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Europe Rebounds On Short-Covering, But U.S. Futures Ease Lower; Asia Closes Mixed

|Includes: Wells Fargo & Co. (WFC)

This morning. Since July 8, the market outlook is "uptrend under pressure", with 3 distributions in the past 4 sessions. Yesterday's panicked sell-off all happened in the session's first half hour, but quickly passed, and markets generally improved through mid-afternoon before easing again into the close.

This morning, U.S. equity futures are modestly lower and near the middle of their pre-market range. U.S. bank earnings commenced with a better than expected 2Q2014 earnings report from Wells Fargo & Company (NYSE:WFC), which beat on both adjusted earnings and revenues, but the stock is trading lower in pre-session trading. In Asia, equities closed mixed. In Europe, equities have rebounded, but are off their best session levels. The dollar is mixed. Equity weakness is mirrored in bond strength. The U.S. Treasury 10-year yields are lower. Commodities are mixed. Monday's Nikkei 225 September 2014 (NKU4) equity futures are modestly higher.

Thursday, on higher volume, major U.S. indexes distributed for the 3rd time in the past 4 sessions. The SPX, DJI, Nasdaq, and NYSE composite fell -0.41%, -0.42%, -0.52%, and -0.58%, respectively. This week, major indexes are down at least -0.90%, led by the Nasdaq, which is down -2.00%. Last week, the major indexes rose at least +1.19%. In July, indexes are mixed. In 2014, the SPX, DJI, Nasdaq, and NYSE composite are +6.29%, +2.04%, +5.26%, and +5.20% higher, respectively.

NYSE volume rose +14.9% to 0.90x its 20-day moving average.

Other notable indexes also fell. The DJ Transports (TRAN) fell -0.42%, and the Russell 2000 (RTY) fell -1.02%. The Nasdaq Internet (QNET) index declined -0.79%, and the Nasdaq Biotech (NBI) index fell -0.34%. The QNET is again in correction, down -10.4%, from recent highs, while the NBI closed -6.38% below its recent high.

Trading desks interpret that European rally as a low conviction rebound, driven by short covering and Portuguese reassurances, and note that bourses remain much lower on the week. In the U.S., 2Q2014 growth forecasts continue to be trimmed, now averaging 3%, down from 3.5% in June. Regarding yesterday's distribution, Portugal was the obvious trigger, but lackluster Asian and European economic reports suggest that world economic growth forecasts will need further trimming. Yellen testifies before Congress next week. The next FOMC meeting is July 29-30. The flow of earnings reports will increase next week. The equity bias appears higher, with expectations that gains will become more difficult, compared to the recent linear move higher. Conviction remains low.

The 2Q2014 earnings seasons began June 18th, and now 26 of 500 SPX companies have reported with respective +1.27% and +0.97% adjusted EPS and revenues surprises. In 1Q2014, 499 of 499 SPX companies reported with respective +5.91% EPS and +0.20% revenue surprises. Forward estimates moved up. Compared to March 28th, the June-end 2014 EPS estimate rose +1.16% to $118.55, from $117.20. Respective estimates for 2014, 2015 and 2016 are now $118.64, $132.34, and $146.54, respectively compared to $117.20, $130.50 and $144.96 at March-end, respective increases of +1.23%, +1.41% and +1.09%. Price earnings multiples remain elevated. With SPX equities trading at a 17.2x (compared to 17.3x the prior day) average 2014-15 earnings ($125.49), attention focuses on 2014-15 earnings and valuations (17.2x times survey 2014-15 SPX average operating earnings suggests a 2158.16 SPX level in the next year, a +9.85% rise from yesterday's close).

Technicals were little changed. Most SPX market segments closed lower. Market breadth was negative, and up volume lagged down volume. Volatility rose, but remains well below average historical levels. Treasury bond markets strengthened. On the day, the U.S. Treasury 10-year bond yield fell -1.44 bps to 2.5359%, compared to 2.5503% at the prior close.

This morning, 10-year U.S. Treasury yields are down -1.63 bps at 2.5196%, compared to the prior close. World sovereign bond markets are mixed. Spanish and Italian 10-year debt yields are 2.79% and +2.90%, respectively, compared to 2.83% and +2.95% the prior day.

U.S. options markets worsened to bearish to neutral, compared to neutral to bullish the prior day. The CBOE SKEW fell -1.01% to 134.43, compared to 135.80 the prior day, well above 130, a level that correlates well with short-term market tops. The SKEW closed at a record 143.60 on June 20th.

