Stock Market Early Morning Insights – August 18, 2016

Stock Market Early Morning Insights – August 18, 2016

We had a good session on growth stocks yesterday at the HGSI Insider Club Webinar. If you are interested in seeing my approaches to locating growth stocks, this is the link to the blog post video:

With little hope of a Fed rate increase this year, the dollar fell, oil futures continued higher, bonds rallied, and utility stocks had a strong turnaround day. The Dow Jones Utility Average was up 1.6% with all 15 stocks positive for the day, and utilities sector had 4.32 advancers for every decliner. This was a sharp turnaround for a group that had fallen around 7% since the beginning of July.

The E-mini futures spent most of the day in solidly negative territory, but by the end of the day had rallied back into positive territory. The NASDAQ composite closed flat for the day, but at 95.65% of its daily range, so absorption of supply was evident by the time the market closed.

Internals were slightly negative, around 1.42 to 1. With oil on the rise again, the dominant group in the stocks and groups moving to the upside were the Exploration and Production stocks. Internet Media, Semiconductor Devices, and E-Commerce Discretionary groups did well also. In the $1 to $15 SmartGroup, Communications Equipment stocks stood out again. All of these groups were represented in the top 50 group inclusion report.

Yesterday’s intraday turnaround was not a huge surprise because there is a lot of support under this market. When the bulls are in control, they do not give up their gains easily. Institutions have the cash, and a steady influx of money coming in has to be put to work somewhere.

Even though there was an intraday hiccup after the Fed minutes were released, the bulls started buying futures around 11:15 AM central time to dash any hopes the bears had of taking this market down. The S&P E-mini’s bounced off of the 20 -day exponential moving average to signal that the uptrend was still intact.

Stock index futures are slightly negative as I am writing this, and oil is up another .44% as the Dollar Index continues to fall. It is currently down .26% for the day.

The trends remain up and there are still plenty of risk on groups showing strength.


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