Also, very predictable as I had said in our Live Member Chat Room at 9:59 am: " Dollar up at 107 from 106 and a bit yesterday is a big drag on the indexes so nothing alarming about being down a bit as long as our levels hold. On /ES, we'd LIKE to see 4,000 but we MUST hold the 50 dma, which is 3,920 at the moment. If we're over the 50 dma, it begins to curve up and that initiates the long march back to the 200 dma at 4,350, which is about the strong bounce line at 4,320 (and will be by the time we get there). "
I'm not going to pat myself on the back for calling yesterday's bottom on the nose. I will, however, pat myself on the back for inventing the 5% Rule™ - which called the bottom on the nose 6 months ago!
All that's happening since then is that the S&P 500 (and the other indexes) as simply obeying their trading range 10% below (and hopefully above) the 4,000 line - which is where we determined the fair value of the S&P to be at this point in time. We would adjust the chart if the macro data changed but we're not going to be panicked out of positions by simple gyrations within our range. "Show me the Recession" - as my friend Cuba Gooding Jr likes to say....
We had some downbeat earnings reports yesterday but there WERE profits, not losses. Last night, we had beats from BXP, BYD, CMG, CB, ENPH, MDLZ, SKX, TXN, V and WH with an 0.06 miss from MSFT but that was still making $2.23 per $252 share for the quarter with revenues up 12.4% from last year - GROWTH, not Recession.
This morning we have beats from ALKS, AEP, ADP, BSX, BMY, CCJ, CME, GRMN, GD, GPC, HES, HLT, HUM, KHC, OTIS, OC, PDS, WM but BA missed, BG missed, INVZ missed, SHW missed, SPOT missed, TMUS missed... It continues to be a stock-pickers market and our job is to identify the sectors and stocks that can grow - even in this rough environment - not to just give up when things get difficult.
It's all about the Fed today at 2pm - I THINK they will stick to an 0.75 hike but the outlook is more important than what they do at this meeting - we'll have to see.
Durable goods came in miles better than forecast by the economic doom patrol we've been subjected to all month had predicted. They said it would be -0.2% and it was, in fact, +1.9% and, not only that, but GM just told us they have Billions of Dollars of unsold inventory waiting for parts to be delivered - that's big numbers down the road as well.
WHR was good yesterday, OTIS, TXN and V all beat - good signs for this report.
