March 28, 2024

Daily Wrap

Today was really not very noteworthy in terms of the market.  After gapping down on the open the market set its lows just before noon and spent the rest of the day drifting higher with the last 5 minutes of trading providing a push.  The idea of hedging or even taking home a small S&P short on Friday  would have worked well but I don’t know that there was conviction in any such trade.  The first test of a hard sloped 20 day was my conviction trade and it never manifested.

Stocks in the news today included Deckers Outdoor (DECK).  This name should be VERY familiar to anyone following the site and Stock Twits (WSConsensus).  This is a name I liked fundamentally and technically and it has played out very well.  I think this can definitely turn into a long term trade but I am also always hesitant to let gains go.  On the first push to $35 I noted maybe taking some off was prudent, this is now another push into that regio touching the 50 day MA.  If you hadn’t taken any off this would be another great opportunity.  I think longer term traders can use a stop at even while less risk adverse could use just below the 20 day MA.

Ebay (EBAY) was another stock in the news and being applauded as the market took it $2.39 or just under 5% setting new 52 week closing and intraday highs.  The why is a little less direct.  Technically EBAY was not bad but also wasn’t a name I was dying to own.  The leaks of strong Cyber Monday sales (couples with black friday turning into a cyber event as well) and the fact that EBAY owns PayPal and that was enough to pop.  I do believe as the rally started it was more the technical regions being broke that fueled the move.  I am not taking a position in EBAY but if I had it I would use this move to lighten up, utilize a stock replacement strategy or at least sell some Dec calls to bring in premium.  EBAY could drift  into year end if traders expect a strong holiday but up near $55-$56 I would then really start to get defensive.

A stock that should be in focus tomorrow because of news today is Dollar General (DG) which was reported after the close to be replacing CBE in the S&P 500 as of 11/30.  Congrats DG and below is a chart which after hours trading is hovering just beneath that trend line.  A consolidation and break could definitely provide an opportunity.

Lastly we had another takeover on a Monday, ah I miss 2006-2007.  Well it was technically a taking private of Zhongpin, Inc. (HOGS) which is a Chinese company in the Food industry.

From the Event’s Calendar for tomorrow:

8:30 am Core Durable Goods Orders; 8:30 am Durable Goods Orders; 8:30 am Fed Chairman Bernanke Speaks; Case-Shiller; 10:00 am Consumer Confidence; 10:00 Richmond Manufacturing Index

According to Briefing.com, the following noteworthy companies are scheduled to report earnings before tomorrow’s open: ADT, RAH

Back to the S&P.  The market moved strongly off the recent lows and really has not faced much resistance on the way up.  Today’s drop after Friday’s close at the 50% fib is the first down day since 11/15 and even that was a mere 2.86 points and off the lows.  The 50 Day MA is slightly higher (1425) and the 4 hour futures chart seems to be implying higher prices (for at least one more pop).  As far as the broad market is concerned.  I am on the side lines and instead I am focused on individual stocks that provide good risk reward since they have been working very well.

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