From the Trading Desk

AAPL Weak Again; Weights on NASDAQ 100

A sneaky day of distribution for the S&P 500 as volume on the NYSE rose the day after the latest Federal Reserve Open Market Committee meeting. Leading decliners was the NASDAQ 100 as AAPL had its 4th down day in a row weighing on the NASDAQ 100 and NASDAQ Composite indexes. NASDAQ narrowly misses a distribution day with volume edging 3% lower. VIX remains under 10 as this market is not anticipating any volatility over the next few weeks.

On a positive note, the Dow Jones Industrial Average finished the day higher. Small caps inched lower, but holding near July highs. We are now on the back stretch of September and the 3rd quarter. Seasonality trends are still headwinds, but so far have not proved strong enough to knock this market down. We’ll continue chugging along until we get signals to get off the trend. No need to be a hero in this market.

Sentiment continues to be with the bulls this week. AAII Bulls crept lower by 1%, but remain above 40%. Those who were neutral fell as Bears jumped to 27% on the week. NAAIM exposure index still shows active managers exposed to the long side of the market. We did see some bearish bets placed for the first time in months. Not to say we are in imminent danger, but interesting we have a higher level than “normal” bullish sentiment.

It would be great if we had some sort of orderly pullback. A quick correction to help level set this market and introduce a bit more volatility into the fray. We continue to see a lack of volatility and whether it is complacency or not we just are not seeing huge swings. Most will make the immediate jump we are about to crash, but for now this market has pushed higher no matter what the pundits have and continue to say. At some point, we’ll get some sort of bear market. Until then why not just enjoy the ride higher? We prefer to let others deal with the noise. Operating since 2007 we have seen quite a bit and continue to exist today because we have ignored the noise.

AAPL is still a bit of concern now, but like we have seen in the past this market can shake things off like this. AMZN still is on shaky ground as well as GOOGL. Keep an eye on these stocks as they do influence the NASDAQ quite a bit.

We hope you have a great weekend. Get out and enjoy the fall weather.

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