Monday, March 22, 2010

State of the Market - 3/22/10

We saw an up day today on Wall Street, although it didn't start out that way. Futures were lower pre-market and stocks did open lower, but that was the low for the day. The market climbed steadily higher from there, particularly on the Nasdaq, which bounced almost 40 points off its lows by the end of the session. Most of the gains took place during the first hour, and from there it was just a slow climb slightly higher. The market did finish with good gains, but slightly off its highs. Volume was lower than Friday but a better comparison would be the other days from last week - in that respect, it looks to be about the same (maybe slightly lower).

Technically, the market just remains in a very tight, very steep rising channel and doesn't seem to want to get out of it. A break of today's lows would signal a steeper pullback, but right now I don't know if we'll see those lows broken or not. The divergences remain but I guess they don't matter. Sector-action was bullish across the board, with commodities looking like they may bounce further from here after some weak action three or four days ago.

In terms of individual stocks, the trend continued today of not seeing much action here even though the overall market went up. I didn't show too many setups this weekend because I didn't see too many, but from my quoteboard today, the only stocks that moved at all were HAR and TIVO. That was it. I continue to think this is odd but don't know what more to make of it.

As I go through my scans right now, I do see a lot more potential setups than I saw last night. Perhaps it was the gap low and reversal that made more stocks look attractive. So I will go into tomorrow with a watchlist for potential longs just like I have for most of the past two weeks. I am just hopeful some of them will trigger with volume and actually do something rather than just sit there with no follow-through as so many have the past two weeks.

Here are the names that I will be watching - SONC, FBN, VNDA, FTEK, BID, CISG, MEA, EVOL, HVT, MEND, MCCC, JAG, CHINA, CRUS, VOLC, CWTR, STV, CNW, DEER, STC, CAAS

Let's see if we can get some follow-through tomorrow on today's move - not just for the overall market but in individual stocks as well. We are not really overbought anymore so the potential to move higher is there, even if it doesn't make sense. Good luck Tuesday.

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