I’m Bullish, but Not Ready to Buy

Bulls making headway against a barrage of bad news but facing very tenacious resistance

I’m Bullish, but Not Ready to Buy

Stocks flatlined Tuesday due to weak economic data, taking all three major indices to small losses. The Dow industrials fell 0.17%, and the S&P 500 and Nasdaq were both off 0.13%.

Consumer confidence fell to 78.1 in February from a revised 79.4 in January, and the S&P/Case-Shiller 20-City Home-Price Index rose 13.4% year-over-year in December, where 13.6% was expected.

Despite a slight drop in the technology sector, biotech stocks were strong with the iShares Nasdaq Biotechnology (IBB) rising 0.42%. The consumer discretionary sector was strong, led by Home Depot (HD), which was up 4%. The company reported better-than-expected earnings and issued positive guidance, but missed on revenues.

Financials, health care and the technology sector slumped during the final hour of trading, dragging the S&P 500 to a minus for the day.

At Tuesday’s close, the Dow Jones Industrial Average was off 27 points at 16,180, the S&P 500 fell 2 points to 1,845, and the Nasdaq was off 5 points at 4,288. The NYSE’s primary market traded 647 million shares with total volume of 3.5 billion shares. The Nasdaq crossed 2.1 billion shares. Decliners outpaced advancers by 1.2-to-1 on the Big Board, and on the Nasdaq, decliners outnumbered advancers by 1.5-to-1.

02 26 14 nyse 300x192 Im Bullish, but Not Ready to Buy
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chart key 300x84 Im Bullish, but Not Ready to Buy

Like the S&P 500, the NYSE Composite is making its third attempt at a breakout. And also like the S&P 500, it made a new high on Monday, but failed to follow through Tuesday.

The bounce from a sell-off low at its 200-day moving average early in February has run into minor resistance, but the recent new high, a neutral RSI and a bullish MACD are encouraging signs.

Conclusion: The bulls are still charging and making slight headway against a barrage of bad news. It is considered a very favorable sign when the market fails to fold under that kind of negative pressure. Therefore, I remain bullish but still not prepared to initiate new positions until buyers push the major indices safely through what has been very tenacious resistance.

Today’s Trading Landscape

To see a list of the companies reporting earnings today, click here.

For a list of this week’s economic reports due out, click here.

Article printed from InvestorPlace Media, http://investorplace.com/2014/02/daily-stock-market-news-im-bullish-ready-buy/.

©2015 InvestorPlace Media, LLC

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