Stocks Continue To Inch Higher

NASDAQ futures are set for a slight gap down opening after an overnight session featuring normal range and volume.  Price traversed most of the Friday range, holding the low before zooming higher to briefly make a new swing high before retracing most of the move.

On the economic calendar today we have Existing Home Sales at 10am and a 3- and 6-month T-Bill auction at 11:30am.

Last week price worked higher.  NASDAQ waited to hear the FOMC rate decision then proceeded to rally through the end of the week.  Friday we printed a normal variation up on a session that was balanced overall.

Heading into today my primary expectation is for buyers to push into the overnight inventory and close the gap up to 4394.75.  From here look for a move to take out overnight high 4414 before two way trade ensues.

Hypo 2 strong buyers push up through overnight high 4414 and work higher to target 4425 before two way trade ensues.

Hypo 3 sellers push down through overnight low 4376.75.  Look for responsive buyers down near 4360 and two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

How quickly we can cast aside the murderous ways of our fiendish stock market and warmly embrace its elegant allure.

The rally that began in mid February has gone far and fast by any stretch of the imagination.  Nay to he who says the action is ‘too’ anything; far, fast, mere perceptions of the mind they are.  These claims are akin to the perverse word ‘should’ …a verb that reveals your intent, your attempt to impose your will upon the market.

The thing is, the market has been around since long before your existence, and it will continue to exist long after you are gone.  It owes you nothing and shalt not bend to your will.

Anyhow, my model is registering its highest scores ever, again, trumping last week’s all time-high scores.  These are unprecedented times for my model, but what scant information we have suggests a high score lends itself to bullishness.

So we’re bullish despite the rally seeming a bit mature.

See also:  Gartman: Everyone Loves $37 Crude; ‘Nirvana’ For Stocks to Ensue!

Exodus members: the latest Strategy Session has been published.  Be sure to check it out and let me know if you have any questions.

NASDAQ futures are priced to open modest gap up after a balanced overnight session featuring normal range and volume.  The Globex session was literally the most mild one, year-to-date.  Price held yesterday’s mid on a test down to up and is now up near weekly highs.

On the economic agenda we have U of Michigan Confidence at 10am and Baker Hughes rig count at 1pm.

Yesterday we printed a normal variation up.  There was a hard move lower off the open that quickly fizzled out and price spent the rest of the session churning higher.

Heading into today my primary expectation is for sellers to push into the overnight inventory and close the gap down to 4393.  From here look for a move to take out overnight high 4405.75 then continue higher to probe above the weekly high 4407.75 before two way trade ensues.

Hypo 2 buyers keep the gap open and race up through overnight high 44057.75 early on before sustaining trade above 4407.75 to set up a move to target 4416 before two way trade ensues.  Stretch targets on the upside are 4424.75 then 4444.75.

Hypo 3 sellers close gap down to 4393 then take out overnight low 4384.25.  Look for responsive buyers down at 4378.50 before two way trade ensues.

Hypo 4 strong sellers show up, take out overnight low 4384.25 then set out to target 4343 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

NASDAQ futures are priced for a gap down after an overnight session featuring elevated volume and range.  Price breached the Wednesday high before rolling over early this morning.  On the way down, price managed to hold yesterday’s range before settling into two way trade.  At 8:30am we heard from the Philadelphia Fed and also Initial/Continuing Jobless claims.  The initial reaction is buying.

Also on the economic calendar today we have JOLTS Job Openings and Leading Indicators at 10am, and at 1pm there is a 10-Year TIPS auction.

Yesterday we printed a double distribution trend up.  The gap down to start the session was quickly bid up in an opening drive.  Sellers worked in ahead of the Fed rate decision by were ultimately overrun during the reaction to the unchanged rates.  Price worked higher to close the 10/21 open gap at 4399 before responsive sellers stepped in and faded the move.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4386.75.  Look for sellers to defend the 4400 century mark before a long balance takes hold.  Late in the session look for a move to take out overnight low 4359.75 before two way trade ensues.

Hypo 2 strong buyers close overnight gap up to 4386.75 then push up through 4400 and sustain trade above it setting up a move to take out overnight high 4412.75.  Look for responsive sellers up at 4416.  Stretch targets are 4424.75 then 4444.75.