In pre-market futures trading, September SPX equity futures (SPM4) price near the bottom of their 1956-1964 trading range. After a fair value adjustment of +0.28 points, the SPU4 future prices at 1957.75, down -0.28 points. The SPX opens +0.27% and +2.04% above its respective 20- and 50-day moving averages, and +3.80% and +7.03% above its 200-day moving averages. Initial resistance is 1972.06. Initial support is 1955.08, then 1945.48.

"Uptrend Under Pressure" Market Outlook and Distribution Day Count. On July 9th, the market outlook worsened to "uptrend under pressure", as distribution day counts mounted. Since May 27th, distribution days number 6 for the SPX, DJI, and NYSE composite, and 5 for the Nasdaq.

On May 27th, the market outlook improved to "confirmed uptrend", ending a period of market "in correction" that began on April 4th. The SPX closed July 3rd at a record 1985.44, +9.35% above the 1815.69 close on April 11th, the recent low close. On February 3rd, the Nasdaq closed at its 3,996.96 year-to-date low, but then recovered +11.6% to the July 3rd 4,458.65 multi-year record close.

In Asia, equity markets closed mixed, with better strength in Shanghai. The Nikkei 225 (NYSEARCA:NKY) fell -0.34% and closed near its intraday low. The Hang Seng (HSI) Index fell -0.02%. The Shanghai SE composite (SHCOMP) rose +0.42%. The NKY, HSI, and SHCOMP 50-day moving averages are below their respective 200-day moving averages. Today's volumes are unavailable.

Economic reporting was light. Commentary focused on the week's regional equity weakness, the direction of monetary policy, currency, and commodity price developments.

This week, the NKY closed down -1.77%, the HSI fell -1.33% , and the SHCOMP lost -0.60%. Last week, the NKY closed rose +2.27%, the HSI gained +1.40%, and the SHCOMP gained +1.12%. In July, the NKY is up +0.01%, the HSI is up +0.18%, and the SHCOMP is down -0.07%. In June, the NKY gained +3.62%, the HSI gained +0.47%, and the SHCOMP gained +0.58%.

In 2014, the NKY is down -6.92%, the HSI is down -0.31%. The SHCOMP is down -3.26%. In 2013, the NKY rose +56.7%. The HSI closed up +2.87%. The SHCOMP closed down -6.75%.

In China, short-term interbank lending rates remain volatile, but the SHIBO 7-day rate was unchanged at 3.75%, compared to 3.75% the prior day, up from a 2.26% low on March 11th, but down from the February 7th 5.41% recent high.

Regional relative strength indexes (RSI) show Tokyo, Hong Kong, and Shanghai are in a neutral ranges. The NKY RSI fell to 50.44, compared to 52.92 the prior session, up from an oversold 27.92 on February 4th, the most recent prior yearly low. The HSI RSI rose to 51.55, compared to 51.74 the prior day. The SHCOMP's RSI rose to 50.16, compared to 46.40 the prior session. On June 27, 2013, the index's RSI fell to a low of 15.27, which was also last year's low index close.

In Japan, the NKY closed at 15,164.04, compared to 15,216.47 the prior day, -6.92% below its recent year-end 16,291.31 high and -61.0% below its late-1989 38,915.87 high close. The index gapped lower to open below 15,120 and set an early 15,101.49 intraday low, but much like its U.S. counterparts, quickly found support and rallied back to the mid-morning 15,204.01 intraday high. However, the index couldn't press the rally, which eased into the afternoon, then weakened further, with the index falling nearly to the morning's low. The index again found support and improved through the final two hours. Most market segments closed lower. Leaders were energy, consumer staples, and health care, which rose at least +0.24%. Laggards were financials, utilities, and consumer discretionary, which fell at least -0.76%.

In China, in Shanghai, the SHCOMP closed at 2,046.96, compared to 2,038.34 at the prior close, +4.97% above the 1,950.01 June 27, 2013 close, last year's low. The index opened narrowly lower, set an early 2,033.37 intraday low, but quickly reversed higher and traded to a 2,050 by late morning. The index set its mid-afternoon 2,051.58 intraday high, then eased in the final two hours. Most market segments closed higher. Leaders were industrials, telecommunications, and consumer discretionary, which rose at least +1.09%. Laggards included health care, which rose +0.12%, and financials and utilities, which fell at least -0.25%.

