Bulls Want It More ??

Investor’s first readDaily edge before the open

DJIA:  17,758
S&P 500: 2,081
Nasdaq  Comp:5,083
Russell 2000: 1,187

Wednesday:  Nov. 11, 2015   9:11 a.m.

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      The good news is, the market didn’t follow through on Monday’s decline,

The bad news is, the Fed is holding the Street captive to a decision that at the earliest will come in December, at the latest sometime in 2016.

      For better or worse, the Street should be focused on earnings Q4 and 2016,  economic developments here and abroad, Congressional dysfunction and the Mid-East, since these are issues that really determine whether a market is under or over valued.

TODAY:

      In limbo !  Bulls are afraid to get too in too deep. Bears can’t orchestrate enough fear of a Fed bump in interest rates to drive stocks lower.

      It is positive that the market closed near the highs for the day on Tuesday (a unexciting one-day reversal).  But the market closed at the highs for the day Friday only to plunge sharply Monday.

      One-day reversals up or down,  are most meaningful when they span a wide range between high and low for the day and reverse the market’s direction on heavy volume. That kind of action indicates a major change in sentiment.

      This is Veterans Day. The stock market will be open, but banks are closed.

      If you know a veteran, take a moment to ask about their service, more importantly, indicate your appreciation for the sacrifices they and their families made.

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SUPPORT “today”: DJIA:17,678; S&P 500:2,071; Nasdaq Comp.:5,078

RESISTANCE “today”: DJIA:17,796; S&P 500:2,083;Nasdaq Comp.:5,083

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NOTE: Support and resistance levels are where I expect the intraday prices of the DJIA, S&P 500 and Nasdaq Comp. to reverse or close. Buyers should be cautious when a resistance level is reached but consider buying when support levels are reached. Sellers should consider taking action when resistance levels are reached and defer selling when support levels are reached. These levels are picked daily and based on my application of technical analysis.

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MY TECHNICAL ANALYSIS  of the 30 DJIA Companies

 On occasion, I technically analyze each of the 30 DJIA stocks  for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the DJIA “divisor” (0.149677) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages,
     As of  November 7, 2015,  a reasonable risk is 17,731 a more extreme risk is 17,590. Near-term upside potential is 18,237.
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  • STATUS OF MARKET: Bullish but “at risk” of  a correction, especially Fed-based
  • OPPORTUNITY: RISK: Risk increases with higher market, but light on the Street is GREEN in spite of negatives.
  • CASH RESERVE: 25% – 45% depends on tolerance for risk.
  • KEY FACTORS:  Fed decision on rates; strength of economic rebound; Outlook for Q3/Q4 earnings; Stimulus Europe/China a catalyst !!
  • CONCLUSION: Suddenly, odds of a December bump up in interest rates has increased dramatically. Over the years, the market has sold off when it appeared that an increase was imminent.  It did not do so after the announcement Friday, but did on Monday as the Street began projecting the timing of subsequent rate increases in 2016 – 2017.
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Note: Source of economic data

For a weekly economic calendar and good recap of  indicators, go to mam.econoday.com.

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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication

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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk

 

 

 

 

 

 

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