Stock Market Early Morning Insights – October 10, 2016

Quarterly earnings kickoff this week with Alcoa reporting tomorrow before the opening bell. We are receiving mixed messages from the major market stock indexes as traders digest Friday’s employment numbers, and the upcoming presidential election.

As of this morning, traders are evidently pricing in a Hillary Clinton victory because the index futures are up nicely this morning. Of course, this is today’s perception, and things can change dramatically over the next few weeks. With constantly changing revelations about the candidates, it is impossible to know what news will come out next, so be prepared for volatility.

As expected, the indexes were volatile on Friday, but volume was less than average. The NASDAQ managed to close at 52.41% of its intraday range, above support, after spending most of the session deep in the red. At one point decliners that advancers by over a 3 to 1 margin, but by the end of the session that was trimmed to about 2 to 1. This coincides with the candle on the NASDAQ composite closing above short-term support. In my Broad Market Indices folder not a single index had more advancers than decliners. The Healthcare Index was the strongest and that is confirmed in the top 50 GIR and the Stocks and Groups Moving to the Upside SmartGroup.

There is no doubt this is a dangerous and treacherous market, but on the other hand the indexes, especially the NASDAQ composite in the NDX, are holding up well. The mid-cap and small-cap indexes, the S&P 400 and S&P 600, are weaker, but are still well within their consolidation areas.

I didn’t do much prospecting this weekend due to the directionless nature of the broader markets, but here are a couple of stocks you may want to add to your watch list: VNDA and EXEL. Both are in the Biotech and Pharma major industry. OCLR is another stock to be considered because it is holding above its 18 period exponential moving average and has had two bullish VPA flags over the last four days. Also, it is in a strong Semiconductors Devices group. One of the stocks I mentioned Thursday, STML, had a tremendous day on Friday to close up 12.63%. At one point was up nearly 15%.

I remain neutral to slightly bullish on the broader markets, especially the NASDAQ 100 and the NASDAQ composite.

STOCK MARKET EARLY MORNING INSIGHTS

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