In Europe, equities are moderately higher, but off their best session levels, with greater strength in Milan and Madrid. The Euro Stoxx 50, FTSE 100, CAC 40, and DAX are up +0.53%, +0.28%, +0.56%, and +0.13%, respectively. The Spanish IBEX 35 is up +1.05%. The Italian FTSE MIB is up +1.35%.

Economic reporting is light. Commentary focuses on the conflicting analyses of the solvency of Portuguese commercial bank Espirito Santo and the capacity of Portuguese financial regulators to deal with any insolvency. The euro is weaker compared to the dollar.

European bourses have recently underperformed U.S. equity indexes. Intraday Euro Stoxx50 relative strength (RSI) is 38.09, compared to 34.56 at the prior close, in a neutral (30-70) range, better than its recent February 5th 33.57 closing low, which coincided with its 2014 low. The index's lowest recent RSI level was 25.77 on June 24, 2013, which marked the year's 2,494.54 closing low.

The Euro Stoxx50 trades -39.7% below its 5,249.55 March 31, 2000, all-time closing high. From its prior day 3,150.59 close, the index opened at 3,155 and quickly rebounded to 3,170, where it traded narrowly through mid-session. The 3,174.16 intraday high came in early afternoon. The index weakened below 3,160 in early afternoon, but current trades at 3,166.09. Most market segments are higher. Leaders are energy, utilities, and financials, which are up at least +0.87%. Laggards are consumer discretionary, which is up +0.02%, and materials and technology, which are down at least -0.04%.

This week, the Euro Stoxx50, FTSE 100, CAC 40, and DAX are down -1.85%, -1.01%, -2.48%, and -1.45%, respectively. Last week, the Euro Stoxx50, FTSE 100, CAC 40, and DAX closed down -2.26%, -0.99%, -2.30%, and -1.72%, respectively. In July, the Euro Stoxx50, FTSE 100, CAC 40, and DAX are down -1.86%, -0.80%, -2.17%, and -1.63%, respectively. In June, the Euro Stoxx50 closed up +0.03%, while the FTSE 100, CAC 40, and DAX closed down -0.88%, -1.53%, and -0.84%, respectively.

In 2014, the indexes are mixed. The Euro Stoxx50, CAC 40, and DAX are up +1.90%, +0.72%, and +1.26%, respectively, while the FTSE 100 is down -0.88%. In 2013, the indexes closed up +18.0%, +14.4%, +18.0%, and +25.5%, respectively.

2Q2014 SPX Earnings. The 2nd quarter earnings season began June 18th, and now 26 of 500 SPX reporting firms have reported, with respective +1.27% EPS and +0.97% revenue surprises.

In 1Q2014, of 499 (of 499) reporting companies, 370 or 74.5% surprised positively on earnings, with an average +5.91% surprise average. Of reporting companies, 263 or 53.0% reported sales or revenues above estimates. The average sales/revenue surprise was +0.20%. Energy led with respective +10.0% and -1.01% earnings and revenue surprises. Financials had a respective +5.67% and +0.26% earnings and revenue surprises. Consumer staples lagged with respective +0.34% and -0.66% earnings and revenue surprises.

Valuation. The SPX trades at 17.8x estimated 2013 earnings ($110.15), 16.6x estimated 2014 earnings ($118.64), 14.8x estimated 2015 earnings ($132.34), and 13.4x estimated 2016 earnings ($146.54). The 10-year average median price/earnings multiple is 15.9x. Analysts expect 2014, 2015, and 2016 earnings to grow +7.71%, +11.5%, and 10.7%, respectively.

The KBW Bank Index (BKX) trades at 13.7x 2013 adjusted EPS ($5.16), 13.3x estimated 2014 earnings ($5.32), 11.9x estimated 2015 earnings ($5.97), and 10.6x 2016 earnings ($6.66). Analysts expect 2014, 2015, 2016 EPS will grow +3.01%, +12.3%, and +11.6%, respectively.

Composite, index, and equity options. Options markets worsened to bearish to neutral, compared to neutral to bullish the prior session. Composite options are neutral, index options are neutral, and equity options are bearish. The composite put/call ratio is 1.06, compared to 0.84 the prior day, and worse than 5- and 10-period moving averages of 0.76 and 0.83, respectively. The index put/call ratio is 1.06, compared to 1.08 the prior day, and better than its 5- and 10-period moving averages of 1.13 and 1.14, respectively. The equity put/call ratio closed the day at 1.05, compared to 0.75 the prior day, and worse than its 5- and 10-period moving averages of 0.91 and 0.85, respectively.

