Markets for the second consecutive day showed resilience after early morning gains of nearly 1% for the S&P 500 and Nasdaq faded to losses then turned around and went out near session highs. The S&P 500 rose .8%, its progress halted at the round 2000 figure and 50 day SMA. The Nasdaq recorded a bullish hammer and advanced .9%, respectable given the fact that 2 of its largest components AAPL and GOOGL fell Wednesday. Benchmarks once again took their cues from the crude market early on as it found problems not surprisingly at the very round 50 handle. The best performing groups, once again without sounding like a broken record, came from your risk on sectors, the energy and materials. Seems like their is some very recent infatuation with the group as JPM upgraded RIO and BHP and interestingly downgraded BTU as it seemingly was on a path to zero. Not sure where they stood prior to the call this morning but the timing after such a waterfall run lower is off base a bit I would say. The stock may have bought itself a little more time with the 1 for 15 reverse split. As of today it rests “only” 87% off recent 52 week highs. The homebuilder group remains solid and some evidence of that today was a well received earnings report with the stock jumping almost 4%. Others in the group acting firm today were LGIH and TILE. Even LL jumped double digits after hours after a settlement was reached with the SEC. Below is the chart of TILE and how it was presented in last Fridays Game Plan. After todays run of 5.5% on the best volume in 6 weeks one can now enter above the 50 day SMA and then through the 25.95 double bottom trigger.
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