S&P 500 CROSSES 1,000 BARRIER -- BIOTECHS AND DRUGS MAKE HEALTHCARE TOP SECTOR
HEALTHCARE LEADERSHIP... Heathcare was the top performing group today in a strong market. Applera Corp -- Applied Biosystems Group was the top percentage gainer in a strong biotech group. The weekly chart shows that this is the first move over 20 since last December. It also shows that the next potential upside target is the November high near 24. Most of today's healthcare leadership came from biotechs and drugs. That's reflected in the list of other top performers including Medimmune, Pfizer, Schering Plough, and Chiron. Pfizer was the star of the day in the drugs.
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BANKS AND ALSO HIT 52-WEEK HIGHS... Financials remain in a leadership position, which is good for the rest of the market. The Bank Index was one of the few group indexes to actually hit a new 52-week high today. The weekly chart shows the BKX moving up to challenge the highs hit during the first half of 2002. Brokers were also very strong.
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NEXTEL LEADS TECHNOLOGY HIGHER... The Nasdaq 100 was the strongest of the stock indexes today. Nextel was the strongest stock in the NDX. The daily chart shows the stock breaking out today on rising volume. The weekly chart shows that NXTL has risen to the highest level in two years. Using a log scale, it also reveals that the next test of overhead resistance will take place near 20.
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S&P 500 CLEARS 1,000 HURDLE... The S&P 500 closed above the pschological 1,000 level for the first time since last June. The weekly chart shows that the intermediate advance that started in March is still intact. The weekly RSI is moving close to overbought territory near 70; however, the weekly MACD lines, which are more important in measuring the market's momentum, show no signs of slowing down. Despite our concerns that the market may have reached a "short-term" overbought condition, the uptrend is showing remarkable staying power. That being the case, we're setting our sites on the next major upside target which ranges from 1075 to 1100 -- as shown on the chart. We think one of the reasons that the market is able to shrug off its short-term extremes is due to the fact that-- for the first time in three years -- daily, weekly, and monthly indicators are in sync on the upside.
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MONEY MANAGEMENT UPDATE... Our June 12 MurphyMorris Money Management Model upate can be found on the upper right of the MurphyMorris.com home page. It reviews many of the technical indicators that drive our Decison Model as well as some commentary on the current state of the market. Our relative strength indicator shows that the Nasdaq is still the top performing index,which usually coincides with less volatility and more productive market returns. The Nasdaq AD Summation Index is at the highest level in years. Our New High - New Low indicator, which is our most reliable trend-capturing indicator, also remains positive. Our moving averages show that the intermediate trend is still up. Please see the "Positive to Neutral" paragraph to get an update on our current money management philosophy.