NYSE Volume, Breadth Indicators. Volume rose +14.9% to 654.27 million shares, compared to 569.64 million shares the prior day, 0.90x the 723.73 million share 20-day moving average. Market breadth was negative, and up volume lagged down volume. Advancing stocks lagged by -1,206 (compared to +488 the prior day) or 0.44:1. Up volume was 0.38:1 down volume.

Libor, LOIS, Currencies, Treasuries, Commodities:

· USD LIBOR is 0.09390%, compared to 0.09400% the prior day. USD 3-month LIBOR is 0.23360%, unchanged from 0.23360% the prior day, and compares to the January 4, 2013, recent peak of 0.58250%.

· The US LIBOR-OIS (LOIS) spread is 13.960 bps, compared to 13.710 bps the prior day, and compares to the recent June 12, 2012, 46.785 bps high. Euribor-OIS is 14.400 bps, compared to 14.600 bps the prior day, and down from the December 27, 2011, high of 98.800 bps. Moves in the LOIS indicate changes in intra-bank lending risk premiums.

· The 3-month Euro basis swap curve is -11.667 bps, compared to -11.794 bps the prior day, up from a trough of -147.00 bps on December 14, 2011, and within a normal -10 bps and -40 bps range.

· German 10-year debt yields 1.20%, compared to 1.20% the prior day.

· French 10-year debt yields 1.43%, compared to 1.44% the prior day.

· Japanese 10-year debt yields are 0.54%, compared to 0.55% the prior day.

· Spanish and Italian 10-year debt yields are lower. Spanish 10-year debt yields are 2.79%, compared to 2.83% the prior day, modestly above the U.S. 10-year yield and compares to its 2.575% June 9th low. Italian 10-year debt yields are at 2.90%, compared to 2.95% the prior day and their June 9th 2.704% recent low. Spanish and Italian 10-year debt yields peaked at 7.62% and 7.26%, respectively, in July 2012 and November 2011.

· U.S. Treasury yields are higher, with 2- and 10-year maturities yielding 0.448% and 2.520%, respectively, compared to 0.454% and 2.536% Thursday. The yield curve narrowed -1.010 bps, with the 2- to 10-year spread at 2.072%, compared to 2.082% the prior day. In the past year, the 2- and 10-year spread varied from a low of +2.074% on July 11, 2014, to a high of +2.648% on December 31, 2013.

· The U.S. dollar is stronger compared to the euro, but weaker compared to the Japanese yen and British pound. The dollar trades at US$80.095, compared to US$80.029 intraday low and US$80.127 the prior day, and mixed compared to its $80.206 50-day, US$80.041 100-day, and US$80.261 200-day averages. The euro trades at US$1.3607, compared to a US$1.3595 intraday low and US$1.3609 the prior day. The euro trades worse compared to its US$1.3652 50-day and US$1.3732 100-day averages, and compares to a multi-year low of US$1.1877 on June 7, 2010. In Japan, the dollar trades at ¥101.31, compared to ¥101.34 the prior day. The yen trades better than its 50-day moving average ¥101.89, and better than its January 1st 105.31 closing low, its weakest prior multi-year closing low.

· Citigroup Economic Surprise Index improved to -12.60, compared to -14.00 the prior day. The index is mixed compared to its respective -12.22 5-day and -15.74 10-day moving averages. From a +72.70 high on January 15th, the index subsequently trended lower and turned negative on February 19th and fell to a -45.90 124-week low on April 7th. The index turned briefly positive in the latter half of May, but has been negative since May 29th. After a lag, the CESIUSD correlates with EPS revisions.

· Commodities prices are mixed, with mostly lower energy, higher precious metals, mixed aluminum and copper, and mostly higher agriculture prices.

Volatility, Skew:

· The CBOE SPX Volatility Index (VIX) rose to +8.07% to 12.59, compared to 11.65 at the prior close. The VIX is +9.23% above the 11.53 20-day moving average. Its 30-day high is 13.23. Its 30-day low is 10.28. Its all-time closing low is 9.31 on December 22, 1993. The long-term average is 20.00.

· The Euro Stoxx 50 volatility index (V2X) is 15.93, down -4.35% compared to 16.66 at the prior day's close. The V2X index trades +11.5% above its 14.30 20-day moving average, -11.3% below the 17.96 30-day high, and +29.5% above the 12.30 30-day low.

