The talk yesterday was all about Facebook (FB). Their forward guidance was poor and the stock was hammered after hours on Wednesday. It ended on Thursday at 176.26, down 18.9%. This hurt the NDX and many other indices that have large positions in the stock.
Naturally, the NDX was the weakest performer of the big three on Thursday. The Dow Jones Industrial Average (DJIA) did much better, however, and had modest gain to the upside. Good earnings in 3m (MMM), CAT and Boeing (BA) propelled the DJIA to a modest gain on the day. The S&P 500 (SPX) had a small loss, as FB helped to keep it down. The 10YR ended the day at 2.98%.
At the close on Thursday, the DJIA was up 0.44%, the SPX was down 0.3%, and the NDX fell 1.4%. Breadth was positive, 1.5 to 1, on above average volume. ROC(10)’s were mixed, with the DJIA advancing and the SPX and NDX declining. RSI’s were also mixed, with the DJIA rising to 68.6 and now the leader. The NDX was down to 59.4 and the SPX fell to 66.2. All three MACD’s remain above signal. The ARMS index ended the day at 1.08, a neutral reading at the close.
The NDX was the big mover as noted above and fell to close at 7400. It ended the day developing a “Doji”. The other FANG stocks and Semi’s had a fairly good day and managed to keep the NDX from a large loss. It remains well above its 20D-SMA of 7278. The DJIA had the best session closing at 25527. It saw its 20D-SMA(24842) cross back above its 50D-SMA of 24818. It holds above its 50% retrace level of 25074.
The SPX closed at 2837, and traded as high as 2845. It remains within striking distance of its record closing high of 2872. It continues comfortably above its 20D-SMA of 2783. The VIX fell 1.2% to 12.14. Volatility remains relatively low.
Near term support for the NDX is at 7350 and 7300. Near term resistance is at 7450 and 7475. Near term support for the SPX is at 2825 and 2812. Near term critical resistance is at 2850 and 2862.
Europe is higher in early trade Friday, and U.S. Futures are higher in the premarket as well. Major economic reports on tap today include GDP at 8:30am and Consumer Sentiment at 10:00am.
The SPDR Dow Jones Industrial Average ETF (DIA) rose $0.48 (+0.19%) in premarket trading Friday. Year-to-date, DIA has gained 3.99%, versus a 6.60% rise in the benchmark S&P 500 index during the same period.
Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, David Chojnacki, does not endorse or recommend any issuer or security mentioned herein.
Dave Chojnacki is the Chief Market Technician at StreetOne Technical Analysis. In addition, he is Portfolio Manager for Sabretooth Advisors.
Dave develops a morning newsletter providing clients a daily look at market technicals of the major indices and selected ETF’s. Market trends, support and resistance levels are provided in the daily letter. The Technical portion of the daily can also be found on Seeking Alpha. Mr. Chojnacki has been quoted in a number of industry publications including the Reuters, ETF Trends, Minyanville, Yahoo Financial and Investors.Com.
Prior to joining StreetOne Technical Analysis, Dave designed and developed I/T Systems for the Insurance and Financial Industries.