In my Market Direction outlook last night I expected the morning to be weak and then in the afternoon a push to try to get higher. The morning plunge in market direction though almost wiped out most of yesterdy’s gains as investors reacted negatively to the big contraction in the Chicago Purchasing Managers Index which came in at 49, the lowest reading since September 2009. March was at 52.4 which was a bit on the anemic side as it was. But just as the market direction was plunging, suddenly out came better than expected consumer confidence readings. Actually a lot better than expected with the consumer confidence up to 68.1 for April which was a big jump from March’s 61.9 and beyond any of the analysts’ estimates. When that number hit the market the down trend ended and the market pushed back up. The other wonderful comment that was released to the media was the “consumer confidence next 6 month expectations” number which jumped from 63.7 to 73.3 in April. Honestly, where do all these numbers come from? Is there really a Consumer Confidence 6 Month Expectations Department and if so, I would love to work there. I bet it is in the same building as the “Pie In The Sky GDP Department”.
Whoa On Those Numbers
When that number came across the screen I thought whoa, where in the world do they keep getting these numbers from. I just find it odd that when big down numbers come out, big up numbers follow? Is someone simply throwing darts or picking numbers from a hat? This makes me wonder if we are being “set-up” for a surprise on the unemployment numbers on Friday. But then I remember how things are never manipulated anymore and just go back to Put Selling my stocks… wink wink.
Market Direction Intraday Chart
You can see the open with the PMI numbers and then the plunge and then consumer confidence numbers and the rally back up. The S&P then started back with the old higher highs and higher lows that is indicative of a bull market.
Market Direction News
This morning I sold puts a number of stocks and I see Doug Harris bought the UDOW for his market direction portfolio. You can review his Market Direction portfolio trades for 2013 here.Pfizer stock was an excellent trade this morning and I am so looking forward to selling puts on PSX stock if only it would drop just below $60 to get the market maker to jump those $55 puts for May 18 expiry. All my trade alerts were up as they happened and were on my twitter account and are up on the FullyInformed Members site.
Market Direction Intraday and IWM ETF Russell 2000
I won’t show you the IWM chart but suffice to say it is holding up well as it still clings above the 50 period simple moving average (SMA). But it has not broken into higher valuations which could be the first sign that May could be weaker than expected. I have read a lot of reports over the past couple of days that analysts expect the Sell in May mode not to work this year. I think it is too early for that decision to be made yet, although I still think this week will remain decent for stocks.
Market Direction Intraday Summary for April 30 2013
I still think the market direction will break into new territory this week for the S&P 500 but after this week I will have to reassess. Meanwhile I am quite happy with the Put Selling at this point in the market direction. Meanwhile for investors who are following the Stock Market Trading Strategy on the VIX Index, I am watching the VIX Index carefully and preparing for another trade if there is a chance to buy calls cheaper shortly especially if market direction gets a bit higher this week.
We are at the end of April and once more this month has chalked up gains for the market direction and most stocks. This end the 6 months of the best months strategy for the stock markets. I will be keeping tabs on the market over the next 6 months to see if the 6 Best Month strategy continues to perform well. More on that in the coming months!
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Understanding Short-Term Signals
Market Direction Portfolio Trades for 2013