Markets put up another decent showing although the gains were a bit muted compared to Monday-Tuesday. The Dow was slightly negative courtesy of IBM dropping 7.5%, but the Nasdaq, S&P 500 and Russell 2000 all advanced between .1-.2%. The Nasdaq is following through nicely already ahead by 2.7%, following last weeks 2.8% jump. The S&P 500 is higher by 2% so far this week and the Dow by 1.6%. If this holds into the weekend, bulls can sleep a little easier as it would be the second week in a row the Nasdaq has outshined its rivals. True to form gains are being traditionally had in the second half of April, h/t Stock Traders Almanac. One could make the case for a cup base pattern taking shape on the Nasdaq, but it needs more time and it is taking on somewhat of a V shape. The VIX put in an inverted hammer candle today ending a 5 day losing streak and it is back to retesting the cup base trigger of 15 for a second time in as many months. If its breaks through its 200 day SMA, it would be a break below a bearish descending triangle, that commenced with a precise move to the very round 50 number on 2/6.
Looking at individual groups Wednesday there was some clear bifurcation, unlike the first two days of the week where the vast majority of the major S&P sectors were higher. Today it was the energy space solidifying the notion of trends in motion tend to stay that way as the XLE rose by 1.6%, with the second best actor, the industrials up by 1%. Sectors that were lower today included technology, utilities, financials and the staples lagged with the XLP off by .8%. I would not be surprised if the markets weaken will we hear a lot of talk mentioning “it is hard for the benchmarks to move higher without participation from the financials”. The XLF has now CLOSED in the lower half of its daily range 8 of the last 10 sessions, and the two days that did not on 4/10 and 4/12, were in the upper half by the slimmest of margins. The materials are one to watch as the XLB has risen 9 of the last 12 sessions and is stalking out a double bottom trigger of 61.84 in the near term. Keep an eye on FCX with earnings coming up shortly as it does battle with the very round 20 number, which it could not record a CLOSE above that figure although it was above intraday five times this January.
In this paragraph yesterday we spoke about the affinity investors have for the device makers in the healthcare arena. Today we take a look at a best of breed pharmaceutical play in SUPN. As there has been some real laggards in the space including ALKS, BMY and AGN, all of which were prior leaders in the past (AGN is 36% off its most recent 52 week highs, ALKS by 34% and BMY by 25%), today we look at a general in the sector. Below is how we profiled the name in our Wednesday 4/11 Game Plan. The stock backed off from highs during Tuesdays session but it still trades near a cup with handle breakout trigger of 47.10. It trades just 4% off most recent 52 week highs and traders should be looking to add to this name through the very round 50 number which coincides with a cup base pivot of 50.15. That would register an all time high and it has positive returns for the one week, one month, three month, one year and YTD time periods.