· The Hang Seng volatility index (VHSI) closed at 13.29, up +1.84% compared to 13.05 at the prior close. The VHSI index trades +5.63% above its 12.58 20-day moving average. Its lowest historical close was 11.72, on June 30, 2005.

· CBOE SKEW (SKEW) fell -1.01% to 134.43, compared to 135.80 the prior session, above a neutral reading (115-120) and since June 19th, above 130, a level that correlates well with short-term market tops. The recent record high was 143.26 on June 20, 2014. Its recent low was 112.47 on May 25, 2013. Spikes in excess of 130 correlate well with short-term market tops, as occurred last December, ahead of market declines last January. The index rarely falls below 110, last on July 31, 2009. The index correlates with market tail risks, the cost of buying out-of-the-money, long-dated options, i.e., options not affected by expirations. A rise suggests that investors are buying more puts than calls, a bearish signal.

U.S. Economic Reporting and News:
 

  • At 2:00, the June Federal budget statement, with +$79.0 billion survey.


Overseas Economic Reporting and News:
 

  • United Kingdom - May MoM construction output fell -1.1%, compared to +0.9% survey and +1.2% prior.


Company Ratings/News:
 

  • Wells Fargo & Company (WFC) - Reported 2Q2014 adjusted EPS of $1.010, compared to the $1.009 estimate, and $21.291 in revenues, compared to the $20.836 billion estimate.


Thursday's Trade. On greater and above average NYSE volume, major U.S. equity indexes distributed, closing down at least -0.41%, but well off early session lows. The SPX, DJI, Nasdaq, and NYSE composite fell -0.41%, -0.42%, -0.52%, and -0.58%, respectively. In July, indexes are mixed. The SPX, DJI, Nasdaq, and NYSE composite are at least +2.04% higher in 2014. Market breadth was negative, with gainers 0.44x losing stocks. Most SPX market segments closed lower. Leaders were telecommunications and utilities, which rose at least +0.61%, and health care, which fell at least -0.02%. Laggards were financials, consumer discretionary, and energy, which fell at least -0.62%.

Other notable indexes also distributed. The Russell 2000 (RTY) fell -1.02% and closed -3.87% below its March 4th record high. The Nasdaq Internet Index (QNET) fell -0.79% and returned to correction, down -10.4% below its March 6th closing high. The Nasdaq Biotech Index (NBI) fell -0.34%, -6.38% below its February 25th record high.

NYSE volume rose +14.9% to 654.27 million shares, compared to 569.54 million shares the prior day, 0.90x the 723.73 million share 20-day moving average volume. Bond markets strengthened. The U.S. 10-year yield trended lower to an 8:30 am low of 2.4926%, then moved higher to resistance at 2.54% late in the session. The index traded ended at 2.5359%, down -1.44 bps compared to the 2.5503% prior close.

From its prior day 1972.83 SPX close, September 2014 SPX futures (SPM4) suggested a sharply lower open. The index gapped lower to open at 1960 and fell to a 1952.86 intraday low before 10:00. The session's crisis passed quickly, however, found support and trended higher to the 1969.84 intraday high in mid-afternoon. The index closed at 1964.68, +82.8% above the 1074.77 October 4, 2011, intraday low, the bottom of the most recent correction.

From its prior day 8,244.75 close, the DJ Transportation index (TRAN) fell -0.23%, compared to the DJI's -0.42% loss. In early trading, the TRAN rose to its 8,154.33 intraday low, immediately found support and rallied through mid-afternoon, when it briefly reversed higher to the 8,258.43 intraday high. The index weakened again into the 8,225.80 close. Volume rose +8.01% to 13.940 million shares, compared to 12.906 million shares the prior session, and 0.99x the 15-day moving average volume. The TRAN closed +0.75% and +2.53% above its respective 20- and 50-day moving averages, and +5.99% and +10.7% above its respective 100- and 200-day moving averages.

Market volatility rose +8.07%, as the CBOE SPX volatility index (VIX) closed at 12.59, compared to 11.65 at the prior close. The index opened at the 13.23 intraday high, then trended lower to a mid-afternoon 12.05 intraday low. The VIX's all-time closing low is 9.31, on December 22, 1993. Its record high is 89.53 in December 2008. Its lifetime average is 20.01. The CBOE put/call SKEW fell -1.01%, to 134.43, compared to 135.80 the prior session, above a neutral 115-120 range, and well above 130, a level that correlates well with short-term market tops. Its record 143.26 high came on June 20th.

