Indexes Shake Off Early Weakness; Garmin, Woodward, Viking In Focus

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0:39Justin Nielsen:Good afternoon, everyone, and welcome to Stock Market Today for Monday, April 13th. It's Alyssa Coram here. And nice upside reversals for the major indexes today, despite some negative news flow. So we will dig into that. Joining me now to do just that and more is my colleague, Justin Yilson. Justin, what do you have for us today?

1:00Alissa Coram:Yeah, let's go through a couple stocks. We'll go through Garmin today, Woodward, which is in the aerospace defense area. And what was my final? Oh, Viking. I was trying to decide that third one. We're going to go with Viking, another upside reversal.

1:16Justin Nielsen:Sounds like a plan. Hey, I mean, if there's a lot to choose from, that's a signal about what kind of market that we're in. Exactly. All right. We'll get to those stocks. But first, let's take a look at the major indexes. The Nasdaq Composite today up 1.2 % by sessions close. The S &P 500 up 1 % on the day. You can type in SPX here. And then we can also take a look at the Dow up about a half a percent on the day, also reversing higher. And let's check out small caps. The Russell 2000 outperforming nicely with the Russell up 1.4%. So, I mean, we have the Nasdaq now up quite a few days in a row, a pretty solid win streak here.

2:02Justin Nielsen:And then, Justin, I think also if you take this in context of the headlines that are out there right now, it's especially impressive.

2:11Alissa Coram:Yeah, absolutely. I mean, one of the things that, again, over the weekend, some of the talks broke down and there was just a lot of, OK, we're going to be sending the U.S. Navy to the Strait of Hormuz and, you know, some escalating talk. And that was enough to really send oil skyrocketing. USO, of course, is one of the ways that we take a look at that. That was up considerably during overnight in the futures market on Sunday and then also at the open. And look, you were seeing some pressure on the indexes. But once we opened, it was remarkable that the worst we got for the S &P 500 and the NASDAQ composite was about a half a percent loss.

2:55Alissa Coram:Given that news that, again, a lot of people were, you know, looking forward to the ceasefire, that kind of is what started things. You know, talk of the ceasefire was what really kind of started the follow through day, this rally really happening. And you would think that this breakdown would cause a lot more angst in the market. And so the fact that we didn't come down that much and even better, not only did we not come down that much, but that we reversed and closed so strongly with a lot of stocks doing very well. It's a pretty remarkable thing. And it just kind of goes to show you it's not the news itself.

3:32Alissa Coram:it's the reaction to the news that tells you so much more about what you want to be doing in the market at any given time.

3:39Justin Nielsen:Exactly. And even though headline risk remains, there's a reason why we look at the technicals and we have our levels. We have our lines in the sand on the index level, as well as individual stocks, and we're managing risk, right? Just because there's risk out there doesn't mean you just stay on the sidelines, right, Justin? There's always risk. Yeah.

4:03Alissa Coram:And and, you know, I mean, something we were in a meeting with David Ryan and, you know, I was, you know, talking about certain stocks where it's like, oh, you know, you know, some of the chemical stocks, for instance, or oil stocks, you know, isn't there a little bit larger headline risk? And David Ryan is like, there's always headline risk. There's always something that can come out at any given point.

4:21Justin Nielsen:A boogeyman.

4:22Alissa Coram:Yes, exactly. Around that free corner. But yeah, at a certain point, you have to look at the market as a whole. Are there areas of strength? And right now, I think this market is handing us a lot of them.

4:33Justin Nielsen:Yeah. OK, so in terms of the NASDAQ levels that we are watching, well, on the upside, looks like that round number at 23 ,000 was a notable level that we cleared, Justin.

4:46Alissa Coram:Yes. And it's funny because on IBD Live this morning, you were asking me about levels, but we we kind of focused on the downside, you know, like, OK, the low of the the gap up day, you know, which is right around the 50 day moving average line and the 200 day moving average line. But you're right on the upside. You can kind of see at twenty three thousand. We had that brief little pop up back in February. Just a single day. Yeah, a little bit more. Yeah, there we go. A single day where we've.

5:12Justin Nielsen:The most recent time that we were there.

