SP500, DJ30, NASDAQ gapped down to the 10 day MA, slight undercuts, now recovering some lost ground in a reflex move. SP400 fell to the 20 day MA, RUTX fell to the 20 day also. A reflex bounce ensued and lost ground was recovered. We have used that to take some more gain off the table on GOOG, AMZN, BABA given earnings are close and we have near term options. Kept some March GOOG options. Took some gain on BIDU, YY as well, also some NVDA though may have been hasty on NVDA. We can move back in if it presents. NFLX? It is holding up really well so letting those positions work for now.
Okay, the market bounced after holding near support. That doesn't look so bad in the first hour, but it is the first hour. With what has stacked up in terms of sentiment and technical indications, while it is very tempting to trade the day, and you can definitely do that, from a multiday and multi-week position view this selling event could well have just started. Yes there is now a bit of a pullback and that might help pops on earnings from GOOG and others, but longer term moves? We did keep longer term options on GOOG for that possibility.
Thus while AMZN may be tempting, it may not be a great position trade overall. That said, I do like what BLUE is showing, and NVDA could be interesting. There are others we are watching, but again, it is just 1.5 hours into the session and the market is suffering some technical and sentiment issues that have developed over time. Big market gains are still there, big earnings still to come. Some nimble trades yes, longer term position upside trades -- not so excited.
SP500 -19.59, -0.67%
NASDAQ -39.35, -0.50%
DJ30 -230.18, -0.87%
SP400 -0.62%
RUTX -0.62%
SOX -0.99%
NASDAQ 100 -0.54%
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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