By Markus Heitkoetter
It feels like we’re stuck on roller coaster that just won’t end. After yesterday’s drop, you guessed it…Stocks bounced right back!
The DOW had another triple digit day, ending the session at 16,677.90 and 217 points higher. With a 1.32% gain the DOW outpaced the S&P for the first time this week.
But S&P traders can’t complain after a 24 point gain. With today’s close of 1950.82 the S&P continues to pull away from the 200 day moving average and the 1900 mark, a levels that have acted as both support and resistance throughout the year.
Better than expected earnings from heavy weights like Caterpillar Inc (CAT) and 3M (MMM) helped today’s rally. As we wrap up the week traders will continue to keep an eye on earnings, and look towards tomorrow’s New Home Sales release at 10am ET.
Caterpillar Inc (CAT) has trended nicely all year. In a picture perfect chart we had a Sell Signal on 10th Sep 2014. Conservative traders opted for a quick 7 day trade and Average Daily Range exit at $102.15. But more aggressive traders had an opportunity to ride the trend, closing a short with a Power Crossover exit at $95.04.
Today CAT rallied and ended 5% higher after better earnings and raising yearly forecasts. With today’s rally we have a Power Crossover Method uptrend. We’ll see if we get a buy trigger according to rules during tomorrow’s session.