5:14Alissa Coram:The most recent time we got above 23 ,000. And, you know, I feel like that is kind of like a level. So the 23 ,000, you know, we poked up above it, hit our head on it on Friday. And now this was a very clear move above it. So, again, we started off a little bit on the ropes down underneath Friday's low. But by the end of the day, clearing kind of those upside levels just just goes to show, again, how strong this market is. And, you know, one of the things that we were talking about just before the show started was, you know, with the follow through day, it's the strongest markets don't just have a follow through day.

5:53Alissa Coram:They usually have multiple. And that kind of gives you a sense of a little bit more power there. And so that's exactly what we're seeing now. You know, follow through day type of action recurring. And that just gives you a little bit more confidence that something is happening and that the rally is gaining traction. Right.

6:13Justin Nielsen:Perhaps a follow through day in spirit today. Yes.

6:17Alissa Coram:Well, we have to wait and see what the trading volume looks like and dollar volume and everything like that for the for the final thing. But if you just scratched all of that, like Webby would do, the day itself looks looks like a follow through day. You know, I wouldn't even say in spirit. It just looks like a follow through day.

6:35Justin Nielsen:Yeah, compelling stuff. And I suppose the reason why I was looking back here to October is that bad break was the day that Webby and I looked at on a recent Stock Market Today video where that changed the tone and was really the start of the chop and slop that we had for months following. So we were now above that day. Yeah. So that's, I think.

6:57Alissa Coram:And let's not forget, in addition to October 10th, there was the November 20th, where it was stunningly even a larger day, you know, than the October 10th. November 20th was an outside day. And as much as we were like, oh, my gosh, look at how much distance the spread from the high to the low covered on October 10th, November 20th was also. And so this 23 ,000 level really kind of hits both of those. So there's, you know, certainly the stuff that happened months ago and also the more recent. So, again, just a lot of things. And the same way that we're looking at the 50 and 200 day, kind of right at the level of the lows of April 8th, we're seeing kind of, again, a convergence of different resistance levels that have just been really clobbered today.

7:46Justin Nielsen:Yes. Okay. Okay, let's move on, Justin, and take a look at the S &P 500. A quick note on levels to watch here.

7:56Alissa Coram:Yeah, so, you know, not as clear as the NASDAQ, but again, I think it's just undeniable, the strength that we're seeing here. And more importantly, we talked about how we want the market to pull us in, right? And, you know, keep on hitting these different hurdles. And so, of course, first it was, you know, can we get above that 21-day, the 200-day, the 50-day line? And we have. But more importantly, we're staying above those levels. And I think that the way that we're seeing this traction kind of unfold, you can see that the S &P 500, well, for both the NASDAQ and the S &P 500, the 50-day moving average line is starting to flatten out from that downtrend.

8:37Alissa Coram:And we're just clearly changing the whole look of the market right now. So on the upside, it's a little bit tough to see, you know, in the recent action. But here again, a lot of times when you draw that line to the left from where you're at, you start seeing, OK, well, gosh, we're we're coming up to that 69, 20, 34 level from all the way back in October. And it's interesting that, you know, again, we're we're kind of approaching that. And while we did get above that level a number of times, we just couldn't stay above that level. So I think that's going to be an important test. Can we get above it, number one?

9:15Alissa Coram:Number two, can we stay above it?

9:17Justin Nielsen:Yes. All right. Quick thoughts on the Dow and the Russell before we move on here. Here's the Dow.

9:24Alissa Coram:Well, look, the Dow was getting a little bit clobbered earlier in the session with a 1 % loss, at least when we were opening. And a lot of that had to do with Goldman Sachs. You know, earnings on Goldman Sachs were, you know, it was taking a hit. But while it was down today, it got a lot of support, came right down to the 50-day moving average line. A lot of buying power came in and it closed down almost, you know, 1.9%, but well off the lows and a nice upside reversal. So the Dow kind of looks similar. Again, this was what was really dragging the Dow down. It's a higher price stock at almost$900.

10:03Alissa Coram:And so, of course, that's going to have a lot of effect for a price weighted index like the Dow. So again, nice to see this get back above its 50-day moving average line after spending some time below it today. But I'll also say the Dow, let's be honest, is not really the index that we're watching that closely.

10:22Justin Nielsen:And let's take a look at the Russell.

