Normally, we would have sent you out some notes last night that would have said:
The market topped today as a ton of stuff ran into the declining 50 day moving average and sold off. On top of that, just about all the narrow leaders came in hard with some failed breakouts and even the big strength coming in. Leader SHOP hit a high of $665, hit a low of $556 before settling at $585. It is trading over $$600 in the pre-market. It was also an AMD that gave back just about all gains from recent move. MSFT…which did the same. We could have also listed a few hundred names that were sold down hard on volume as they hit resistance (50 day moving average). And that is the stronger stuff.
But normally, is not what it used to be. With central banks printing trillions for the sole reason of keeping markets from falling down, we have to keep both eyes wide open. AND, almost like clockwork, we gap back up today. We made the conscious decision to wait for the morning to say anything. A little article on what central banks are doing. It is not small:
We are big believers in the big picture. We suggest it is more than mixed as a good percentage of the market has been much weaker than these names that have rallied and sold off into the 50 day. If they cannot hold today’s strong open, it could possibly and normally be a big sign. But there is that word “normally” again.
At the very least, know that the institutional crowd distributed whatever was leading yesterday and will be watching closely today. We are in the midst of earnings season. NETFLIX (NFLX) was trading at $470 in after hours but gave it all back and more, trading at $427 as we write this. Seeing some other gaps this morning in CMG, STM, SNAP, TXN, TER. There are a lot more names to come in earnings season.