Because they can…
On Friday, the SPX was fueled by trade deal hopes as tech and industrials helped the index brush up against all-time highs despite a mixed to tepid earnings guidance picture. Process preempted premise. ES is well and truly above the recent balance area and that is impressive for a Friday and shows the Aussie large cap action and financial press were both quite prescient going into the weekend.
NYSE internals have stayed above neutral but were not crazy strong with A-D lines at +463 and NYSE breadth at +1.7:1. NASD breadth: +2.04:1.
Overnight, the ES session was packed and well balanced - note the opening print represented by a green dot in the middle of the D shaped profile - but ended on a low note as the SPX opened at 3003.32. Soon after the cash open a short-covering session ensued. The regular hours session has some double prints on the way up the stem but before some back and fill it is the shape of a surprise rally. Needless to say AMZN and QQQ regained much of their overnight losses early in the session. INTC offered positive guidance and the semiconductors got a boost. Heck, even some names that offered weaker guidance like CAT are up today. The trade warriors are still touting progress toward a phase one trade deal, but many experienced participants will tell you that this playground of ideas is courtesy of the Fed. Keep your eye on the fine print when the FOMC meets in the coming week.
Here are some charts in progress with a half hour to go until the weeks closing action
