Small-Caps Clear 50-Day MA 01-16-19

U.S. markets showed strength for the 2nd-straight session following better-than-expected earnings from the Financial sector that will be in focus throughout the week. The gains helped the major indexes edge closer to near-term resistance levels with the 50-day moving averages in play.

The continued January rebound rally continues to look bullish with the major indexes also showing signs of breaking out of a 5-day trading range. Volatility continues to fall and has helped support the market”s strength but still faces major support levels that need to be cleared and held.

The Russell 2000 advanced 0.7% following the morning run to 1,460. Lower resistance at 1,450-1,465 and the 50-day moving average was cleared and held with a move above the latter getting 1,475-1,480 in play.

The Dow added 0.6% following the late day test to 24,288 and 2nd-straight close above 24,000. Fresh and lower resistance at 24,250-24,500 was cleared and held on the close below the 50-day moving.

The S&P 500 climbed 0.2% after trading to a session high of 2,625 while closing above the 2,600 level for the 2nd-straight session. Lower resistance at 2,625-2,650 and the 50-day moving average held with a close above the latter signaling additional strength.

The Nasdaq was also up 0.2% following the opening push to 7,079. Fresh and lower resistance 7,100-7,150 held with the index holding the 50-day moving average for the 2nd-straight session.

Financials led sector strength after zooming 2.1%. Real Estate and Materials rose 0.5% and 0.4%, respectively.

Consumer Staples paced sector laggards after falling 0.5% while Communications Services was down 0.4%.

MetLife (MET) upgraded to Buy from Neutral at BofA/Merrill
ING Group (ING) upgraded to Buy from Hold at Societe Generale
Williams (WMB) upgraded to Overweight from Equal Weight at Barclays

AB InBev (BUD) downgraded to Underperform from Hold at Jefferies
Citi (C) downgraded to Hold from Buy at Standpoint Research
Snap (SNAP) downgraded to Sector Perform from Outperform at RBC Capital

Thursday Before the Open (EST):
​Bank of America (BAC), Bank of New York Mellon (BK), BlackRock (BLK), Comerica (CMA), Goldman Sachs (GS), U.S. Bancorp (USB)

Thursday After the Close (EST): ​American Express (AXP), Bright Scholar Education (BEDU), Independent Bank (INDB), J.B. Hunt Transport Services (JBHT), Netflix (NFLXWealth Strength IndexNFLX is Extremely Down and trending Down), Preferred Bank (PFBC), Progress Software (PRGS)

Thursday’s Economic Reports (EST):
Jobless Claims – 8:30am
Housing Starts – 8:30am
Philadelphia Fed Business Outlook Survey – 8:30am


Gold closed at $1,293.80 an ounce, up $5.40
Silver settled at $15.64 an ounce, up $0.02
Copper finished at $2.67 a pound, up $0.04
Crude Oil is at $52.35 a barrel, up $0.25
Bitcoin Investment Trust (GBTC) ended at $4.24,
up $0.03

I hope this helps you prepare for the trading day. Make it a great one!
Todd Mitchell