Both the Nasdaq and S&P 500 recorded their back to back up sessions Wednesday of April and each took out the flag were discussed in yesterdays first paragraph. It was good to see the Nasdaq outperform the S&P 500 as it rose 1.55% compared to the S&P 500’s gain of 1%, especially in light of the weak day FB put in. More encouraging was the action of the defensive groups such as the staples and utilities. The staples and utilities were the only major S&P sectors to lose ground today. The XLP fell .8% and now has recorded bearish engulfing candles on Monday and Wednesday this week. The XLU dropped .6% and not sure what excuses the bulls will make their as last week their decline was blamed on many of the names going ex dividend. What did act best today were the financial and materials stocks, each group rising better than 2%. JPM lit the finnie group on fire with a well received earnings reaction of higher by 4.2%. The breadth of the rally has been admirable and even the hated healthcare names have been acted better. I should be more specific and say the biotech plays as many of the device names have acted well throughout. Looking at the IBB chart it bounced right off the round 270 figure which happened to be the trigger in an ascending triangle breakout from 4/6 that was retested Tuesday and held firm. Below is the chart that was highlighted in our Friday 4/8 Game Plan. The stock was up 5.6% Wednesday and now looks to be ready to start building the right side of a cup base.
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