MLR - Pre-Market Pulse for Thursday, March 14, 2013
The major indexes continue to move higher as volume remains light while most leading stocks continue to act well. That said, we have not seen any new, actionable buy points that we have considered worthy of a real-time report, although we did note yesterday that Netflix (NFLX) issued a pocket pivot buy point coming up through its 10-day moving average. The stock, however, has a 71 Composite Rating and earnings over recent quarters have been negative, so at best would be considered a potential turnaround situation.
Apple (AAPL) is up this morning on a buy recommendation, something of a change from prior days' which have seen all the analysts who rated the stock a screaming buy closer to $700 now rate the stock a sell. We tend to look at AAPL as a short, however, into these sorts of news rallies, most of which lately have centered around actions the company can take to utilize its cash hoard for the purpose of bolstering its stock price. We would need to see the stock get above Monday's high of 439.01 before we would consider it having any chance of breaking out of its current, almost too-well-defined downtrend.
As the great futures trader Ed Seykota liked to say, the trend is your friend until it bends at the end, and so far this market hasn't shown any willingness to bend. As it continues to rally on light volume, yes, it does become vulnerable to a pullback, but another move higher that sees volume pick up would serve to negate this and set the rally back on even firmer footing.
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