Markets displayed bifurcated action Wednesday as the Nasdaq led the way thanks in large part to AAPL as it launched higher by 7% after a well received earnings report after the close last night (of course it is part of the Dow now as well and gave the price weighted index a bump). The Nasdaq rose .5%, giving up almost half its intraday gains, and the S&P was essentially UNCH narrowly missing a 5 session losing streak. The Nasdaq is looking to outperform the S&P 500 for the second consecutive week as both benchmarks are lower so far with the Nasdaq down .3% and the S&P 500 by .7% thus far heading into Thursday. Both of the aforementioned indexes are still in very clear uptrends with nicely rising 50 and 200 day SMAs and finding continuous support at their respective 20 day SMAs too. Technology was the best actor Wednesday and the laggards were well recognized too as energy and utilities slumped. The XLE is looking like its searching for the comfort of its 200 day SMA near the round 70 number and has dropped 5 of the last 7 weeks and by another 2.5% thus far. Yesterdays doji candle did little to help the weakness and the ETF is rapidly heading toward correction territory now 8% off most recent 52 week highs (keep in mind this is with crude holding steady so we are seeing a bit of divergence there). The earnings parade continues tonight with the most recognizable tech name reporting namely FB, SYMC and QRVO. Healthcare names are beginning to show some signs that they may be done going down and below is the chart of AMGN and how it appeared in our Monday 1/23 Game Plan (the XLV has made 3 higher lows recently on 11/3, 12/7 and 1/24). The stop in the trade was never hit and it bounced nicely off the very round 150 number on 1/24, and today recaptured its 200 day SMA for the second time this year. Perhaps it will be more comfortable staying above this time around.
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