MyHappyTrading's  Instablog

Techs have been leading the market on this pullback, with AAPL and AMZN leading the way. But, the broader market has been holding up... until today. Last night, CMI reduced its full-year forecast, sending its stock down 3.36%. Today, CVX also sang a song of similar tune, stating that its quarterly profit will be substantially lower. CVX fell 4.18%.

On the upside, YUM and COST both popped higher after delivering strong quarterly reports. YUM was up +8% and COST gained +1.92%. WMT recorded a new all-time high, finishing up +1.73% TRLG stoked retail stocks, as it jumped more than +22% on news of the company exploring possibility of being acquired. RL, LULU, ROST all finished in the green in a down market.

The Dow was down 128.56 points; SPX lost 8.92 points; Nasdaq fell 13.24 points:

XLE (energy) fell 1.87%, while OIH (oil services) lost 1.41%. SOXX (semiconductors) continued to sink lower, down 1.36%. SLV (silver) and GLD (gold) were flat.

SPX

SPX lost 8.92 points to close at 1432.56. It closed below its daily MAs. The MACD went down.

Nasdaq

Nasdaq fell 13.24 points to close at 3051.78. Its daily MAs turned down and the MACD went lower.

Both SPX and Nasdaq have moved below their respective daily MAs, and the market tone is turning weak. It does look like this pullback is not done. SPX has support at 1420. Coal stocks were strong to start the week, offsetting the selling in techs. But, the warnings from CMI and CVX, in addition to AA's disappointing forecast, put a halt to the coal stocks' bounce. Energies sank on CVX's warning and the selling pressure just piled onto the broader market. Financials, however, held up really well, ahead of JPM and WFC's earnings on Friday.

Right now, we're in a stock-picking environment, with a slight, bearish bias on the market. Strong pops are still seen on good earnings reports, while early warnings have darkened the market's mood. We'll likely see a mixed market tomorrow, as some stocks have pulled back quite a bit in the past few days and other stocks are just starting to roll over.

The market is at a critical point right now, and we'll have to see if the financials can hold (or extend) their bullish stance after JPM and WFC's reports on Friday.

Good night and HappyTrading! ™

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