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Market Lab Report - Premarket Pulse 5/5/17

Published : May 5 2017 at 9:14 ET

Major averages finished roughly flat on mixed volume. The House passed a revised bill to repeal and replace Obamacare. The bill will undergo more revisions before being put up to a vote in the Senate.

While the Fed remains undisturbed by the recent slowdown in GDP, this might be a form of posturing by putting on their brave face. Nevertheless, CME FedWatch suggests a hike in June and in December.

Futures are up as April nonfarm payrolls hit 211,000 vs. est 180,000. The prior month's reading was revised to 79,000 from 98,000. Nonfarm private payrolls added 194,000 vs. est 175,000. The previous month's reading was revised to 77,000 from 89,000.
The unemployment rate fell to 4.4% vs. est 4.6%. Average hourly earnings increased 0.3% vs. est  0.3%, while the previous month's reading was revised to 0.1% (from 0.2%). This gives the Fed more fuel to maintain their mandate of two more rate hikes this year, though the evidence of an economic slowdown is mounting. 

Focus List Review

JD had a pocket pivot as it continues its uptrend as do other leading Chinese names such as BABA and MOMO.

BZUN had a 15% move on Monday and Tuesday on an intraday basis before reversing. That would have made for a strong swing-trade based on our comments over the weekend in our Focus List Review. It has now returned back to its 10-dma on volume that was -42% below average, putting it back into buy position using the 10-dma as a tight selling guide.

CC is holding tight along its 10-dma and 20-dema with volume drying up. Earnings were announced earlier in the week, so "earnings roulette" is now out of the picture.

FB found support at its 10-dma yesterday and bounced off the line. As we pointed out in our note yesterday, a pullback to the 10-dma after earnings would offer a lower-risk entry opportunity.

SNAP posted a pocket pivot off of its 10-dma, but stalled to close mid-range but still up strongly on the day.

TSLA has breached the $300 Century Mark on heavy selling volume after earnings. The move also took the stock below its 10-dma and 20-dema, but less than 2% below the 300 price level, which may or may not trigger a stop depending on how much downside porosity through the 300 level is allowed for.

We have been looking for a move by TTD back up through its 50-day line following constructive action along its 10-dma and 20-dema per our discussions of the stock in our last two weekend Focus List Review reports. Yesterday TTD posted a pocket pivot coming up through the 50-dma ahead of earnings next week.


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