Hypo 3 sellers gap and go lower, take out overnight low 4359.75 early then work down to target 4343 before two way trade ensues.

Levels:

Volume profiles, gaps, and measured moves:

Shares of FedEx are set to open St. Patty’s day a bright hue of green after reporting strong earnings.

(RTTNews.com) – Package delivery giant FedEx Corp. (FDX), Wednesday reported a third-quarter profit that beat Street estimates, driven largely by strong revenue growth at FedEx Ground segment. The company lifted its full year outlook, sending its stock up by 5 percent in after-hours trading.

Memphis, Tennessee-based FedEx’s third-quarter profit dropped to $507 million or $1.84 per share from $628 million or $2.18 per share last year.

Adjusted earnings for the quarter rose to $2.51 per share from $2.03 per share last year. On average, 23 analysts polled by Thomson Reuters expected earnings of $2.34 per share for the quarter. Analysts’ estimates typically exclude special items.

Revenues for the quarter increased to $12.7 billion from $11.7 billion last year. Wall Street analysts had a consensus estimate of $12.4 billion.

Revenues for FedEx Express declined 1 percent to $6.56 billion, while FedEx ground revenues increased 30 percent to $4.41 billion from last year. Revenues for FedEx freight rose 1 percent to $1.45 billion.

Looking forward to full year 2016, FedEx tightened its adjusted earnings forecast to $10.70 to $10.90 per share from prior outlook of $10.40 to $10.90 per share. Analysts currently estimate earnings of $10.56 per share for 2016.

Being a global transportation companies, the performance of shipping giants like FedEx and its rival United Parcel Service Inc. (UPS) are considered a strong barometer of overall consumer attitude and economy.

FedEx is one of the many carriers servicing the last great retailer, Amazon.  Thus they serve as a proxy for the health of the consumer space.  By the looks of it, retail is booming.

If you think of the economy as a human body, delivery and transportation are the blood in the system.  The stronger the vascular flow, the more powerful the economy.

FedEx having a strong quarter makes it tough to be bearish on the retail space, especially companies investing into their online experience.

See also: Dick’s Amazing Comeback! Trading Earnings Calls

Third reaction Fed analysis, a sophisticated method of identifying the three major rotations after the rate decision, yielded the buy and I went to work vanquishing short sellers.  Participation is limited to the day time frame however, because this market is setting up just like I have envisioned over the last two weeks.

See also: The Dow Is Forming The Wedge

There was a clean improvement from the internals that gave confidence to the long trade this afternoon.  After FOMC, Net Tick improves substantially, blasting up to session high and holding the gains:

Then, despite 4 big sell programs running on the NASDAQ 100, the robots were trumped by two huge buy programs running over at the NYSE.  These you can go with intraday, but tell a story going forward [more on that in a moment, first observe the algo wars]

When NYSE ticks hard, and this is only an observation, it tends to mark the crescendo of a move.

See also: All The Fixings for a Rally

With my last long closed, I have initiated a short position on the NASDAQ, via the QID, a position I will add to should we close out the week strong.

NASDAQ futures are set to open gap down after an overnight session featuring normal range and volume.  Price briefly exceeding yesterday’s high on balanced trade.  At 8:30am the Consumer Price Index came out slightly better than expected [1.0% vs 0.9% expected] and introduced sellers who worked price below the midpoint of yesterday’s session.

There are several economic data points out today, with the FOMC Rate Decision at 2pm being the most significant.  The consensus forecast is for rates to stay unchanged at 0.50%.  The announcement will be followed by a press conference with Fed chair Yellen at 2:30pm.  Also on the docket we have Industrial/Manufacturing Production at 9:15am and crude oil inventory at 10:30am.

Yesterday we printed a normal variation up.  it was a quiet session that briefly pressed to a new weekly low before printing a failed auction near last Friday’s VPOC and began trading higher.  Price slowly worked the overnight gap fill before settling into two way trade.

Heading into today my primary expectation is for buyer to work into the overnight inventory and close the gap up to 4356.  From here look for a move up to 4360 before we settle into two-way trade ahead of the FOMC.

Hypo 2 sellers use this news-driven sell momentum to continue pushing lower and test yesterday’s low 4329.  Look for sellers to continue down to 4322.25 before two way trade ensues ahead of FOMC.

