MLR - PMP 2/5/14

Published : February 5 2014 at 9:12 ET

The major market averages bounced yesterday on low volume as the NASDAQ holds support around the 4000 level. This should normally bode well for a continuation of the downtrend, but with quantitative easing continuously flowing, the market may find a floor sooner than later if it hasn't already. That said, futures are currently down in the premarket. The pronounced selling pressure over the last several days could end in climax selling with put-call ratios spiking. Though it is entirely possible with QE directing the markets that we could baby step higher as the market has done a number of times before.

The Market Direction Model, however, remains on a sell signal as the selling pressure of the last several days has been abnormally high since January 2013, and is almost reminiscent of August 2011 when U.S. Treasuries were downgraded and fears permeated through the markets that QE would end sooner than later.

Luxury retailer Michael Kors Holdings (KORS) had a buyable gap up yesterday after a strong earnings report. ROE 52.9%, group rank 63. We have reported on KORS before. Keep in mind that market conditions are highly volatile so position size accordingly, or just add KORS to your watch list then take action on a later day.

Tableau (DATA) is looking to have a buyable gap up this morning after a strong after-hours earnings report yesterday. One analyst firm raised its price target to $105 from $80. Earnings and sales are accelerating, group rank 34.

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