When I awoke this morning DJIA futures were up over 100 points... or perhaps that was just a dream. By the end of today's trading session it sure felt like it. Another manic Monday choc full of headlines.
Just before the market opened for trade I posted this chart and noted how weakness was starting to take hold as the overnight exuberance was starting to fade.
The market stabilized at the open, but then a wave of selling took over and the indices plummeted.
Despite the morning collapse not everything was trading lower today. $TWTR neared $41 before suffering a sharp reversal.
$FEYE was already soaring higher when word of the ISIS hacking started to spread. The Cyber Security theme is a popular one this year, and rightfully so. I think the stock has a lot more room to go higher, but keep fresh in your mind that last Tuesday $FEYE dropped over 8%, and was under the $30 handle. Tuesdays and $FEYE don't seem to mix, let's see if tomorrow is different.
Who can go a trading session these days without talking about crude oil? Oil continued its move toward $0.0001 , with a 5%+ plunge to the downside.
And the US Oil Fund
Some of the USO strikes today moved over 100%, and had this move happened in the mundane months of spring last year they'd have moved over 200%, but the market is already pricing in significant price potential. 100% is still a very nice gain....if I do say so myself.
If you didn't catch this article from the morning reads, I am posting it again as I think it gives a great overview of what looms ahead for the banks amid a crumbling oil.
Earnings season is kicking off this week. Alcoa reported earnings tonight:
Alcoa (AA) shares rose 1.4% to $16.39 on heavy volume after the company reported adjusted fourth-quarter earnings of 33 cents a share on revenue of $6.4 billion.
Analysts polled by FactSet had forecast a profit of 28 cents a share on revenue of $6.04 billion for the aluminum giant
We have $JPM, $WFC, and $GS leading the way this week. Earnings season really starts to snow ball into the end of the month. Take the recent volatility , add earnings season to it and we could be looking at some even more bumpy trading ahead.
What Will Tomorrow Bring?
The $SPY broke through key Abenomics support today. Overall the S&P500 is in a channel and finding support at the upper and lower ranges
The trend remains to the upside, but the crash in oil presents uncertainty. Once the price of oil stabilizes I think you can be more confident about this market making the move to new record highs. But until that time happens, indivual names continue to work. $WMT, $BIG, $TWTR, $FEYE, lower prices at the pump are giving consumers more money to spend... in theory. We'll know more when earnings reports start to come in.
The market has been lower 7 out of the last 9 trading sessions. This is certainly not a good sign. However take it with a grain of salt..... Today I saw one statistic that compared the recent trading to previous times in history and noted that any sell-off similar to the one we are experiencing to start 2015,has resulted in a year of negative returns only ONCE. The odds still favor a positive year for 2015.