It was more of the same. We once again spent the earlier part of the day around unchanged, dipped in the negative and then managed a late day rally which led to new highs for the move which started March 9th. The market gave up some of its gain in the last 20 minutes and at the end of the day the Dow was still in the green and closed + 5.9 points or 0.07 %.
The broader indices did better with the S&P closing + 0.50 % and the Nasdaq + 0.16 %.
The market had to deal with a slew of earnings, among them Google, Citigroup and GE. All three of them came in better than expected but also came with baggage. Better than expected earnings were, for the most part, either due to cost cutting or reduced bad loan provisions.
I vouch to say that today's earnings would have moved the market in a very meaningful way at any time during the last couple of weeks...but not today. There seems to be a general malaise settling in and the market does seem to run into some real headwinds after 5 weeks of trading North.
Current market action can only be described as lackluster...potentially exacerbated by the fact that April options expired today.
Regardless, I know feel that we are approaching an imminent correction. Unless the market comes out of the gate strong on Monday and trends higher rather quickly it seems probable that we are going down, at least for a little while.
Today's high of 8190 fell just short of my upside target of 8250 and as long as we are unable to overcome the 8200 to 8250 area I am now market neutral.
There might be another push higher but I would view this as an opportunity to short the market. A downside move below 7850 would indicate that a more substantial correction is developing and I would then expect 7450 to 7500 as a downside target.
Enjoy your weekend and see you next week,
Steve Benger
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