Price Reset!

Wall Street fell strongly yesterday, the S&P 500 and the Dow Jones suffering their worst trading day in a month-and-a-half after the latest tech stock declines intensified and offset the banking sector’s strength.

The tech sector (XLK), which has led the S&P 500 to rally 8% year-to-date, fell 1.8% yesterday, making in the market’s biggest daily loser. The declines on the sector were not limited to but included Apple (AAPL), and Microsoft (MSFT), which weighed more than anything, on the S&P 500.

Financial stocks (XLF) and energy stocks (XLE) were the only sectors that traded up yesterday, investors injecting funds into the sectors which have lagged year-to-date.

U.S. stocks have been trading at high valuations and close to their historic highs for quite some time, faith in their underlying value flagging – and now being put to the test. With few significant catalysts that can propel stock prices higher, market prices need a reset, precisely what we saw yesterday!

In Summary for the Day: The Dow Jones fell 0.78%, the S&P 500 shedding 0.86%. The NASDAQ was the worst performing of the three large indexes, dropping 1.44% and closing beneath its 50-period EMA for the first time since April 13th; this close beneath the technically significant level could spark further declines. Gold fell 0.3%, crude though rising 0.4% with its sixth consecutive winning day.

The VIX, which is thought of as the market’s best fear gauge – measuring short-term volatility – soared to a 6-week high to the 15.6 point level, before backtracking to some degree before closing.

The second quarter wraps up today, the rise in volatility most certainly felt over the last few days, the NASDAQ, this past Wednesday, having recorded its best trading day since November 7th.

Financial stocks (XLF) were the light at the end of the tunnel with gains of 0.7%, banking stocks rising after the Fed approved 34 banks’ plans to execute stock buybacks and issue dividends after they successfully passed the central banks’ stress tests. In essence, stress tests measure how banks would fare in a severe financial crisis. The stocks that stood out in the sector included Wells Fargo (WFC), which soared 2.7%, and Citigroup (C), which jumped 2.8% after announcing that it would raise dividends by 100% and buy back $15.6 billion shares.

Another stock of note was GRPN which rallied 4.3% after receiving a rating upgrade. LULU soared 5.2% after the company’s CEO announced that he was buying $5.5 million in shares. RAD toppled 26.5% after it and the drugstore chain, WBA, announced that they were ending their merger plans after failing to receive regulatory approval.

In Summary: This is the best opportunity bears have had in months. The NASDAQ is beneath its 50-period EMA, a level at which the index hasn’t traded in months. The question is whether the bears can translate this isolated losing day into a trend with lasting effect. This is something that they haven’t succeeded in doing since November 8th, U.S. Election Day.

About 7.9 billion shares traded hands on U.S. exchanges, above the 7.3 billion average over the last 20 trading days.

Friday: Today is the last trading day for June, Q2, and the first half of the year, all in one! And a lot hinges on what happens today! Take for example the S&P 500 which is now traded off 0.61% on the week, though only negligibly down by 0.04% on the month. The market’s performance today will in large part determine whether June goes down as being in the red or in the green. The heretofore performance for the quarter is more secure, with gains of 2.14%.

Today’s Economic figures will command attention, traders eyeing private income and spending figures which are expected to be released today before opening at 8:30 N.Y. time, the University of Michigan Consumer Confidence Index reading then coming out at 10:00.

The stocks expected to see volatile movement today include NKE, and MU, which both reported yesterday after closing.

IndexLastDaily change
DJX(0.78%)21,287Down
SPX(0.86%)2,420Down
Nasdaq(1.44%)6,144Down

Friday’s Hot Stocks: MU, NKE, AOBC

IPOs: BY, AKCA, TNTR

Have a great trading day!

 

Economic Calendar

 

DAYTIME (EST)EventForecastImpact
Monday8:30Durable Orders-0.6%Medium
Tuesday10:00Consumer Confidence116.7Medium
Wednesday10:30Crude Oil InventoriesLow
Thursday8:30GDP – Third Estimate1.2%High
Thursday8:30Initial Claims241KHigh
Friday8:30Personal Income0.3%Medium
Friday8:30Personal Spending0.1%Medium
Friday8:30PCE PricesMedium
Friday9:15Chicago PMI57.8Medium
Friday10:00Michigan Sentiment – Final94.7High

 

Earning Calendar

 

SymbolCompanyAM/PMDay
FDSFactSet Research Systems Inc.BMOTuesday
DRIDarden Restaurants, Inc.BMOTuesday
PAYXPaychex, Inc.BMOWednesday
GISGeneral Mills, Inc.BMOWednesday
MONMonsanto CompanyBMOWednesday
WORWorthington Industries, Inc.AMCWednesday
MKCMcCormick & Company, IncorporatedBMOThursday
CAGConagra Brands, Inc.BMOThursday
WBAWalgreens Boots Alliance, Inc.BMOThursday
STZConstellation Brands, Inc.BMOThursday
NKENIKE, Inc.AMCThursday
MUMicron Technology, Inc.AMCThursday

  

Today’s Picks – Day Trading!

SymbolBreakoutBreakdownMomentumMomentum
KITE103.81SCSSCAG
VMW85.45LULUDATA
USG27.89 KHC
  VMW
  DATA

 

New York Strategy Swing

#DateStockLong\

Short

StatuesData CloseProfit\

Loss

11.5.2017AAOILongClose2.5.2017+0.54%
23.5.2017SCSSLongClose9.5.2017-1.71%
34.5.2017CRZOShortClose5.5.2017+0.30%
48.5.2017WTWLongClose16.5.2017+6.09%
515.5.2017AANLongClose16.5.2017-1.70%
616.5.2017CCLLongClose17.5.2017-0.41%
717.5.2017AMAGShortClose24.5.2017+5.38%
817.5.2017AANLongClose24.5.2017-2.59%
919.5.2017TRCOLongClose23.5.2017-1.45%
1019.5.2017GIMOLongClose26.5.2017+2.05%
111.6.2017BF.BLongClose6.6.2017+0.95%
127.6.2017LULULongClose9.6.2017-2.24%
1314.6.2017SIGShortClose23.6.2017+2.29%
1416.6.2017AABA (YHOO)LongClose26.6.2017+3.14%
1521.6.2017KRShortClose27.6.2017-2.75%
1629.6.2017DKSShortOpen +1.76%
17
18  

 

Today’s Picks – Swing “New-York Strategy

 No.1 –  DRI

Company NameDarden Restaurants
Entry Point92
Stop Area90.85
1st Target92.60
Swing Target95.22
Avg. Volume1.53M
SectorServices | Restaurants
Earning Date
Risk RateNormal
Risk\Reward Ratio2.80:1

 

No.2 – ATUS

Company NameAltice USA
Entry Point32.86
Stop Area32.35
1st Target33.25
Swing Target35.29
Avg. Volume10.31M
SectorTechnology | Telecom Services – Domestic
Earning Date
Risk RateNormal
Risk\Reward Ratio4.76:1