With AAPL leading the way, the bulls once again successfully defended vital price support levels on Friday with a remarkable surge of buying at the end of day Friday. With a rise of 10.47%, APPL became the most valuable company in the world, and single handly was responsible for the majority of the rally. The bullish pressure continues this morning with APPL indicated to gap up at the open.
Asian markets were mixed but mostly higher overnight as China’s July manufacturing data come in above expectations. European indexes trade bullishly across the board this morning and US Futures that traded flat most of the night have gone bullish this morning with new record highs likely in the QQQ at the open. A busy economic and earnings calendar will likely keep volatility elevated in the week ahead, so remain focused on price action and remain flexible.
Economic Calendar
Earnings Calendar
Our biggest week of earnings reports for the 3rd quarter is now behind us, but we still have a busy week with 146 companies reporting this Monday. Notable reports include AIG, AWR, CRUS, CLX, CTB, ESS, IR, J, LEG, L, MCK, MOS, NNN, O, RNG, SBAC, TTWO, THC, TXRH, TSN, VVV, SPCE, VNO,& WMB.
News and Technical’s
Saturday negotiations on the stimulus bill ended in a deadlock with the unemployment bonus remaining as the major sticking point. The $600 per week additional payment ended last Friday as the two sides duke it out with sound bites and rhetoric in the weekend news that will spill over into this week’s price action. As pandemic infections spread widely across the country, Lord & Taylor, the owner of Men’s Wearhouse files for bankruptcy. A theme that’s become all too familiar in recent months and sadly a reality that could easily continue through the rest of the year. Last week the President threatened to ban the popular social media app TikTok but has since backed off the notion after MSFT announced it is in discussions to buy the company in a deal they hope to complete by Sept. 15th. A move that would, for the first time, put MSFT in direct competition with FB and TWTR.
With a strong afternoon rebound, the bulls once again defend critical moving average support in the DIA mostly on the bullishness of AAPL. Not only did the price of the stock soar 10.47% on Friday, but it also became the most valuable company in the world. Pre-market activity indicates the rush to buy MSFT is not over with the stock indicated to gap up again at the open today. Although the US Futures were relatively flat overnight, they have started the morning push that is likely to set new all-time high records in the QQQ. Interestingly the Absolute Breadth Indicator continues to decline, which indicates fewer and fewer companies are responsible for the current rally. Expect another wild week of price action, especially if we begin to see any profit-taking in the big tech stocks.
Trade Wisely,
Doug
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