While it may not be polite, you can pick your bottom – much easier than you can pick a top. No doubt there were plenty of traders trying to pick both today – as the run-up, up, up and away in the equities made it quite uncomfortable for any bearish fades as the mechanical bull kept pulling the wedgies higher and higher… After getting caught once, twice, even three times, many went to the sidelines – thinking twice before licking their wounds …
Snippets: Today was one of those days that everyone seemed to have differing opinions of what was supporting the rally, but very few appeared to see the potential of the straight-up rally. It may have been the way the new Fed chair, a known “dove,” manhandled her Q&A during her testimony. Some think it was some things Janet Yellen said during her testimony, or for that matter it could be that our um, bipartisan politicians appear to be close to nailing down a debt deal that they ultimately won’t follow anyway. Even the presser by President Obama did not receive its customary welcome – an equities pullback – that many have come to count on.
Yellen: A notable change in the economic outlook would lead the Fed to consider a pause in bond tapering. Must see economic growth at above-trend pace to be able to forecast continued growth in the labor market. A ‘notable change’ in the outlook would cause a pause in taper. If or until that would happen, continued pullback in Fed stimulus likely. QE has worked, says bond tapering not on a preset course. Fed could reconsider if it saw a change in the economic outlook. Surprised at low jobs data. Have to be careful not to jump to conclusions, cites weather factors. Fed will have more data in March. *YELLEN SAYS LAND PRICES SHOWING SOME LEVEL OF OVERVALUATION. *YELLEN SAYS STOCK PRICES NOT IN BUBBLE TERRITORY. We saved the best for last – maybe that is all that matters – at least for today it was…
JPM says Q4 GDP is tracking +2.6% after the wholesale data. Goldman’s Q1 current-quarter estimate remains at 2.3%.
Today started with 310k ESH and 1.2k SPH traded on Globex, ESH trading range was 1804.50 – 1794.25. Yesterday’s regular trading hours (RTH’s), pit session trading range was 1795.50 – 1787.00 before settling at 1794.70, up 1.2 handles. Overseas markets were up across the board but gave back some of the gains entering the U.S. opening.
Today’s RTH’s, pit session, opened 2 handles higher; first print of the day, 1796.50, was also the intraday low. The opening range was 1796.50 – 1797.00. The first half-hour high was 1802.20 area followed by sideways to higher, stepping ever so quietly higher throughout much the session. The straight-up price action slowed at a couple of pre-identified resistance areas, but there was not much of a pullback to allow for cheaper entry – leaving buying at or near the highs of the move. william_blount (09:47) more bubble gum, from here to 1812.5 than a party at BAZOOKA JOES HOUSE. As sticky as it was – We saw lots of short puts being rolled up and or out…and short calls being covered during the session.
PivotBoss midday video: http://bit.ly/1iLVTQS ADR Targets: http://bit.ly/1iYa5pj
Midafternoon the S&P quietly traded a fresh intraday high of 1819.30 as the E-mini vol was tracking a modest 1.6Mk – a tad light considering the Fed chair testimony and the size of the rally. Following nearly $4 billion to buy in recent days, the MrTopStep imbalance Meter, MiM, showed a modest $220M to the sell side. The futures traded 1814.60 area on the cash close before settling at 1813.60, up 18.9 handles. Volume was good, but light for the conditions – 1.75M E-mini’s traded.
Coming events: http://www.investing.com/economic-calendar/
Earnings pre-market: [AB], [ANR], [CSTE], [DE], [DPS], [HSP], [NEWS], [OC], [PNK], [SPW], [VAL], [VOYA], [WIX]
WE HAVE SEEN EQUITY OUTFLOWS OF $28.3 BILLION IN THE LATEST WEEK. ACCORDING TO LIPPER, THIS IS THE BIGGEST WEEKLY EQUITY OUTFLOW ON RECORD.