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It looks like the S&P 500 is giving us two inside days in a row. An “inside day” is a technical analysis term that refers to a day in which the total high - low price range is within the bounds of the previous day’s high - low price range. After Tuesday’s drop, Wednesday saw a rally back, with its lows higher than Tuesday’s low, and its high lower than Tuesday’s high. And today, the low is higher than Tuesday’s low, and the high is lower than Tuesday’s high. An inside day is interpreted by some traders as a time when there is uncertainty in the market (no kidding) and a change in trend might be happening. So, if you put any stock in that (no pun intended) you might think that the down trend we’ve seen since early January might be over.
Today’s market was weighed down by disappointing earnings by MSFT and FITB, as well as a surge in jobless claims and another record low in housing starts. But contest favorite AAPL gapped higher on the open continuing yesterday’s rally. Strong first quarter earnings fueled by the sale of 23 million iPods pushed the stock nearly 7% higher today. Some of the contest leaders had put some big positions on in stocks ahead of earnings, including KEY, MTB, BBT, FITB, HBAN, and AMR, as well as some of the inverse ETFs. The stocks had some big moves today, so we’ll see if there was a shakeout in the leader board.
Tom Preston
thinkorswim, Inc.
Member FINRA/SIPC/NFA
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