Major market indexes endured a volatile week, starting with a minor oversold bounce on Monday that blossomed into a two-day rally before the NASDAQ Composite ran into 10-dma resistance and reversed hard on Wednesday. On Thursday the index broke lower after hot GDP Deflator inflation data was reported to test the lows of two Fridays ago and recovered off the intraday lows. It then gapped higher on Friday after PCE inflation data came in as expected at 0.3% on both the headline and core numbers. By the close the index finished a volatile week back above the 20-dema but below potential resistance at the 50-dma. Volume all week was light.
Precious metals gold and silver continue to track along 20-dema support with the SPDR Gold Shares (GLD) closing above the line on Friday while the iShares Silver Trust (SLV) closed right at the line.
Bitcoin ($BTCUSD) triggered three short-sale entries this past week. The first occurred near 50-dma resistance on Wednesday and was soon followed by a second short-sale entry trigger at the 20-dema on the same day. After attempting to stabilize on Thursday, $BTCUSD then finished Friday just below its 10-dma where a potential third short-sale entry trigger was established but without significant further downside. Selling volume on Friday was light, so $BTCUSD could trigger a long entry if it is able to recover quickly back above the 10-dma and 20-dema. Otherwise, it remains in a choppy seven-week consolidation.
Alphabet (GOOGL) broke out on Friday after reporting earnings Thursday afternoon on a buyable gap-up (BGU) move. It remains within buyable range using the 169.65 intraday low as a tight selling guide.
Microsoft (MSFT) also gapped higher on Friday after reporting earnings on Thursday after the close, but the end result was much different from GOOGL's. The stock approached 50-dma resistance and then reversed along the 20-dema to trigger a potential short-sale entry at that point. It then closed near the intraday lows, and just below the 10-dma where a second short-sale entry was triggered using the 10-day line as a covering guide.
Arista Networks (ANET) and Nutanix (NTNX) have both rallied into potential short-sale range along moving average resistance. ANET has rallied into its 20-dema where it reversed on Friday to trigger a short entry using the 20-dema as a covering guide. NTNX rallied into its 50-dma and stalled, so remains in a short-sale entry position using the 50-day line as a covering guide.
The Market Direction Model (MDM) switched to a BUY signal on Monday, April 22, 2024, then switched to a CASH/NEUTRAL signal on Thursday, April 25th and currently remains on a CASH/NEUTRAL signal. A materially weak GDP result together with META’s valuation plummeting after a disappointing earnings report caused the major averages to gap lower at the open on April 25th. This was followed by strong earnings out of GOOGL and MSFT which caused the majors to gap higher the next day but on lighter volume. The dead cat bounce remains in effect. We still have reports due from other juggernauts finishing with NVDAs earnings are due May 22.