Good Day For Stock Market Bulls As Nasdaq, S&P 500 Rise 1%

The Nasdaq composite gapped above its 50-day moving average and held a solid gain Monday afternoon as the bulls enjoyed a day in the sun.

XAutoplay: On | OffThe Nasdaq rose 1.3%; the S&P 500 also gapped up above the 50-day line, rising 1%, while the Dow Jones industrial average added 0.7%. NYSE indexes were helped by strength in financials, which rebounded after a tough week. Volume on both exchanges was tracking well below Friday’s levels in the stock market today.

Direxion Daily Financial Bull 3X Shares (FAS), a leveraged financial ETF, gapped above the 50-day line after a tough week last week that saw shares drop 7%. Shares were up 4% to 51.79 in afternoon trading. It’s near the top of a 5% buy zone from a 49.60 cup-with-handle buy point.

Inside the Dow, Apple (AAPL) gained 1.6% to 160 after CNBC reported that the company has had talks with Aetna (AET) about bringing Apple Watch to the insurer’s 23 million members.

Nvidia (NVDA) found support at the 50-day moving average, helped by a price target hike from Canaccord Genuity to 190 from 180. After two straight heavy-volume declines, shares of Nvidia were up 6% in afternoon trading.

Also in the chip space, small cap FormFactor (FORM) added nearly 5% to 14.27 as it works on a cup-with-handle base with a 14.80 buy point. It has several analyst presentations coming up, including one tomorrow at the D.A. Davidson 9th Annual Technology Forum in New York.

Meanwhile, earnings headlines were focused in China again. (JD) lost 3% to 44.40. After a breakout in April over a 32.57 flat-base entry, the online retailer has been getting support at the 10-week moving average (see its weekly chart at left).

Bitauto (BITA) surged another 5% ahead of its earnings report Tuesday before the open. The China-based firm is a popular online destination for auto consumers. Bitauto is extended from a 32.43 handle buy point. The gain from the buy point hit 20% in less than three weeks. Normally, that would trigger the eight-week hold rule, but the rule tends to work the best in the early stages of a new bull market.

It’s a busy week of economic data with July retail sales data due Tuesday; housing starts for July and the minutes from the most recent Fed meeting are due Wednesday; and the Philadelphia Fed manufacturing index is due Thursday.


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