MLR - Premarket Pulse January 4, 2013

Published : January 4 2013 at 8:43 ET

The release of the Fed minutes from their prior policy meeting sent the indexes into a mild reversal yesterday after they were making an attempt to rally for the third straight day. Objectively, the indexes took one day to consolidate the prior two day's worth of very heady upside gains, and they did so on lighter volume. The Fed's indications that they are looking to end bond purchases in 2013 sent precious metals reeling to the downside, and this morning gold is down over 2% while silver is pushing down nearly 4% as of the time of this writing. The precous metals have been signaling that something is up, and yesterday's release of the Fed minutes may have revealed something material in this regard.

The U.S. economy created 155,000 jobs in December and the unemployment rate was unchanged at 7.8%. Economists expected an increase of 160,000 jobs. The unemployment rate, originally reported as 7.7% in November, was changed to 7.8% after the Labor Department's annual revision conducted each December.

Some leading stocks are holding on tentatively to their recent upside moves and breakouts, while others are showing scant follow-through. Some of the best moves occurred in so-called "junk-off-the-bottom" such as the action we've seen in stocks like (AMZN) and (PCLN) as they have rocketed back up to their recent highs in nearly cathartic fashion over the past three days as they engage in straight-down-and-straight-up action.

Apple (AAPL) has found resistance at its 10-week moving average on its weekly chart, closing just below it yesterday while getting close to its 50-day moving average, currently at 557.33, on Wednesday. Should the market rally weaken or prove to be a short-lived news-related phenomenon, AAPL would remain as one of our top short-sale candidates given its position within a second right shoulder in its current head and shoulders formation.

Stocks like Three D Systems (DDD) and Polyone (POL) continued to move higher yesterday, and they represent stocks that have been able to follow-through on Wednesday's strong gains. DDD remains within range of Wednesday's buyable gap-up move, using the 55.20 intra-day low of Wednesday's gap-up range as a quick selling guide. Otherwise, outside of Wednesday's action, no new pocket pivots or buyable gap-ups made it through our screens on Thursday.

Again, investors are advised to operate methodically without getting carried away by Wednesday's huge upside market move, picking their spots and their stocks carefully.

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