Stock Market Early Morning Insights – April 12, 2016

The Healthcare sector and Biotech rally that materialized last week seems to be failing. What looked like a promising rally has fallen victim to profit taking as stocks enter the earnings season, but it may only be a short term pullback.

Yesterday was the third consecutive day where the NASDAQ Composite opened higher only to close near the low of its intraday range. This index has the feel of distribution, but volume remains light, so the selling pressure is not intense. Also, internals were only slightly negative, but there was deterioration as the day progressed.

For the past few days money has flowed into Energy stocks, but primarily into Precious Metals stocks.  Some of the leading stocks in the Precious Metals and Mining stocks have broken out to new highs on strong candles and heavy volume. The gold and precious metals rally seemed to be over several days ago, but the sector was only taking a breather. This is way it is so important to look at both daily and weekly charts have change direction from higher highs and higher lows, to  lower highs and lower lows. The GLD charts did not signal a change in trends, and neither did the VPA trend signals.

Stock futures are positive again this morning. The early morning momentum is going to have to hold if stocks are going to break out of this trading range, but it is too soon to consider this rally as being over.

STOCK MARKET EARLY MORNING INSIGHTS

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