After a slow start, the bulls are trying to make another push higher and if current levels hold, it will be the fourth-straight up Monday and another set of all-time highs. The blue-chips are showing some strength despite the earnings miss by McDonald’s (MCD, $97.67, down $2.60) this morning before the bell.
The company reported a profit of $1.38 a share on revenue of $7.08 billion. The suit-and-ties were looking for $1.40 a share on sales of $7.09 billion. It was a sluggish quarter and the company said July sales are also expected to be flat. Shares are down nearly 3% and have accounted for 20 negative points on the Dow.
The Financial stocks continue to show strength as JPMorgan Chase (JPM, $56.59, up $0.43) and Bank of America (BAC, $14.95, up $0.20) continue to set new 52-week peaks and Tech is rebounding from Friday’s pullback and is pushing resistance again.
We threw the kitchen sink at you this morning as to what to expect from the market over the next few weeks and for those of you just joining us, remember to login to the Members Area to check all of the chart work for the indexes and for our current trades.
We said this would be a busy week with earnings that could have a major impact on direction this week and so far we like what we see. We have been closing our current call option trades and rining the register as we move to higher highs but we have become somewhat cautious as the major indexes are close to triggering our yearend targets. It doesn’t mean we are bearish as we will continue to trade the trend, it just means we need to be careful and take profits when we can.
We still haven’t seen a “capitulation” or blow-off top to new highs as the July climb has been slow and steady. Money is still moving into the market and volume is picking up. These are bullish signs and we covered a lot of this in this morning’s Daily and the Weekly Wrap.
Gold and Silver are also rebounding and we talked about how they could continue to do so before another steep drop. Gold is higher by $40 an ounce to $1,333 while Silver is up over a buck to $20.55. Both metals have a little more room to run before they push the next layers of resistance at $1,350 and $22. A strong move above these levels would signal a bottom is in but don’t trust these rebounds until the next waves are cleared.
We have a lot more to talk about in our Members Area so let’s get on it. As we head to press, the Dow is up 15 points to 15,558 while the S&P 5oo is advancing 4 points to 1,696. The Nasdaq is higher by 11 points to 3,599 and the Russell 2000 is gaining 3 points to 1,053.
Subscribers, check the Members Area for the updates. One of our trades has been closed for a 91% profit as our Hard Stop on the other half has been triggered.