From the Trading Desk

Stocks Climb off the lows of the Session and Closed in the Green ahead of GOOG Earnings

The market was able to push higher despite disappointing news from existing home sales as well as data from the Richmond Fed manufacturing index. Existing home sales were expected to rise 1.2% but fell 1% and last month’s big number was revised from 5.9% to 4.8%. Richmond Fed manufacturing index fell to -12 while the market expected a reading of +5. Despite the disappointing economic headlines the market was able to push higher. Volume could not match Friday’s option expiry inflated figures. GOOG kicked off big tech earnings season with AAPL set to report tomorrow. The trend continues for stocks and until we have price action suggesting otherwise we’ll stay on this wave.

Key ETFs and their short term trends:

    TICKER ST TREND DATE CLOSE %

SPY UPTREND 1/22/2013 149.13 0.54%
IWM UPTREND 1/22/2013 89.21 0.72%
QQQ UPTREND 1/22/2013 67.18 0.16%
USO UPTREND 1/22/2013 35.01 0.69%
GLD UPTREND 1/22/2013 163.67 0.36%
SLV UPTREND 1/22/2013 31.12 1.01%
DBC UPTREND 1/22/2013 28.06 0.29%
FXY DOWNTREND 1/22/2013 110.49 1.48%
FXE UPTREND 1/22/2013 132.15 -0.03%
TLT DOWNTREND 1/22/2013 120.04 0.19%

IBM, GOOG, CREE, and ISRG catapulted higher in the after-hour session as Traders cheered their earnings report. TXN did not fare well as the stock is currently lower by 72bps, but completely overshadowed by other reports. The QQQs were trading 45 basis points higher while SPYs were trading 9 basis points higher. GOOG has yet to trigger a buy signal, but if it can break above its pivot would be a breakout candidate. Given the earnings and volume following earnings releases volume should be well above average tomorrow.

Last night in our Gold forums we posted regarding the sentiment situation. Sentiment across the board is bullish, but not at extremes just yet. Perhaps with today’s move we’ll see a change in sentiment, but for now we aren’t at extremes. On the other hand, the number of stocks above their 50 day moving average is at highs suggesting there is a higher probability we’ll see stocks take a breather, after all the Dow is up 8 days out of 9 and the S&P 500 up 5 days in a row. Know one knows when this party will end or if it will ever end, but we have our exit plan and when we get our exit signals we’ll take them. There have been very few stocks showing sell signals suggesting we can go higher.

Commodities continue to be very interesting with USO and DBC inching higher. Crude oil ended the day with a 96 handle and is poised to continue its recent uptrend. No doubt will higher crude prices continue to put upward pressure on prices. The endless QE the Federal Reserve has embarked on will likely impact prices of every day goods and services. Pain at the pump will soon rise as a concern again, but for now prices are headed higher.

Have a great week.

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