Summary: New all-time highs across three of the major indexes is not a bad way to start the week. The 10-year Treasury note auction passed without many surprises, giving the indexes a boost in the afternoon.
Notes
Ideas always welcome in the comments. Errors will be amended as comments on TradingView or corrected inline in my blog.
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Monday, July 12, 2021
Facts: +0.21%, Volume higher, Closing range: 69%, Body: 12%
Good: Higher high, higher low, body and closing range in upper half of candle
Bad: Red body, low advance/decline ratio
Highs/Lows: Higher high, higher low
Candle: Thin red body in upper half of the candle, long lower wick from morning dip
Advanced/Decline: 0.8, more declining stocks than advancing stocks
Indexes: SPX (+0.35%), DJI (+0.36%), RUT (+0.08%), VIX (-0.06%)
Sectors: Financials (XLF +0.98%) and Real Estate (XLRE +0.87%) at the top. Energy (XLE -0.15%) and Consumer Staples (XPL -0.16%) were the bottom.
Expectation: Sideways or Higher
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Market Overview
New all-time highs across three of the major indexes is not a bad way to start the week. The 10-year Treasury note auction passed without many surprises, giving the indexes a boost in the afternoon.
The Nasdaq closed with a +0.21% advance on slightly higher volume. The candle shows a bit of indecision as markets dipped in the morning but then recovered and made gains in the afternoon after the auction. The 12% Red body in the upper half of the candle is above a long lower wick. The closing range is 69%. There were more declining stocks than advancing stocks.
The Dow Jones Industrial Average (DJI) performed the best for the day with a +0.36% advance. The S&P 500 (SPX) gained +0.35%. The Russell 2000 (RUT) opened the day with a loss but climbed back to end with a +0.08% gain.
The VIX volatility index declined -0.06%.
Financials (XLF +0.98%) and Real Estate (XLRE +0.87%) were at the top of the sector list. Financials is kicking off a big earnings week that will be watched closely by investors. Expect investors to focus on guidance as much or more than they do the results. There were only two declining sectors, Energy (XLE -0.15%) and Consumer Staples (XPL -0.16%).
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Economic Indicators
The US Dollar (DXY) advanced +0.13% for the day.
The US 30y and 10y Treasury yields advanced for the day following the 10y note auction. The 2y Treasury yield also all advanced.
High Yield Corporate Bond (HYG) and Investment Grade Corporate Bond (LQD) prices declined.
Silver (SILVER) advanced while Gold (GOLD) declined.h
Crude Oil (CRUDEOIL1!) declined.
Timber (Wood) declined.
Copper (COPPER1!) and Aluminum (ALI1!) declined.
Bitcoin (BTCUSD) declined -3.37%. Ethereum (ETHUSD) declined -4.87%.
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Investor Sentiment
The put/call ratio declined to 0.637. The put/call ratio (PCCE) is a contrarian indicator that shows overly bullish or overly bearish investor behavior. The 0.7 level is considered normal. Below that level is overly bullish.
The CNN Fear & Greed index is moving toward neutral.
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Market Leaders
Of the four largest mega-caps, only Alphabet (GOOGL) advanced for today, gaining +1.16%. Apple (AAPL) declined -0.42%. Microsoft (MSFT) fell -0.22%. Amazon (AMZN) declined just -0.02%. All four are trading above moving average lines.
Tesla (TSLA) and Walt Disney (DIS) were the top mega-caps for the day, both gaining more than 4%. ASML Holding (ASML) and Nvidia (NVDA) round out the top four. At the bottom of the list are Cisco Systems (CSCO), Salesforce.com (CRM), Abbott Laboratories (ABT), and Oracle (ORCL).
Tesla and Nvidia also top the daily update growth list. Joining them in the top four are Peloton (PTON) and NIO (NIO). At the bottom of the list are Fiverr (FVRR), UP Fintech (TIGR), Fastly (FSLY), and Pinterest (PINS).
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Looking ahead
On Tuesday, investors will get a fresh look at the consumer price index data. It's likely to continue showing higher inflation in general. Compare the total CPI number to the Core CPI, which excludes Fuel and Food. Investors will also look closely at what subcomponents drive inflation and how transitory prices will be in those areas.
Weekly API Crude Oil numbers will be available in the afternoon after the market closes.
JP Morgan (JPM) and Goldman Sachs (GS) will kick-off earnings season with pre-market earnings reports. PepsiCo (PEP) will also release earnings in the morning. Another potentially interesting report to watch is Fastenal (FAST) wholesale distributor. Look for signs of more stress or relief in the supply chain.
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Trends, Support, and Resistance
The Nasdaq set a new all-time high but could not hold the level, closing slightly lower.
The trend line from the 5/12 low shows a +0.34% gain for Tuesday.
The one-day trend line points to a +0.06% gain.
The five-day trend line leads to a -0.19% loss.
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Wrap-up
Today's 10y note auction went by without any big surprises. We seem to be past the volatility in Treasure Yields that happened last week.
Now all eyes turn toward the first earnings reports from big banks tomorrow morning. Investors will also react to any surprises with the Consumer Price Index data released before the market opens.
