Not Easy for the Bulls, but……

Investor’s first read Daily edge before the open

DJIA: 18,076
S&P 500:2,114
Nasdaq  Comp.: 5,099
Russell 2000: 1,264

Thursday, June 4, 2015   9:11 a.m.

TODAY:

     The big blue chips still seem to have trouble running freely, but not so with the Nasdaq Comp. and Russell 2000 companies.  It appears the Street is opting for greater growth at greater risk.

     Pre-market trading indicates some selling at the open.  Watch this trading closely. If the bulls are driven to load up, they will be able to over-ride selling and take stocks higher and do so before 10:15.

     If the bulls are unable to offset early selling, more sideways-to-down market action will be needed before the bulls can move the market higher.

     So far, the two are evenly matched.

     Support today is DJIA 18,047; S&P 500: 2,110; Nasdaq Comp.:5,087.

     There is pressure on the pros to make money over and above their greed. Many have clients. They don’t want to get blindsided by a sharp plunge, but really have to take some chances. That means riskier stocks.

ECONOMIC REPORTS

     This is a  big week for reports on the economy. Monday, Personal Income/Outlays; PMI Mfg.; ISM mfg.; and Construction Spend were reported as non-events.  PMI is still adversely impacted by the strong U.S. dollar.

     Factory Orders came Tuesday and were off 0.4 pct. in Apr., the 8th decline in 9 months. The ADP Employment in May, reported Wednesday, was on target, April’s International trade gap improved. PMI Services, ISM Non-Mfg. were positive. Jobless Claims for the May 30 week were down 8,000 to 276,000.The all-important  Employment Situation report hits the market at 8:30 tomorrow.

     With a pickup in U.S. housing, it would be nice if other sectors of the economy would pick up. That can happen if the economy rebounds from Q1’s slump.   

GREECE

The consequences of Greece exiting the Eurozone are so dire, a compromise is likely. Not only would it be devastating to Greece’s economy, but its impact on global banking and financial circles would be dramatic. Don’t be surprised if this is a white knuckle one before resolution (this weekend ?)

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ALERTALERTALERT

     The six months period between Nov. 1 and May 1 has historically been the best six months for the stock market.* The six months between May 1 and Nov. 1 has underperformed. Consistent as this seasonal pattern has been, it must be noted that opportunities to trade against these trends have occurred often.  Analysts and the press will make a lot of noise about this phenom in coming months –  be careful.
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My Technical Analysis of the 30 DJIA Companies:  

On occasion, I technically analyze each of the 30 DJIA stocks  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” (0.1498588) to get the DJIA for those levels.
     As of  May 29, a reasonable risk is 17,917; a more extreme risk is 17,660 The upside potential is has dropped with the market’s inability to follow through last week and is now 18,260.

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KEY EXTERNAL FACTORS: 

-Stock market bubble – China
-Q1 earnings for some companies will suffer from U.S. dollar’s strength and plunge in oil prices.
-Market still keyed on the Fed and it’s first bump up in interest rates, which with a slight softening in recent economic reports looks like it may happen later rather than sooner.
Concern that the U.S. economy is beginning to slump. This week is mixed.

Note: Source of economic data

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

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*Stock Trader’s Almanac

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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