The market's technical factors were little changed. The SPX relative strength (RSI) fell to 56.69, compared to 61.64 the prior day, in a neutral range, down from an overbought 73.73 on June 9th and up from an oversold 31.24 on February 3rd. The RSI compares to an overbought 71.26 on December 31st, when the SPX closed at an earlier record high, and compares to earlier oversold levels of 35.14 on August 27th and 39.19 on October 9th.

This week, the SPX, DJI, Nasdaq, and NYSE composite are down -1.05%, -0.90%, -2.00%, and -1.47%, respectively. The prior week, the SPX, DJI, Nasdaq, and NYSE composite closed up +1.29%, +1.28%, +2.00%, and +1.19%, respectively. In July, the SPX and DJI are up +0.23% and +0.53%, respectively, while the Nasdaq and NYSE composite are down -0.27% and -0.35%. In June, the SPX, DJI, Nasdaq, and NYSE composite rose +1.91%, +0.65%, +3.90%, and +2.07%, respectively.

In 2014, the SPX, DJI, Nasdaq, and NYSE composite are up +6.29%, +2.04%, +5.26%, and +5.20%, respectively. In 2013, the SPX, DJI, Nasdaq, and NYSE composite closed up +29.6%, +26.5%, +38.2%, +23.2%, respectively. All closed at least +5.91% higher in 2012.

KBW Bank Index (BKX). On lower and below 15-day average volume, the BKX fell -0.74% to 70.83, compared to 71.36 at the prior day's close, its 25th consecutive close above 70, but -2.85% below its 72.91 March 20th post-2008 closing high. The index gapped lower and set an early 70.35 intraday low, but immediately steadied and trended higher to a mid-afternoon 71.05 intraday high, then eased to the close. Volume rose +21.1% to 39.711 million shares, compared to 32.793 million shares the prior day, and 0.89x the 44.387 million share 15-day moving average.

Large cap banks outperformed the regional banks, as the KBW regional banking index (KRX) fell -1.07%.

This week, the BKX is down -2.14%, compared to last week, when the BKX rose +2.36%. In July, the BKX is down -0.67%, compared to June, when the BKX rose +3.48%. In 2014, the BKX is up +2.27%, compared to the SPX's +6.29% gain. In 2013, the BKX rose +35.1%, better than the SPX's +29.6% rise.

The BKX is now +19.7% better than the June 24, 2013, 59.19 close, its worst since May 13, 2013. The index crossed above 50 on December 17, 2012, 60 on May 15, 2013, and 70 on January 8, 2014, but then dropped back below 70 on January 24th, which persisted until March 6th. On April 10th, the BKX fell below 70.00 and then eased consistently to the May 15th 66.81 closing low, its lowest close since early February. The BKX closed +117.5% above the 32.56 intraday low on October 4, 2011, the bottom of that year's correction. Large-cap bank stocks have outperformed the broader market's rebound, with the SPX up +82.8% in the same period.

The BKX index closed -41.5% below its February 20, 2007, record 121.06 high. The BKX is up +280.4% from its 18.62 March 6, 2009, closing low, its low during the 2008-09 financial panic.

Technical indicators worsened, as the index surrenders its 20-day moving average. The index closed -0.64% below and +1.57% above its respective 20- and 50-day moving averages, and +1.32% and +3.74% above its respective 100- and 200-day moving average. The 20-day moving average fell -1 bp to 71.29. The 69.73 50-day moving average rose +5 bps. Its 69.91 100-day moving average rose +2 bps, and the 200-day moving average rose +4 bps to 68.27. The 20-day closed (by +1.55 points) above the 50-day, and the gap narrowed -7 bps. The 50-day moving average closed (by +1.46 points) above the 200-day moving average, and the gap widened +1 bp. The 100-day moving average closed (by +1.63 points) above the 200-day moving average, and the gap narrowed -2 bps.

The directional movement indicator is -1.620, compared to +6.674 the prior day, its first negative reading since June 10th. Relative strength fell to 49.14, compared to 54.16 the prior day, in a neutral range, down from an overbought 73.14 on June 9th, but up from the recent 32.95 low on February 3rd. The lowest recent RSI level was 31.08 on November 14, 2012, which is also the date of the BKX's 2012 closing low. Next resistance is 71.14; next support is 70.44.

SPX, DJI, RTY, TRAN, CCMP, NYA, VIX, SKEW, NKY, EURUSD, USGG10YR, HSI, SHCOMP, SX5E, CAC, DAX, FTSE, JPY, GBP, EUR