Minyanville's T3 Morning Market Call: Sell in May or Stay and Trade?


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S&P (INDEXSP:.INX) futures are now up about six handles this morning after the ECB elected to cut its key interest rate by 25 bps to 0.5%. Expectations for such a move had grown in recent days, so it doesn't come as a complete surprise, but markets are responding positively.

The question today is, did yesterday's sell-off mean anything? Is it "sell in May and go away" or "rotate in May and stay and trade"? We will know more on that front in the next two sessions, but signs are positive so far this morning. At this point there is nothing wrong with being a bit more light on your feet. If you are very active you can use S&P 1577-1581 as an upper level pivot, or the 21-day at 1572. It feels like each group is taking a turn leading the tape before correcting or resting.

Metals are still choppy and erratic. The $139.30 level is new pivot support and $143.30 is resistance for gold ( GLD ), the rest is just noise for now.

Banks were the first to go down yesterday. See if they can bounce back today.

Tech is mixed.

Apple ( AAPL ) had a spirited move after earnings. It held the 50-day moving average yesterday, so right now composure remains a bit more bullish. The longer it stays above the $433-435 the higher the probability I think it could take out $445 for a move to $465ish or higher.

Google ( GOOG ) acts well since earnings. The stock needs to hold above $811-815, I believe, if it hopes to take out 2013 highs soon.

LinkedIn ( LNKD ) is best of breed as it continues to make new highs. We listed this last week at $178 for a buy trigger then again at $186. Now it's trading at $195. Earnings are out today; can it deliver another big beat and gap up?

Facebook ( FB ) reported pretty much in-line earnings. The headlines are gravitating towards the 30% revenue increase in mobile. The stock needs to get a 30- or 60-minute close above $28 to get more interesting. FB is up about 1.5% this morning.

Netflix (NFLX) is still hovering above the earnings gap. Use $209.50-211 as the support pivot to trade against.

Yahoo (YHOO) has been riding the 21-day MA so a move back to $24ish is a spot to see if you can buy the dip.

EBay (EBAY) has been hovering below most moving averages with a big hole in the chart since earnings. If it gets above $53ish maybe you could get a long. If it gets below $51 it could see lower prices.

Amazon (AMZN) did not get a pass from the Street this earnings season. The longer it stays below the 200-day or the $251ish level, the higher the probability I believe this can see $225.

Chipotle (CMG) looks pretty good, but needs to get above $367ish to get more interesting.

Las Vegas Sands (LVS) had decent numbers and now needs to trade and hold above $57 to get more interesting.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Stocks
Referenced Stocks: AAPL , FB , GLD , GOOG , LNKD

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