Barnes & Noble to the Woodshed, Best Buy Beats Street
Traders and investors all but ignored the Nasdaq trading freeze on Thursday. It appears that the Nasdaq suffered a technical glitch that was called a connectivity issue that lasted for nearly three hours. Thursday's market rebound also ignored the ValuEngine valuation warning with 76.3% of all stocks overvalued 44.2% by 20% or more. The retail-wholesale sector is 24% overvalued and is one of nine sectors overvalued by more than 20%.
Today's closes are likely to keep the weekly chart profiles mixed for the five major equity averages. Dow Industrials and the S&P 500 are below their five-week modified moving averages at 15,306 and 1666.8 respectively. The Nasdaq, Dow transports and Russell 2000 are above their five-week MMAs at 3573, 6426 and 1026.03 respectively.
If we cannot confirm the early-August highs as cycle highs, new highs are likely in September. Here's the upside and downside in today's market pulse.
After Thursday's market strength the Nasdaq is down just 1.5% from its Aug. 5 multi-year high at 3694.18. The upside to my semiannual risky level at 3759 is just 3.3%. The downside to my annual value level at 2806 is 22.9%. This profile continues to justify having 50% of your investment dollars on the sidelines in cash.
Here is today's earnings scorecard with my buy-and-trade parameters: