Stock Market Highlights - Week 19
- BABA surged 7.5% after company introduced Jonathan Lu as new CEO.
- WTI closed 5/8 at $59.39 and Crude Oil $65.39 down 1.6% from last week.
- Janet Yellen said that stock values are "quite high".
- U.S. economy adds 223k April jobs primarily in the business services as wages rise slightly.
- Tesla's Powerwall
sold out till mid-2016 - received estimated $800M worth of orders.
The Dow Jones Industrial Average closed at 18191.11 on Friday, May 8th 2015, which is up about 167 pts from last Friday, May 1st. The ascending triangle trading pattern remains in tack. After it tried yet again to break below the 17800 level, the Dow Jones pulled an impressive bullish candlestick on Friday. Despite Yellen's comments about how the stock values were "quite high", the bulls continued to show that they were in charge.
The stochastic indicators are now not in overbought territory and the chart is set up fairly well for a boost to the upside. We will have to see if the market will be able to follow through from Friday's action. If it does, we have a good chance at further upside. The market has been stuck in range mode for about three months now. When will this break?
The S&P 500 closed at 2116.10 on Friday, May 8th, 2015 up about 8 pts from the previous week. The S&P is posed to break out of its ascending triangle pattern. This is nearly an identical chart to that of the Dow Jones. Probabilities suggest that the bulls will make another run at the top. Any sustained break would make this rally worthwhile to watch. So far we have not been able to see the bears take control or show that they can thwart the bulls. On the contrary, we have yet to see the bulls take full control either.
The Nasdaq closed at 5003.55 on Friday, May 8th 2015. This was a decrease of about 2 pts from last Friday the 1st. The Nasdaq was the only index of the three to have closed down from a week ago. Yet, it looks to be the best set up for a pop above. You can see that it formed an evening doji star this past Monday. Typically these happen when the market gaps up, but bulls or the bears are unable to take control from the opening price. This shows indecisiveness in the market and therefore if the market does gap up, typically you'll see a roll over. In this particular case, this rollover however was short lived and immediately, we saw the prices being bought and followed by a nice gap up candle on Friday that closed just above the 20 DMA. It will be important to see if this can be sustained on Monday.
ProShare Crude Oil (UCO) tracks the price of crude oil. It closed at $9.66 on Friday, May 8th 2015. Typically, you'll see an increase in demand in the summer for oil. As we get closer to that, we'll see prices rise unless supply can match that demand. Technically speaking, we bounced from the 20 DMA, which is positive for the bulls. We'll see some resistance at the $11-$12 price range as those who had positions are looking to exit at break even. Oil is still at historical lows and we are far away from that $100/barrel. There is a lot of room for oil to run; but it won't shoot up as quickly as it shot down. Oil rigs will come into service as certain prices are hit. The higher the price, the more oil rigs will come in and drill, which will keep supply high. Be patient with these positions, it might take a while for them to pay off.
There will likely not be a week 20 or week 21 post as I will be traveling to Australia. Jet lag permitting, I'll do my best to put up a week 21 post.
Labels: Weekly Market Reviews