Cycle highs...

Seemingly, consolidation ahead of Bernanke lasted all of 1 day as a slew  of EPS beats/guide ups from Industrial, Materials in the pre-mkt caused some caution to come off and turn into PA (performance Anxiety) for month end.  After this morning’s results, all you are hearing is how ‘80%’ of SP is topping street estimates.  Today and tomorrow is the peak of earnings, so the 16 of 20 is growing and growing.  ..”… if 16 out of 20 surprise positively, we’ll probably see 80 out of a 100 accomplish this and so on and on it goes”… Into the trading week, earnings can keep the momentum going” (this weekend).   Importantly, trends for all sectors are pretty well known now as nearly 50% of SP has reported.  That’s enough to make investment decisions unless you think the ‘Utilities’ group (only 1/33 reported) is indicative of further global recovery or not. Included or rather not included in the move higher today was some rotation/ profit taking on the morning pop on recent winners/ high beta stocks as per follow-up today. In all, somewhat of a messy tape, but one that may bring inflows from the sidelines due to technical (indicies potential breakout) + earnings momentum in multi-nationals/industrials paving the way....”.It’s always something that supposedly keeps real buying on the sidelines before realization hits and PA (performance anxiety chase) ensues”.   Today's action might be enough as many investors/managers look for this criteria to put money to work. It looked like some cash was finally being laid out.  Days where high beta, high flyers provoke a breakout day have been far removed from the markets the past few years as they usually do their damage up to the breakout levels and some other group initiates the breakout. This why we haven’t seen a huge breakout day in months/year as it’s been a gradual and consistent bull market.

This weekend we alluded to the upcoming ‘hype’, now that we’re all at nauseating levels 48hours into the week,  the Bernanke Show is almost here.  Hopefully, it ends as a ‘non-event’ and earnings carry the momentum.

Update on Wednesday, April 27, 2011 at 09:28AM by Demi/ YourPersonalTrader

Hype is too funny. Seems expectation is as if Bernanke will answer, if he wears Boxers or Briefs?. Every answer will be 'commitee' based.

..may they all be like CRR, FTNT,SFLY,N!

A day of digestion as the market rests on support provided by a ‘positive’ earnings season and a FED that gives and gives.  Most of the incremental gains for the market today are due to managers going after the lagging groups  as is always the case.  Thus, leading sectors in the market today are the Black Sheep groups, while the Nasdaq lags.   This also relates to a note a few days ago…”.bring inflows from the sidelines due to technical (indicies potential breakout)..” . Combined, it is all ‘PA’, performance anxiety into month end.  If the breakout the other day isn’t enough, today the TRANS were making fresh highs, which garners support from the Dow Theory cult. 

Another quiet day tomorrow likely, next week as discussed we will find how long the market can rest on it’s laurels. (earnings / FED).  There is no sign of shorts in the market and it’s hard for the market to go much higher without them being around to get squeezed.  The market would need a lot of money to come in the market to offset their absence.  Maybe, eco data will wake them up next week and/or wake up complacent longs.  Recall, what we said about April PMI's (tagged) showing what March PMI's didn't ( post Japan/Crude price escalation). 

Considering, DJIM has always been an earnings/small cap orientated place,  we still have something to look for as R2K earnings take over from the mega caps.  If today is any indication from Shadowlist (tagged to locate) earning linked plays, we’ll have something to look forward to and initiate new stocks. CRR, initiated last Q at $110, hit $169 today, SFLY, also last Q addition at $40 to $67 today and FTNT  from August at $18 to $48.  All were  >15% pops today off another round of excellent earnings. Makes you wish you were just a buy and hold investor....

Update on Friday, April 29, 2011 at 02:36PM by Demi/ YourPersonalTrader

Nice earnings from small caps, QLIK  play here and others like ACOM (now at of hand), ARBA , but one we played as an IPO in software Netsuite is best, N, headline is nothing # special, but inside is great 'billings growth') and definitely an add to Shadowlist.