunity. Small bounce off the lows with a big retracement on Friday down 3.6% on GDX and similar move on SIL. Watching these for a trade on the upside. If it doesn’t hold or the reversal picks up GLL will come back into play as a short term trade.

I am going into the week without much on my agenda other than to see the data reports for April and how investors react to the market indexes being back at the recent highs. How bold are the buyers here and will they continue to push the indexes higher despite the data to contrary? Now is a time to be patient and watch for some clarity of in the current move. I will update the tables future as the week progresses.