Thursday Feb. 4 Premarket Analysis
Today in the Stock Market
Dear Fellow Traders
Mixed economic data and disappointing earnings caused the Dow Jones Industrial Average to lose some ground on Wednesday. Although the ADP employment report was slightly better than expected, it was overshadowed by disappointing ISM non-manufacturing index data. Wednesday’s price action isn’t as bad as it could have been. The market has kept most of its gains from the previous two-day rally and is trading in a tight range with support around 10,200 and resistance at 10,300. I think we can expect this range to hold until Friday’s nonfarm payrolls report give further guidance on the state of the economy.
It was a different story for the tech sector. Despite a general market selloff QQQQ, the ETF of the NASDAQ composite managed to make further gains. The ETF opened on Wednesday at $43.45 and closed at $43.89. With Wednesday’s volume lower than the daily average I am not very convinced in this three-day rally. If QQQQ, can close above $44 with strong volume I think it could add momentum to the previous moves.
Wednesday was relatively quiet for the gold market. GLD, the biggest gold ETF appears to be caught in a channel with support at $108 and resistance at $109. The U.S. dollar continues to be the biggest factor in gold prices. According to some of the comments I have heard on Wednesday, concerns about Portugal’s debt caused the euro to fall against the greenback. GLD managed to hit a high of $109.54 however was unable to hold those gains and closed at 108.70.
Wednesday morning we released our latest pick but it never triggered our buy signal. As we said in the report we want to wait for a break of $0.035. We still think this stock has very good potential however we don’t want to just jump in right away. On Wednesday the stock hit a low of $0.025 and managed to close slightly higher at $0.028. We do like this stock because of its low price and liquidity. On Wednesday 3.9 million shares were traded so that means when the price hits our trigger we will be able to get in and out fairly easily.
We are excited about one of our recent picks, BPAC. It was a relatively volatile day for the stock but it managed to close in positive territory. In intra-day trading the stock slipped below its 20-day moving average, which probably triggered a buy signal for some investors. BPAC ended the day at $0.55.
On Wednesday we saw a surprising move in BGOI. The stocked opened at $0.05 and spent the entire session in negative territory to close at $0.04. I am not convinced this is a shift in momentum. The stock had a strong rally last week and I think this move we are seeing is from someone trying to push the price down and pick up at a lower price. What is interesting is that the stock touched its 20-day moving average at $0.035 and then bounced off the low.
We are seeing a similar move in BYSD. As i explained a few days ago, BYSD was something where i added at around $0,30 based on the fact it had some good things coming up and now it looks ready to make a nice move… It hit a low on Jan. 29 of $0.20 and on Wednesday it hit a high of $0.415. Wednesday’s move was also accompanied with very strong volume, which is a good indication that prices will move higher.
With gold unable to break through its current range, AGCZ is having a difficult time trying to find some traction. The stock opened at $0.236 and hit a low of $0.20 but was able to rally back and close at it’s opening price.
Have a Great Trading Day!
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What are your thoughts on RVBF?