Thursday seemed like a replay of Tuesday with stocks not moving too far from the breakeven point on the day. All four of the main indices did end up with losses, but they were modest losses.
The Nasdaq suffered the worst loss at 0.29% and it was followed by the S&P with a decline of 0.28%. The Dow dropped 0.27% and the Russell was the best performer, but that was with a loss of 0.25%.[hana-code-insert name=’adsense-article’ /]The action was a little surprising given that the initial look at fourth quarter GDP was better than expected.
The sectors were skewed a little more toward the bearish side on Thursday with seven finishing in negative territory and only three finishing in positive territory.
The utilities sector led the way with a gain of 0.55% and it was followed by the consumer staples sector with a gain of 0.48%.
The worst performing sector was the materials sector which lost 1.24% and it was followed by the energy sector with a loss of 0.99%.
Those two losses were substantially greater than the other sectors.
My scans produced 49 bearish signals and 12 bullish signals last night and that caused the barometer to move up to -28 from -29.5.
With the market meandering for the last few days, I seem to be doing the same as I have alternated back and forth between bullish and bearish trade ideas. Today’s is a bearish one on Sony Corp. (NYSE: SNE). The company scores a 30 on its EPS rating and a C in the SMR category.
Sony has been trending lower since last September and a downward sloped trend channel has formed over the last five months. The stock just hit the upper rail of the channel and that rail is just above the 50-day moving average. We also see that the stochastic readings are in overbought territory and just made a bearish crossover.
Buy to open the April $50-strike puts on SNE at $3.00 or better. These options expire on April 18. The options will double if the stock falls to $44.00. The stock dropped down below $43 back in early February so it won’t have to break to a new low or hit the lower rail of the channel to double. I suggest a target gain of 100% with a stop at $48.80.
— Rick Pendergraft[hana-code-insert name=’MMPress 2′ /]