Stock Market Early Morning Insights – June 30, 2016

Stock Market Early Morning Insights – June 30, 2016

Not surprisingly, yesterday was another strong day up after the reversal day on Tuesday. Admittedly, I was surprised at the buying pressure throughout the day, but those who were short had to cover, which only fueled the buying frenzy.

During the past five trading days, the broader markets have been heavily manipulated by news. There is no reason for the tremendous selling that occurred on Friday, in spite of the Brexit referendum. Did the world change enough to justify the kind of reaction that we saw? No, and this is being proven by the fact that big-money forces within the markets stepped in to scoop up discounted shares by those who panicked and sold because of fear of the unknown. This is a cycle that repeats itself over and over.

Are conditions better in Europe than they were on Friday? No, they are actually worse because of the turmoil in the British Parliament, and the remorse by some Brits who voted to exit the EU, but felt that they were misled, or even lied to. Yet, stocks have seen a tremendous two-day rally fueled by short covering and greed. These are obviously not normal market conditions, and it takes a very strong stomach, and great skill to be an intraday trader. I am not inclined toward that type of trading because of the emotional toll, and time commitment that it takes.

Much of the buying pressure yesterday came from beaten-down groups such as Banking and Biotech stocks. The number three Woodward and Brown folder, the SPDR ETF Sectors folder is a good snapshot of what happened in the market yesterday. The rally was broad-based with advancers leading decliners by a 3.89 to 1 margin in the NASDAQ. Volume was heavy again for the NASDAQ, and another Eureka was generated. The SPDR Sectors were led by Biotech’s and banks, and there are several ETF’s that were up over 2%. The Oil Exploration and Production stocks had another strong day with oil up sharply. Volume was less than average for the S&P 400 mid-cap’s and the S&P 600 small-cap’s. This was somewhat of a surprise because of the above average volume in the NASDAQ Composite.

Stock index futures were up earlier this morning, but they have since turned negative. Oil futures are currently down 1.90%, and bonds and gold are also down. Once again, REITs and Precious Metals and Mining stocks were the dominant groups in the Top 50 GIR.

Volume should begin to subside as we head toward the long 4th of July Weekend. Just because we have had a two-day rally does not mean it will continue. I would like to see backing and filling, and some low volume tests for supply to be convinced that indexes are going higher.

I mentioned AMPH yesterday. It began the day well, but an analyst came out with a market perform and a $17 price target, and it sold off, but volume was light. Keep it in your watch list.

I will begin my webinar series in July, probably during the second week. I am going to do a series of webinars about 20 minutes after the market closes over several days, and multiple weeks. All sessions will be recorded, and you will be able to download the videos to your computer. These webinars are exclusively about HGSI Investor software, and how to get the most out of it in conjunction with your trading platform. I will not be discussing other software. If you want to learn HGSI, and about my new techniques using VPA, VPOC, and trend and impulse trading for intermediate and long term traders, you should attend. As a subscriber to this report, your cost will be $495, and you can do this in the comfort of your home, at your own pace, no travel expenses or hassles There will be plenty of time for questions and answers.

I plan to get a video out today or tomorrow to show you what I intend to cover. This will not be about short-term trading and intraday trading where you have to be glued to your monitor. I will be emphasizing risk control, position sizing, and low risk entries based upon trigger points. The discussions will be leisurely and in depth. I will explain this in the video to come either later today, or tomorrow.

I have a list of those of you who have indicated that you wish to attend. You do not need to contact me again. I will send an email with times, dates, and payment information when I am ready to go.


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