Jump to content



Photo

Nick's Picks Daily Update 4/28/04


  • Please log in to reply
No replies to this topic

#1 TTHQ Staff

TTHQ Staff

    www.TTHQ.com

  • Admin
  • 8,597 posts

Posted 29 April 2004 - 08:15 AM

THE NICK'S PICKS DAILY UPDATE A Decision Point Publication By TraderNick As of market close 4/28/04 With no economic news today the market was left all alone with its fears, and succumbed to them. Investors could see no reason to buy, but plenty of reasons to sell, from escalating Mideast violence to the continuing obsession with the Fed and the prospect of higher inflation and higher interest rates. The Nasdaq fell back below the 2000 level, market breadth was ugly, and all three major market indexes gave ST indicator crossover sell signals, from stochastics to DMI to MACD. The unknown and unseen are always more frightening than the known and seen, and what really seemed to be bothering traders was the prospect of upcoming economic developments. Tomorrow we get the early estimate of Q1 GDP (Gross Domestic Product). Next Tuesday the FOMC (Federal Open Market Committee) meets to ponder interest rates. And the following Friday we get the April monthly employment report. I can tell you what will most likely be reported in each of these instances: (1) Q1 GDP will probably come in right around the estimated 5% growth rate or higher. Too high and traders will be spooked that the Fed will raise interest rates earlier than it wants to. Too low and they'll worry that the economy is slowing too soon. (2) The Fed will not move on interest rates at its May 4 meeting. It will modify its policy language to a tightening bias. (3) The April jobs number will come in weaker than expected, and weaker than the strong March report. The market, wherever it is at the time, should rally off of this, figuring that it gives the Fed has more time before it has to raise rates. What I can't tell you is how the market is going to react to each these developments, except in the case of No. 3. All this said, we're still in the trading range, only now we're working from the top of it back toward the bottom. Daily TRIN closed above the 2.0 mark today, a bullish indicator. Normally, I'd call for a bounce tomorrow on the basis of this, but it's really going to depend on the reaction to the GDP number. Today's Market: S&P 500: Closed @ 1122.41 (-1.38%) Comments On Open Positions: [Reserved] Trade well! TraderNick