News:
Markets posted another day of gains on Wednesday as PPI revealed falling prices for producers.
- Month-over-month prices declined -0.3%
- Year-over-year price rose +1.3%, well below the Fed’s goals of 2%
Initially, the markets popped. But buyers gave way to selling pressure.
The Nasdaq and S&P 500 trended lower through Wednesday’s session but still closed with gains.
Gains were modest for all major indexes…
- Dow Jones +0.5%
- Nasdaq +0.1%
- S&P 500 +0.2%
- Russell 2000 +0.2%
Sector Round Up
9 of the 11 sectors posted gains on Wednesday.
At the top…
- Consumer Staples (XLP) +0.8%
- Financials (XLF) +0.6%
- Communications (XLC) +0.5%
The losers…
- Energy (XLE) -0.2%
- Utilities (XLU) +0.3%
Target Tops
Shares of Target (TGT) gained a whopping 18% after an earnings beat. The stock price and profits rose despite a decline in sales.
- The surge added $9 billion in market cap
- Despite the gains, TGT stock is still well below historical highs
- It’s down -12% year-to-date
- And -28% from 52-week highs
Technicals:
It’s official—The market is overbought.
RSI levels ended a second day in overbought territory.
History tells us a drawdown is near. But the extent is unclear.
You can tell from today’s chart the faster the overbought conditions are alleviated, the better odds the bulls have.
Your latest readout…
- The VIX is near 52-week lows
- RSI levels for the big three indexes are overbought
- The put-to-call ratio is neutral
Timing:
Two trading sessions remain before the November options expiration.
Next week, the market will head into an abridged trading week for the Thanksgiving holiday.
Watchlist:
*Low Float
^Open Position
*DRCT on watch
*SHOT support at $2
*MYO is on watch
*ACIC support at $9
TOI support at $2.20, resistance at $2.50
^WRAP support at 2.75, resistance at $3
RYTM support at $32, resistance at $34
ALKT support at $22
Seconard watchlist—float about 100 million
nmbNMRK support at $7.50
AFRM support at $24, resistance at $26
KD support at $17, resistance at $18