Uptrend continues, despite lagging tech sector
The new highs made this past week in most major market indices – except, notably, the tech-heavy Nasdaq – confirm an ongoing intermediate- and longer-term uptrend, which is also reflected in the currently all-green weekly trend picture. While the still-lagging Nasdaq remains a concern, another under-performing index – the Dow Jones Transportation Average – did finally break out to a new high, presumably giving Dow Theorists a reason to cheer.
Upside resistance levels appear to be about 1455 and 1480 on the S&P 500, and ~2510-2520 and ~2600 on the Nasdaq. Near-term downside support levels are about 1430 and 1415 for the S&P 500, and 2430 and ~2400 for the Nasdaq.
New positions
Allstate (ALL) – Last Wednesday I sold some February 60 puts on ALL as the stock fell 6% after the company reported lower-than-expected fourth-quarter results:
Despite the recent sharp sell-off, the stock remains in an intermediate-term (and longer-term) uptrend. Near-term downside support levels are ~60, 57-58, and ~55. Upside resistance is at ~63. A break below the 57-58 level would cause me to change my intermediate-term outlook.
Watchlists
Plenty of new stocks of interest showing up in the “upside strength” scans this week, including Alcan (AL), Apache (APA), AT&T (T), Emerson Electric (EMR), Gerdau S.A. (GGB), Illinois Tool Works (ITW), Ingersoll-Rand (IR), International Paper (IP), JP Morgan (JPM), KeyCorp (KEY), New York Community Bancorp (NYB), Parker Hannifin (PH), Quanex (NX), SPX Corp. (SPW), Standard Pacific (SPF), Starwood Hotels & Resorts (HOT), Teekay Shipping (TK), and YRC Worldwide (YRCW).*
New additions to the “oversold” list this week include 3M (MMM), Allstate Corp. (ALL)*, Acxiom Corp. (ACXM), IndyMac Bancorp (NDE), and Nam Tai Electronics (NTE).
* I currently have an options position on this stock.