10:24Alissa Coram:Now, the Russell is looking a lot better. So very powerful. And again, this was one that was down considerably over the weekend as news came out and the futures opened. But again, a very stunning move here, up over 1.4 % for the Russell 2000. So a very good look and very clearly breaking the downtrend. So again, we just have a lot of the indexes looking very different. After a lot of downward pressure, you're seeing these breaks of downtrends. And not only that, but you're also seeing it in a lot of stocks where these resistance levels are being hit. And, you know, I do, I should mention that I do have positions.

11:08Alissa Coram:I didn't mention this to the outset, but Garmin and Viking, I do have small positions in both of those. And in the indexes, I have, I have exposure to the S &P 500, the Qs and, and IWM through, through different leveraged products.

11:24Justin Nielsen:Yes. Same here with the Qs. Okay. Let's move on, Justin, and let's have you take a look at some sector action. Here's the IGB outperforming today. So software outperformance, but not from an ideal setup, right? So a long way to go. But we did see money flowing to the software sector today. IGB at 5.4%. Yeah.

11:50Alissa Coram:And it was funny because in the comments on IBD Live, a lot of folks were asking, OK, is this the washout? Is it time for IGB and software to come back. Look, I don't know, but this is just not where I like to do my buying. So it's one of those things where, yes, I'm going to take note. I couldn't help but notice as I was looking at the sectors that software was up so much at this ETF, but this is still below a declining 50-day moving average line. I could easily see, just like we saw last week, just get up to the 50-day moving average line, get turned away, and have another leg down. And even if it doesn't happen that way.

12:25Alissa Coram:This is just, you know, this is not where the action has been. This has a lot of recovery work to do. And you can say that there's a lot of times where these things that have been beaten down, they can have really strong bounces, but with so much better quality out there, so much other things showing relative strength. That's where when you look at the model book stocks going back for the last hundred years and you look at the leaders, they usually are those ones that when the market turns, they're the ones that the relative strength is already pretty spectacular. So while this could have a great move, I'm not denying that, I think the odds are still better.

13:04Alissa Coram:Again, where IBD methodology tends to go is the strength, especially that relative strength.

13:10Justin Nielsen:Exactly. I mean, simply put, looking for leading stocks that are in uptrends and holding above rising moving averages. Like you said, if you look at the model book stocks, that's what they're doing. So helps with the stock selection there.

13:26Alissa Coram:I think it was Dan Fitzpatrick that was on the podcast the other day, and he was referring to either like a grandkid or kid that, you know, was looking at a chart of his that he pulled up. And, you know, four-year-old or something like that. And she said, oh, look, a slide. And he's like, oh, yeah, that's a bad chart. A four-year-old is looking at it and looking at it like a slide. And that's what IGV is. I mean, this is a slide. So, again, that's not where we tend to do our searching.

13:57Justin Nielsen:Yes. Okay. Let's also take a look at the chips. Here's SMH. This is more like it, right, Justin? SMH at new highs, up 1.5%. Not advising chasing here, but there have been opportunities over the last couple of trading sessions to perhaps initiate and accumulate positions either in something like this or in this sector.

14:24Alissa Coram:Yeah. And as a reminder, I mean, let's just pull up NVIDIA real quick because NVIDIA, of course, is the semiconductor everyone watches. And this is not where the strength is coming from for SMH, even though this is a very heavy weight in the SMH. And I do have a position in SMH and SOXX, which is very similar, just a little bit of a different weighting on some of the things. But yeah, it's not NVIDIA that's driving these. There's a lot of other names in here. And you can even kind of bring this to tech itself. If you look at like XLK, which is the tech sector, tech sector spider, I mean, you know, a really good day for the tech space.

15:04Alissa Coram:But, you know, again, as we said, software and semiconductors have been acting very differently lately. Now, together, they were both kind of in, you know, rowing in the same direction today, sending that XLK higher. But, you know, semiconductors have been in a very different space. And there are some of these that, again, not I'm not talking about your NVIDIAs, I'm talking about the whole host of other names like TSEM. I do have a position there. Teradyne, T-E-R. You know, these are some stocks that already were breaking out, you know, some of these, you know, are breaking downtrends, you know, very early on.