Market Alert - Last Hour

The stock indices are higher with NASDAQ and SOX leading the rebound in percentage terms.

SP500 10.65, 0.44%
NASDAQ 46.63, 0.75%
DJ30 85.29, 0.40%
SP500 0.52%
RUTX 0.44%
SOX 0.68%

After such a harsh selloff it makes sense they are unleashed to the upside a bit more than the other indices.

The rub: NASDAQ and SOX patterns are not that great. NASDAQ gapped to a doji at some resistance, selling back from the gap but recovering. That leaves a doji just below the 10 day EMA and at minor resistance. SOX shows similar action: gapping upside to the 10 day EMA, fading from there.

These are not great patterns, not ones we would see to buy in starting a new position. That does not mean these two won't continue to chug higher as was the case 4 Wednesdays ago after that violent one-day downdraft. The question comes down to letting existing positions continue to work and picking up new ones.

Thus on positions that have bounced some but are not showing real promising patterns, we are considering closing them if they weaken off their moves. We want to give them the opportunity to recover more, but if they are struggling on this upside session that does not bode well once the relief bounce energy dissipates.

We have picked up some positions, most outside the NASDAQ/SOX group that led the last move, at least outside a position on FB. EXP, DVAC; SCHN. Also looking at MDR if it can hold its gain.

AG Sessions is before Congress answering questions about Russia. Who would have thought that 25 years after the USSR collapsed we would again assign to Russia the pinnacle of our fears? I remember the USSR. I remember the 'KYAGB' (Kiss Your A** Goodbye) civil defense drills in school. The military standoffs. The spies. Sure it goes on now -- Putin is KGB after all -- but it is not the same magnitude. It's all perspective.

But, I digress.

The stock market is up ahead of the FOMC. SPY is just coming off a new session high hit in the past half hour. DJ30, SP400, RUTX are also at new highs. NASDAQ and SOX may simply be the ones that now lag the NYSE indices as they had a market-leading run and come under some profit taking. Between the 'running to the moon' and 'falling off the cliff' scenarios out there now, that would appear the more reasonable.


Jon Johnson, Chief Market Strategist
InvestmentHouse.com
______________________________________
Alert Key
http://www.investmenthouse.com/alertkey.htm

PLEASE DO NOT REPLY TO THIS EMAIL. USE THE CONTACT US PAGE ON OUR WEBSITE.

Customer Support: http://investmenthouse.com/contact_us.php