Stay healthy and trade safe!
Notes
Ideas always welcome in the comments. Errors will be amended as comments on TradingView or corrected inline in my blog.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Monday, July 12, 2021
Facts: +0.21%, Volume higher, Closing range: 69%, Body: 12%
Good: Higher high, higher low, body and closing range in upper half of candle
Bad: Red body, low advance/decline ratio
Highs/Lows: Higher high, higher low
Candle: Thin red body in upper half of the candle, long lower wick from morning dip
Advanced/Decline: 0.8, more declining stocks than advancing stocks
Indexes: SPX (+0.35%), DJI (+0.36%), RUT (+0.08%), VIX (-0.06%)
Sectors: Financials (XLF +0.98%) and Real Estate (XLRE +0.87%) at the top. Energy (XLE -0.15%) and Consumer Staples (XPL -0.16%) were the bottom.
Expectation: Sideways or Higher
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Overview
New all-time highs across three of the major indexes is not a bad way to start the week. The 10-year Treasury note auction passed without many surprises, giving the indexes a boost in the afternoon.
The Nasdaq closed with a +0.21% advance on slightly higher volume. The candle shows a bit of indecision as markets dipped in the morning but then recovered and made gains in the afternoon after the auction. The 12% Red body in the upper half of the candle is above a long lower wick. The closing range is 69%. There were more declining stocks than advancing stocks.
The Dow Jones Industrial Average (DJI) performed the best for the day with a +0.36% advance. The S&P 500 (SPX) gained +0.35%. The Russell 2000 (RUT) opened the day with a loss but climbed back to end with a +0.08% gain.
The VIX volatility index declined -0.06%.
Financials (XLF +0.98%) and Real Estate (XLRE +0.87%) were at the top of the sector list. Financials is kicking off a big earnings week that will be watched closely by investors. Expect investors to focus on guidance as much or more than they do the results. There were only two declining sectors, Energy (XLE -0.15%) and Consumer Staples (XPL -0.16%).
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Economic Indicators
The US Dollar (DXY) advanced +0.13% for the day.
The US 30y and 10y Treasury yields advanced for the day following the 10y note auction. The 2y Treasury yield also all advanced.
High Yield Corporate Bond (HYG) and Investment Grade Corporate Bond (LQD) prices declined.
Silver (SILVER) advanced while Gold (GOLD) declined.h
Crude Oil (CRUDEOIL1!) declined.
Timber (Wood) declined.
Copper (COPPER1!) and Aluminum (ALI1!) declined.
Bitcoin (BTCUSD) declined -3.37%. Ethereum (ETHUSD) declined -4.87%.
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Investor Sentiment
The put/call ratio declined to 0.637. The put/call ratio (PCCE) is a contrarian indicator that shows overly bullish or overly bearish investor behavior. The 0.7 level is considered normal. Below that level is overly bullish.
The CNN Fear & Greed index is moving toward neutral.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Leaders
Of the four largest mega-caps, only Alphabet (GOOGL) advanced for today, gaining +1.16%. Apple (AAPL) declined -0.42%. Microsoft (MSFT) fell -0.22%. Amazon (AMZN) declined just -0.02%. All four are trading above moving average lines.
Tesla (TSLA) and Walt Disney (DIS) were the top mega-caps for the day, both gaining more than 4%. ASML Holding (ASML) and Nvidia (NVDA) round out the top four. At the bottom of the list are Cisco Systems (CSCO), Salesforce.com (CRM), Abbott Laboratories (ABT), and Oracle (ORCL).
Tesla and Nvidia also top the daily update growth list. Joining them in the top four are Peloton (PTON) and NIO (NIO). At the bottom of the list are Fiverr (FVRR), UP Fintech (TIGR), Fastly (FSLY), and Pinterest (PINS).
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Looking ahead
On Tuesday, investors will get a fresh look at the consumer price index data. It's likely to continue showing higher inflation in general. Compare the total CPI number to the Core CPI, which excludes Fuel and Food. Investors will also look closely at what subcomponents drive inflation and how transitory prices will be in those areas.
Weekly API Crude Oil numbers will be available in the afternoon after the market closes.
JP Morgan (JPM) and Goldman Sachs (GS) will kick-off earnings season with pre-market earnings reports. PepsiCo (PEP) will also release earnings in the morning. Another potentially interesting report to watch is Fastenal (FAST) wholesale distributor. Look for signs of more stress or relief in the supply chain.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Trends, Support, and Resistance
The Nasdaq set a new all-time high but could not hold the level, closing slightly lower.
The trend line from the 5/12 low shows a +0.34% gain for Tuesday.
The one-day trend line points to a +0.06% gain.
The five-day trend line leads to a -0.19% loss.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Wrap-up
Today's 10y note auction went by without any big surprises. We seem to be past the volatility in Treasure Yields that happened last week.
Now all eyes turn toward the first earnings reports from big banks tomorrow morning. Investors will also react to any surprises with the Consumer Price Index data released before the market opens.
Stay healthy and trade safe!