Hypo 3 strong buyers close gap up to 4356 then take out overnight high 4369 before settling into balance ahead of the Fed. Stretch targets are 4400 then 4407.

Levels:

Volume profiles, gaps, and measured moves:

NASDAQ futures are set to gap down after an overnight session featuring normal range and volume.  Price pushed lower for most of the session and briefly tested below yesterday’s low before finding a responsive bid and settling back into balance.  At 8:30am Advance Retail Sales came out slightly better than expectations.  So far participants have not reacted to the news.

On the economic docket today we have NAHB Housing Market Index and Business Inventories at 10am, a 4-week T-Bill auction at 11:30am, and Net Long-Term TIC Flows at 4pm.

Also note, tomorrow afternoon The Fed rate decision will be announced. With this major news event looming on the horizon, the market will likely put all directional discovery on hold.

Yesterday we printed a double distribution trend up.  While the other indices managed to give up most of their gains late yesterday, the NASDAQ held above the MID after having a slow uptrend all day.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4357.50.  From here look for a move to test above overnight high 4359.25 before two way trade ensues.

Hypo 2 sellers hold price below 4350 setting up a move down through overnight low 4330.  Look for responsive buyers down at 4315.50 and two way trade ensues.

Hypo 3 strong selling pushes down through 4315.50 and sustains trade below it, setting up a move to test the 4300 century mark before two way trade ensues.

Hypo 4 strong buying sustains trade above overnight high 4359.25 setting up a move to test above the Monday high 4370.25. Stretch target is 4400.

Levels:

Volume profiles, gaps, and measured moves:

NASDAQ futures are set to open the week gap down after an overnight session featuring normal range and volume*.   Price held the upper half of the Friday range on quiet, two-way trade.

*Volume data will be skewed this week, however, due to some participants staying behind and trading the March contact while most move forward to June.

On the economic calendar today we have a 3- and 6-month T-Bill auction at 11:30m.

Last week was a slow grind down through Thursday.  Early Thursday we heard from the ECB, who pushed their key borrowing rate down to negative 0.40% while promising additional monetary stimulus.  This jostled the NASDAQ a bit, opening it gap up before heavy selling came in. The heavy selling was ultimately reversed, effectively trapping sellers down in ‘the hole’.

Friday price opened gap up and slowly churned higher.

Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 4345.75.  From here a move to take out overnight high 4350.75 sets up a test above last week’s high 3453.75 before two way trade ensues.

Hypo 2 sellers work down through overnight lo 4331.50 and find responsive buyers down at 4315.75 before two way trade ensues.

Hypo 3 strong selling pushes price down through 4315.75 to test below the Friday low 4309.  Look for a move down to the 4300 century mark before two way trade ensues.

Levels:
Volume profiles, gaps, and measured moves:

Too far, too fast sentiment is strong both in stocks and oil.

National angst is through the roof.   Warm weather rolled into northern city centers, agitating the populous and stoking the angry political types into riot mode.

Turning our attention to data, which is an objective judgment of the current facts, my bias model generated its highest reading ever.

Typically high reading indicate the lens of index price has been painted a lovely rose hue, skewing investor perception ahead of the proverbial rug pull, the ebb, the down move if you’re not into idioms.

But when the model scores really high [past performance is not indicative of future results] the market has continued higher the following week.

It would be selfish to hoard this data, since you all have supported me on my path to trading excellence.  The other dates logged in the model where bias score has skewed extremely high were:

• 02/22/2015
• 04/27/2015
• 10/18/2015
• 03/06/2016

Here’s every score, to date:

Finally, and the kicker that could trigger an explosive move, we have an FOMC rate decision Wednesday afternoon, WITH a Janet Yellen press conference after.  Consensus is for The Fed to keep its key borrowing rate unchanged at 0.50%.  I could see a surprise 12.5 basis point rise triggering a move higher.

All the pieces are in place for a rally.  Whether or not it materializes is, as always, TBD.

See also: The Dow Jones Is Forming The Wedge

Members of Exodus.  The latest Strategy Session has been published.  Be sure to check it out.  Feel free to ask me anything regarding it, inside Exodus or on Snapchat: VCali